Why it matters: Santa Monica, California has issued its first-ever permit for a cannabis dispensary, although it faces strong competition from nearby delivery services and dispensaries.
What they are saying: Local Cannabis Company, owned by Massachusetts-based Calyx Peak, will become the city’s first permitted dispensary. “Most stores should be doing five to nine million a year, that’s normal. This area should easily make 10 million, especially given how many visitors come to Santa Monica,” said Calyx Peak CEO Erin Carachilo. Her colleague, Howard Keum, reportedly called on Californian cannabis regulation to “graduate to adult-use cannabis possibilities”.
The big picture: Santa Monica’s medical dispensaries currently offer limited on-site cultivation, light manufacturing operations, and no commercial cultivation, testing or distribution. Last year the city voted to implement taxes for non-medical cannabis operations, but growth in the market could be inhibited by the number of Californian medical cannabis users who stopped seeking medical recommendations for legal cannabis products for over 21s.
What to watch: Harvest of Santa Monica, a second dispensary, was also approved this year, but neither it nor Local Cannabis Company will be able to serve anyone without a license or ID proving Californian residence.
My take: Santa Monica may be late to the game, but business for both dispensaries expected to earn $10m on an annual basis is likely to boom. The next frontier is adult-use cannabis, as Californian regulation lags behind the other states that have already regulated the industry, though this may present an opportunity for lawmakers to learn from how they’ve done it.
