Michigan’s adult cannabis market is now more competitive
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When Michigan’s Marijuana Regulation and Taxation Act went into effect in 2018, it contained a clause that gave existing medical cannabis license holders a huge two-year competitive advantage that many had expected by November 2021.
However, a clause in the ordinance gave the Michigan regulator the option to postpone that date to November 2020. This month the agency did just that, and as a result, Michigan’s adult cannabis market is becoming significantly more competitive.
How the change will affect Michigan cannabis licensing
According to the Cannabiz Media License Database, Michigan currently has 1,216 active cannabis licenses across the supply chain, with the majority for cultivation (379), medical pharmacy (275), adult retailer (148), and delivery (261 ) was issued.
Given that Michigan has no state cap on cannabis licenses, it can be assumed that after the market opens in November 2020, there will be an influx of new applications and more competition with more licensees.
One of the main reasons the state marijuana regulator overturned the regulation requiring companies to be licensed for medicinal cannabis in order to obtain a recreational license is to address social justice issues.
Regulators told Crain’s Detroit that lowering the barriers to entry into the adult cannabis market would allow them to develop programs that benefit people wrongly affected by the war on drugs, particularly through law enforcement related to cannabis.
The bottom line is that entrepreneurs looking to get into the Michigan cannabis industry will soon have a better chance of doing so when the doors to adult license applications open later this year. It’s a win for them, but not so much for current adult licensees who thought they had another year with little competition to work with. Today’s active retailers may soon have to invest more time and money to differentiate their brands from new competitors, retain existing customers, and attract new customers.
What does the change mean for consumers?
For consumers, more licensees mean better access to the cannabis products they want and need. While it is very unlikely that markets will be saturated with new adult retail locations in the near future (municipalities can limit the number of retailers operating in their communities), the addition of a new competition usually helps consumers.
Open markets are usually fairer markets for consumers with more competitive prices, improved customer service, and much more. License holders will have to work harder to earn consumers’ business, but consumers will have more power in demanding competitive pricing, product choices, and so on. For Michigan’s consumers, additional adult licenses are a very good thing.
Key Insights into Michigan’s Open Licensing Adult Cannabis Market
While existing Michigan adult cannabis license holders would have preferred to prevent new businesses from entering the market until November 2021, opening the market to new license applicants early will bring far-reaching benefits to entrepreneurs, consumers and the state cannabis industry.
For companies looking to connect with new cannabis companies to sell their products and services, the further opening of the Michigan market coupled with the lack of a state license cap means significant opportunities! Of course, the Cannabiz Media team tracks all changes every day and adds new information to the license database.
By subscribing to the Cannabiz Media License Database, you can introduce your brand, business, products, and services early on to license applicants and new licensees in Michigan! Schedule a free demo and see how you can use it to do more and sell more.