Why There Are Little Dispensaries in Florida

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"Cities and municipalities in Florida can be stingy with how many dispensary licenses are granted in their respective jurisdictions and to whom these licenses go."
Florida-could-provide-signal-on-future-of-recreational-marijuana

Blame the state, blame local municipalities, and blame the dispensary companies themselves. All three have created this situation.

Cities and municipalities in Florida can be stingy with how many dispensary licenses are granted in their respective jurisdictions and to whom these licenses go. Local startup companies are often passed over in favor of bigger, established companies with deep pockets. Many of those bigger companies aren’t interested in serving small communities. It doesn’t make economic sense. So they cluster in the most population-rich regions.

That wouldn’t be a problem in a wide-open industry. If a town or county is underserved, usually a local entrepreneur will start a small boutique and fill the niche.

But Florida’s medical marijuana industry isn’t wide open. It’s tightly regulated and vertically integrated. That means there are only 22 companies with medical marijuana licenses in a state with more than 20 million people. Of those 22 companies, only 14 have actually opened dispensaries.

And those 22 companies are required by law to be fully integrated, which means they have to grow the plants, manufacture the products, and sell them in retail dispensaries. There’s no specialization—and that means it costs a lot of money to even get into the business.

In Florida, a small handful of companies own licenses that allow them to open up to 30 or more dispensaries. Those companies may not open all 30 stores, though, and they don’t spread them evenly around the state. That wouldn’t make economic sense for them. They open dispensaries where the surrounding population is dense, and patient foot traffic is strong and steady.

That’s made for a top-heavy market. There are 22 licensees, but the top five companies operate two-thirds of all dispensaries.

Why don’t local entrepreneurs just apply for a license? They can’t. The state isn’t issuing any new ones. Existing licenses cost millions of dollars, if they’re available. Last year the owner of two separate Florida medical cannabis licenses put one on the market for $40 million (with an option to open up to 30 dispensaries) and the other for $55 million (with an option to open up to 35 dispensaries).  

Situation may be changed

At the state level, the Florida Supreme Court is going to be looking at arguments in the near future to pave the way for non-vertically granted licenses for dispensaries in the state.

That could greatly expand opportunities for small and local businesses to open locations in these underserved communities. You can read more about the legalities involving this case at South Florida Hospital News.

Medical marijuana has been legal in Florida since 2016, and efforts for full marijuana legalization are moving full steam ahead for a potential vote in 2022. While a lot of progress has been made thus far, the need for advocacy never ends, especially as accessibility of safe and legal medical marijuana products remains an issue in several large portions of Florida.

Floridians looking for resources and ways to help can check out both Florida for Care and Make it Legal Florida for more on this issue.

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