Will Delay of Adult Use Sales Help Level The Playing Field for Small Retailers?

May 1 has come and gone, and adult use cannabis sales have yet to kick off in the Green Mountain State — nor are they likely to for several more months. 

The Cannabis Control Board set the date as the day integrated license holders — medical cannabis dispensaries expanding to serve adult use customers — could launch recreational sales. But an April announcement from one of three medical cannabis providers in the state, CeresMED, made the prospect of a May opening seem improbable.

“While this is permitted by state regulations, CeresMED will not be ready to serve adult-use cannabis consumers on May 1st,” the dispensary, which was acquired by Canadian company SLANG Worldwide Inc. in June, said. “While the official date on which we will begin adult-use sales is still up in the air, we expect it to be near October 1, 2022.”

Grassroots and CeresMED did not respond to multiple inquiries from Heady, while a representative of Vermont Patients Alliance declined to comment, stating that “at this time we are restricted from advertising.”

The state’s other medical dispensaries, Vermont Patients Alliance and Grassroots, have not yet publicly addressed their timeline for launching adult use sales. Grassroots and CeresMED did not respond to multiple inquiries from Heady, while a representative of Vermont Patients Alliance declined to comment, stating that “at this time we are restricted from advertising.”

So why the delay? In its announcement, CeresMED said it was working on its application and awaiting more guidance on adult-use licensing. But the lag may also relate to Burlington’s opt-in language, which explicitly prohibits dispensaries from opening in Vermont’s largest city until October, when the state will start issuing licenses for all cannabis retailers. 

CeresMED has locations in Burlington and Brattleboro, while Vermont Patients Alliance is in Montpelier and Grassroots operates out of Brandon.

The opt-in measure approved in 2021 was championed by organizations such as the Vermont Racial Justice Alliance and the Vermont Growers Association. These groups initially pushed for a 36-month delay for integrated dispensaries, according to VGA Executive Director Geoffrey Pizzutillo, but the window was reduced to five months during City Council deliberations. 

“And so this was our motivation for our language, which is what we call equitable retail opt-in, which is basically attempting to level the playing field.” — Executive Director Geoffrey Pizzutillo, Vermont Growers Alliance

Pizzutillo said the goal was to prevent corporate dispensaries from getting a head start on the market over independent retailers, especially considering challenges cannabis businesses face in terms of banking, financial capital and stigma. He noted that social equity applicants face even more barriers.

“We know, on average, it takes at least a year or two for one of these small businesses to really get going,” Pizzutillo said. “And so this was our motivation for our language, which is what we call equitable retail opt-in, which is basically attempting to level the playing field.”

That’s why Damien and Bailey Evans of Higher Elevation in Morrisville see the delay as a good thing for small start-ups.

“To me, it seems unfair that these medical dispensaries that have been here for a while get to have first dibs on everything,” Damien Evans said. “It should just be everyone.”

Tito Bern of Bern Gallery in Burlington is glad local organizations fought to get rid of the head start for integrated dispensaries. But as he sees it, these companies still have a leg up because they’re already poised for cultivation.

To have products ready to sell in October, cannabis growers would need to start taking clones in early June, Bern explained. But the CCB only recently issued its first license for a tier one indoor cultivator.

They have a huge advantage still because if October 1 the retail market opens, the majority of small Vermont businesses will not have any cannabis ready at that time.” — Tito Bern, Bern Gallery

“Their ability to grow — they’re way ahead of all of us in that respect,” Bern said. ” … They have a huge advantage still because if October 1 the retail market opens, the majority of small Vermont businesses will not have any cannabis ready at that time.”

For Meredith Mann of Magic Mann in Essex, it’s not surprising to see integrated dispensaries put off opening dates. Mann would have preferred for the state to prioritize small, local businesses from the start rather than giving advantages to larger corporations. She does have concerns, however, that continued delays will just push consumers further into the gray market. 

“People come in every day asking, ‘But I thought it was legal May 1?’ Nobody knows truly what’s happening and that hurts business as a whole.” — Meredith Mann, Magic Mann

“It’s really confusing for the average person who isn’t involved in cannabis business or politics to even know what the heck is going on,” Mann said. “People come in every day asking, ‘But I thought it was legal May 1?’ Nobody knows truly what’s happening and that hurts business as a whole.”

In the meantime, the Evanses said the best thing the state can do is speed up the licensing process so retailers can make it to the starting line by October.

“I think just getting all the licenses approved and out quicker than currently the licenses for just growers are being approved would be nice,” Bailey Evans said, noting delays for cultivators will cause more delays for retailers down the road. 

“It’s a domino effect,” she added.