The 2022 NECANN NJ convention held in Atlantic City this past weekend at the Convention Center featured many interested in New Jersey’s cannabis market.
It was the third NECANN cannabis convention held in Atlantic City, NJ. Like many cannabis conventions, it was a largely Businesses 2 Business (B2B) affair. Most exhibitors were ancillary companies looking for license winners who wanted to make a deal. They ranged from accountants to machine makers and package specialists. The licensed dispensaries the Botanist, Curaleaf, and Ayr, which owns Garden State Dispensary, were also there promoting their brands.
Much of the value derived by attendees was through networking through largely impromptu meetings on the cannabis convention floor, and after-parties held nearby.
At least three attendees learned they had won a license from the New Jersey Cannabis Regulatory Commission (NJCRC) during Friday’s meeting while attending the NECANN cannabis convention. The NJCRC themselves had no presence at the cannabis convention.
Given that they still need to finish processing about 800 applications, one can understand if they felt too preoccupied.
Atlantic City is arguably the most pro-cannabis town in New Jersey since they are eager to see cannabis drive desperately-needed economic progress. Moreover, hospitality and tourism is their prime industry. So being hospitable to cannabis companies and aficionados poorly viewed by most towns is a great opportunity for them.
While casinos might be too regulated to entertain cannabis companies, hotels and bars have no such issues.
NECANN Cannabis Convention Seminars
A range of noted speakers gave talks and served on panels at the convention.
Attorney Chirali Patel gave an interesting talk to a packed room during NECANN’s cannabis convention. She said many of the large cannabis corporations want to be bought by alcohol or pharmaceutical corporations.
“All the big players will come in at some point. It’s just a question of when,” Patel said.
Many cannabis policy experts agree with her.
“How do you compete? It’s customer service, branding,” she said.
“You have to think five years down the line,” Patel advised the audience.
She noted that not all the new, large companies will survive. CP noted many of the Internet boom companies like Ask Jeeves ultimately died.
“There still is opportunity,” Patel said.
However, “this is one of the most difficult industries to get into,” she cautioned.
Patel said New Jersey has limited vacant commercial and industrial property in general, which makes it even harder for cannabis companies to find a location.
“It’s a limited inventory market,” she said about real estate. “If you’re calling these places, don’t tell them you’re a cannabis business.”
“Those landlords and property owners talk,” Patel said.
She said they charge ten times charge more than their usual rate to cannabis companies, taking what some call the “Green Tax.”
Towns and the Cannabis Market
Patel noted New Jersey municipal cannabis policy varies widely and creates the de facto on the number of cannabis companies that will be able to open.
“I would start with reading the ordinances,” she said.
Patel noted that without guidance from the NJCRC, many towns created high barriers to entry for cannabis companies by allowing them to only operate in certain places and high fees.
“I would go to towns that haven’t opted in,” she said.
Patel encouraged people to educate local officials.
“They just don’t get it. It’s the stigma,” she said.
Patel noted some of the loopholes in cannabis legalization could help large Multi-State Operators (MSOs) secure more than one license.
“Once again, our state is promoting big biz over the little guy. Over-regulation is what’s killing the market… and creating predatory practices,” she said.
Patel noted that if the state agency changes regulations, companies must pay to comply. Smaller companies will have more difficulty doing so.
She noted that “the legacy market in the United States is bigger than the legal market. Most people are more comfortable going to their local connect.”
“It’s not great quality,” Patel said about dispensary cannabis.
Access to Capital remains difficult for many small cannabis companies.
“Money is going to be available at some point. I don’t know how much or what the criteria will be,” Patel said.
She said some large cannabis companies have secured loans from banks, telling them it’s for construction.
“They don’t even tell the banks they’re cannabis,” Patel said.