3 min read

Delivering Weed

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One business idea I have gotten pitched a lot in the last 3 months is weed delivery; this has increased dramatically as marijuana is now legal in New York, and a few people have asked me how they can go about starting a dispensary.

Delivering something that's still illegal at the federal level is really, really hard, because you don't have access to a whole variety of things, like bank accounts, that make it easy to collect money and provide services. On top of that, while it's true that you can make a lot of money when laws are in flux (definitely true today), it's also true that you can go to jail as those laws change and destroy your business.

In New York, for example, there's no good way for a police officer to tell if you're high – only five states have laws that are similar to the blood-alcohol content laws most of us are familiar with for driving. This is one of those things that's going to be a problem, because people will get high and drive, and it means that the laws surrounding legal marijuana will have to change to accommodate this.

When a law changes, politicians tend to change a lot of it. Sometimes for good, and sometimes for bad.

If you're running a business that relies on a single law, then when that law changes, your business could be totally screwed.

We do have an example of what happens when there's a patchwork of state laws to regulate something that used to be illegal, because that's what happens with alcohol distribution. I still remember the first time I went into a supermarket in Idaho and there was wine, beer and liquor there – in New York, supermarkets are restricted to beer.

If you wanted to start a direct-to-consumer alcohol brand, you can't ship any of your booze using the post office. Four states won't let you ship alcohol, period. And if you want to ship across state lines, you're subject to a patchwork of middlepeople who take a cut every step of the process. In short, shipping alcohol is incredibly expensive, and not just because it's heavy.

I expect marijuana delivery, whether it's hand-delivered like food or shipped like everything else, to have a similar patchwork of laws that will make it almost impossible to scale beyond a couple of states for at least the next decade. This doesn't mean you can't have a super-profitable business in cities like Los Angeles or New York, but it does mean than an Uber for weed delivery is unlikely.

In addition, I'm pretty sure that the economics of a dispensary will end up being pretty similar to the economics of a liquor store as more and more are allowed: 10% or so, which isn't bad at all for retail, but if you're starting a business, there are plenty that have profit margins in the 20%+ range and aren't highly regulated.

One idea I did have was to start a drive-thru taqueria and dispensary. Let's face it: few things are better when you're high than tacos. Heck, few things are better than good tacos, period. So if you want to take that idea and run with it, have fun. I'm pretty sure it's still illegal in all 50 states, though, which makes me a sad taco.

sad taco plus legal weed equals crumbs copyright jon brodsky hopara.com
Starting a legal weed business is hard.