The new rulebook for California’s aspiring, and already up-and-running, cannabis dispensaries, has plenty of regulations — 276 pages worth, to be exact, courtesy of the California Department of Public Health (CDPH).
Restrictions and Guidelines: An Overview
For starters, here’s a scaled-down primer of restrictions and guidelines on recreational cannabis sales for dispensaries in California:
- Your business can’t be within 600 feet of schools
- Your business must close by 10 pm
- Your business must have 24-hour video surveillance
- You may not sell edible products in serving sizes of more than 10 milligrams of THC, and more than 100 milligrams of THC for the total package
- Cannabis delivery services may only be provided by employees of licensed retailers, and can only be made in enclosed automobiles for now — no drones or bicycles
- If you want to host a cannabis event, you must apply for a special state license
- You may only give out free cannabis samples to adult medical patients or their caregivers
- Your annual recreational cannabis license will range from $800 — for businesses transporting cannabis — to up to $120,000 for a business that generates more than $4.5 million a year
- Your advertising may only be placed in media outlets where at least 71.6 percent of the audience “is reasonably expected to be 21 years of age or older”
- And of course, no cannabis sales are permitted to those under 21 years old, with an ID required
- Adult use customers can buy up to one ounce (28.5g) of non-concentrated cannabis, eight grams of concentrate, and six immature plants. (Medical patients can purchase up to eight ounces of cannabis)
Edible Cannabis-Infused Products: What and How Much Can you Sell?
One of the most notable sets of regulations applies to the sale of edible marijuana-infused products — such as cookies, gummies, and candies.
When the state’s adult-use market starts Jan. 1, such edibles must contain no more than 100 milligrams of THC. Plus, edibles must be clearly divided into separate servings of no more than 10 milligrams each.
In addition, products will be limited by shape — which means no human-like shapes, animals, insects or fruit — an effort to prevent the edibles from appealing to children and teens.
Packaging Restrictions: No Cartoons, Images or Other Messaging that Appeals to Children
What’s more, products must not resemble or be referred to as “candy” or contain cartoons, images, or other messaging that could appeal to children.
Finally, no packaging may include any health promises or “guarantees” that have not been scientifically proven. CDPH also reserves the right to ban any future products that it deems appeal to children.
The new regulations also will prohibit dispensaries from mixing cannabis products with alcohol, nicotine, caffeine or seafood in any forms.
Limits on THC: The Biggest Change to the Cannabis Marketplace
The limit on THC content is thought to be the biggest change to the legal cannabis dispensary marketplace. The restrictions mean that some popular but extremely potent items, like the Black Bar brownie by Korova Edibles — with up to 1,000 milligrams of THC — will be illegal to sell at dispensaries.
“The most popular edibles were the higher-potency edibles,” said Dennis Hunter, founder of Santa Rosa-based Cannacraft, which produces a host of cannabis brands, including artisan chocolates. “The regulated market is banning something people want.”
California’s limit on recreational cannabis edibles does put the Golden State in alignment with other states with recreational cannabis such as Washington, Colorado, and Nevada, which cap edibles to recreational consumers at 100 milligrams of THC.
Cannabis Dispensaries: A Few Details About Licenses
To be successful in the long run, cannabis dispensaries should be extra clear on how the cannabis license types apply to their businesses.
There will be two cannabis dispensary license designations: A licenses (for adult-use commercial cannabis activity); and M licenses (for medical cannabis activity).
At the moment it is unclear whether an existing medical cannabis dispensary in California will be required to obtain separate A and M licenses (probably with license fees associated with both), or whether they will be allowed to obtain a combined A and M license.
There will be a six-month interim transition period, lasting from January 1 to July 2018, to allow cannabis dispensaries the chance to make the transition into recreational cannabis.
Cannabis dispensaries should make a clear decision as to how they wish to categorize, license, promote, and market their cannabis business. A dispensary with an A license will have distinctly different marketing needs than a dispensary with an M license.
License Approval: Eagerly Awaiting the Authorization Email
Through it all, come New Year’s Day, cannabis shop owners will be eagerly awaiting receipt of an authorized email from the state, giving them the word that their temporary license has been approved. With the OK, they’ll be able to immediately start selling cannabis to any adult, 21 and over, with a legal ID.
If you have any questions about the new adult-use recreational cannabis regulations, we would love to discuss them with you – as well as your business and marketing strategy. Contact us today if you have questions about cannabis marketing and recent industry developments. Like us on Facebook, follow us on Twitter, and check out our Instagram for company news and updates.