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2021 Cannabis Business Opportunities in Emerging Markets

Date of Last Update: March 12, 2021

This past election gave new momentum to the Cannabis Industry, propelling it toward the future of broader legalization that continues to unfold. In November, voters approved legalization ballot measures in Arizona, Mississippi, Montana, New Jersey, and South Dakota. Since then, lawmakers across the country are developing and passing legislation to expand existing programs and create new ones. Below is an overview of the opportunities on the horizon in these freshly legal markets as well as existing markets. Included is a summary of each market's licensing structure and potential growth to provide context on the scope of each opportunity.

United States

Arizona

  • Estimated Adult-Use Sales 2021: $375-400 million (MJBizDaily)
  • Estimated Adult-Use Sales 2024: $700-760 million (MJBizDaily)
  • Population: 7.3 million
  • Number of Licensed Cannabis Businesses: 130
  • Licensing Structure: Limited 
  • Program Type: Adult-Use and Medical
  • Opportunities:
  • Before the March 9, 2021 deadline, 377 applicants each paid a $25,000 non-refundable application fee to the state for a chance at 13 new Marijuana Establishment licenses. These licenses are for sparsely populated counties with fewer than two licensed Marijuana Establishments. 
  • The Arizona Department of Health Services is currently developing the rules for 26 social equity Marijuana Establishment licenses. Municipalities are tasked with setting local regulations prior to April 5, 2021, and draft social equity rules will most likely be released in April. 
  • Considering there are only 130 licensed Marijuana Establishments to date and there were nearly 400 applicants for 13 licenses in rural counties the social equity licenses will be extremely valuable. The upcoming social equity licensing round will be the last chance to get into Arizona’s cannabis market for quite some time. Check out our blog to learn more.


California

  • Adult-Use Sales 2020: $4.4 billion (MJBizDaily)
  • Estimated Adult-Use Sales 2024: $7.2 billion (Statista)
  • Population: 39.5 million
  • Number of Licensed Cannabis Retailers (Storefront and Non-Storefront): 1,057 (BCC
  • Licensing Structure: Open licensing based on municipal regulations
  • Program Type: Adult-Use and Medical
  • Opportunities:
  • Nearly 50 municipalities are in the process of developing and implementing commercial cannabis ordinances, including Costa Mesa, Encinitas, and Monterey. Check out our up-to-date blog for the latest municipal opportunities.


New Jersey

  • Estimated Adult-Use Sales Year 1: $773 million 
  • Estimated Adult-Use Sales Year 4: $1.8 billion 
  • Population: 8.9 million
  • Number of Licensed Cannabis Businesses: 12 (With up to 24 licenses pending)
  • Licensing Structure: Limited 
  • Program Type: Adult-Use and Medical
  • Updates:
  • On February 22, 2021, Governor Phil Murphy signed the implementation bill officially launching the state’s adult-use program.
  • During the 18 months, restrictions against vertical integration will be in place to prevent the formation of premature monopolies.
  • 30% of licenses must be allocated to businesses owned by women, minorities, or disabled veterans. 
  • Opportunities:
  • Grower, Processor, Wholesaler, Distributor, Retailer, and Delivery licenses will be made available once rules are adopted.
  • Check out our New Jersey blog for more details.


Massachusetts

  • Adult-Use Sales 2020: $681 million (CCC) despite two months of forced closure
  • Estimated Adult-Use Sales 2024: $1 billion (Statista)
  • Population: 6.9 million
  • Number of Licensed Cannabis Retailers: 313 (CCC)
  • Licensing Structure: Open licensing based on municipal regulations
  • Program Type: Adult-Use and Medical
  • Opportunities:
  • New business opportunities in municipalities across the state for all license types.
  • Marijuana Courier (delivery-only) licenses are currently available for social equity applicants. 
  • Marijuana Delivery Operator licenses (wholesale purchaser and delivery business) are in the works and will soon be available to social equity applicants. 


Michigan 

  • Cannabis Sales 2020: $985 million (MRA)
  • Estimated Adult-Use Sales 2024: $3 billion (MRA)
  • Population: 9.9 million
  • Licensing Structure: Open licensing based on municipal regulations
  • Program Type: Adult-Use and Medical
  • Opportunities:
  • As of March 1, 2021, applicants no longer need an active medical marijuana permit to be eligible for the following adult-use license types: 
  • Marijuana Retailer
  • Marijuana Processor
  • Class B Marijuana Grower
  • Class C Marijuana Grower
  • Marijuana Secure Transporter
  • Opportunities are opening across the state based on municipal and county regulations, including Detroit which will begin accepting applications on April 1, 2021. 


Mississippi

  • Estimated Adult-Use Sales Year 1: $6 million (MGO)
  • Estimated Adult-Use Sales Year 4: $66 million (MGO)
  • Population: 2.9 million
  • Licensing Structure: Open licensing, limited municipal oversight
  • Program Type: Medical
  • Opportunities:
  • The Mississippi State Department of Health (MSDH) is currently working to establish the rules for medical cannabis businesses and the license application process for the July 1, 2021 deadline. 
  • Check out our Mississippi blog for more details.


Montana

  • Estimated Adult-Use Sales Year 1: $57.9 million (MGO)
  • Estimated Adult-Use Sales Year 4: $175.2 million (MGO)
  • Population: 1.1 million
  • Number of Licensed Cannabis Retailers: 368
  • Licensing Structure: Open licensing based on municipal regulations, voter approval required to ban businesses
  • Program Type: Adult-Use and Medical
  • Opportunities:
  • Vertically integrated business licenses will be made available. These licenses allow you to sell up to 50% of the products that you produce or manufacture on a wholesale basis.
  • Licenses limited to state residents and current medical operators will have exclusive access to the adult-use licenses for the first year.
  • Check out our Montana blog for more details.


Illinois

  • Cannabis Sales 2021: $669 million (IDFPR)
  • Estimated Cannabis Sales 2024: $2 billion
  • Population: 12.7 million
  • Licensing Structure: Limited
  • Number of Licensed Cannabis Retailers: 81
  • Program Type: Adult-Use and Medical
  • Opportunities:
  • Lawmakers are pushing for up to 110 additional dispensary licenses. Of which, 75 licenses would go to non-perfect scoring applicants from 2019 and 35 licenses could be made available later this year based on demand. 


Maine

  • Estimated Adult-Use Sales Year 1: $20 million
  • Estimated Cannabis Sales 2025: $300 million (Nucleus One)
  • Population: 1.3 million
  • Licensing Structure: Open licensing based on municipal regulations
  • Number of Licensed Cannabis Retailers: 16
  • Program Type: Adult-Use and Medical
  • Opportunities:
  • This market is in its infancy and there are plenty of municipal opportunities available to start a cannabis venture in the state. 


Virginia

  • Estimated Adult-Use Sales Year 1: $400-500 million (MJBizDaily)
  • Estimated Adult-Use Sales Year 5: $1.4 billion
  • Population: 1.3 million
  • Licensing Structure: Limited to 400 retail stores, 25 wholesalers, 60 manufacturers, and 450 cultivators
  • Program Type: Adult-Use and Medical
  • On February 27, 2021, Lawmakers approved legislation for a commercial recreational marijuana program. The scheduled start date is Jan. 1, 2024, and within five years sales are projected to reach $1.5 billion annually. 


Additional States

  • Further legalization is likely on the horizon for Connecticut, Florida, Minnesota, New Mexico, New York, Pennsylvania, Rhode Island, and Texas.
  • Kansas, Kentucky, South Carolina, and Alabama could legalize medical marijuana in 2021. New Paragraph

Mexico

  • Estimated Medical Cannabis Sales 2025: $249 million (Grand View Research)
  • Population: 127.6 million
  • Licensing Structure: Federal Licensure
  • Program Type: Medical
  • Opportunities:
  • On January 12, 2021, the regulations for Mexico’s medical cannabis program were officially published in the country’s Official Gazette.
  • Opportunities are now available to secure medical marijuana production, manufacturing, quality control laboratory, and import/export licenses. For more details, check out our Mexico blog.


As you can see, there are abundant opportunities on the horizon, and if you're interested in entering any of these emerging markets, it's now time to get started! The best advice we can give you as a cannabis entrepreneur is to start early and do extensive research. It can take anywhere from four to eight months to develop a robust license application. Start by reviewing all laws, regulations, and proposed rules for the market you are interested in because this will determine what types of businesses are possible and what requirements you have to meet to successfully secure, license, and operate. Additionally, you can start to identify compliant real estate to meet the needs of your operation. Real estate can often be the bottleneck that limits the number of licenses available. By identifying potential properties and contacting property owners while draft rules are being finalized, you can give your business a massive advantage over other competitors. If you would like to establish a business in any of these markets, we're here to help. Schedule an exploratory call today.

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