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Florida is a completely vertically integrated state. This is good for regulators and tax dollars but absolutely horrible for people that consume marijuana recreationally/ for medical purposes or are trying to startup a dispensary.
For those who may not know what vertical integration is it is the combination in one company of two stages of production, two stages that are normally ran by two separate companies.
Vertical integration has had a tremendous impact on the legal marijuana market in Florida especially because Florida is not a state where recreational marijuana is legal.
The way vertical integration works for Florida cannabis is that cannabis companies are their own growers, processors and distributors. This eliminates all possibilities of any outside cooperation or subcontracting. Vertical Integration is great for big companies with deep pockets. It is not meant to help the little guy.
The "Father of the Legal Cannabis Industry" explains Florida Cannabis Vertical Integration:
The major effects vertical integration has had on the cannabis market are especially noticeable in the way of licensing/ the lack of licenses the state allows. In the beginning of the vertical integration regulation Florida only allowed 8 licenses. As time went on they approved a few more which totals out to be a whopping 22.
Only 22 companies are able to legally run a vertically integrated cannabis company in Florida. Only 22? Florida is a very large state with a very high population; a high populated state where I might add, 73.1% voted to legalize medical marijuana. The worst part is that out of those 22 companies only 13 of them are actually producing products.
As a consumer you are not left with many options. As a aspiring dispensary owner you are left with a slim chance of actually making it in Florida. All because Florida, an area that is 65,755 square miles will only give out 22 licenses!
This really gives rich, big named companies a shoe in and other smaller start-ups the lower hand. In turn the law limits diversity in the industry and once again becomes another industry that is run by corporate greed.
Well it is already pretty hard to get a license to sell and produce marijuana in Florida and applying to get a license costs money, and it is not cheap. So obviously the price on the marijuana is going to be higher than the average in order for these companies to make money. So the consumer is also taking a big hit not just the aspiring dispensary owners.
Most likely as a consumer you are going to be paying more than you would be paying for medical marijuana in a non vertically integrated state. So think twice as a medical marijuana user where you want to put your money and what businesses to support and maybe steer clear of purchasing your medical marijuana in Florida.
If you are in Florida and you are interested in establishing your marijuana farm, then hear this out. The growing, harvesting, distribution and selling of weed are now the total responsibility of weed investors in Florida. What this means is that the government can no longer give you any assistance.
The truth is that it is either you are financially buoyant enough to handle everything on your own or you are out. It is unfortunately extremely hard to compete with the big cooperate companies, I would even go as far as saying it is pretty much impossible.
Some high school guys may be nursing the ambition of setting up a dispensary at Florida. They may be aiming at making huge financial success. This isn’t a bad aspiration if you lived in a state like Michigan where recreational weed is legal.
As for making money from cannabis in Florida, there are a lot of laws and regulations and the only companies that have license to sell are big cooperate companies. Several of these companies are listed in the stock market of York Stock exchange.
The vertically integrated weed businesses have created a monopoly which allows the big corporate companies to control over 65% of the marijuana business.
Product availability is another huge concern with the vertical integration in Florida. There is a lack of product availability, which is due to the small amount of licensed cannabis businesses operating. For awhile Florida would not allow whole flower cannabis to be sold, instead only concentrates and tinctures. There has also been talk of a cap on THC in marijuana of only 10%. Only 10% THC? That is nothing and it is already extremely difficult to purchase marijuana in Florida.
How can this be good for the market in Florida? It definitely is not going to be moving forward that is for sure.
Details of the dominance of Trulieve from chasingmarkets.com
Trulieve Cannabis was one of the first companies to be rewarded cultivation and retail licenses in the state of Florida and they wasted no time ramping up production.
The company currently has 500,000 square feet of cultivation space, 26 high-end retail dispensaries and employs 1,300 workers in Florida.
In an interview with Trulieve CEO, Kim Rivers, and Newcannabisventures.com, Kim stated that the company manufactures more than 55,000 products each week and has brought on between 3,000 – 4,000 medical patients each week.
Cannabis stocks are growing bigger by the day. You have to capitalize on it to grow your own business. Opportunities are waiting to be tapped in Florida's marijuana industry. However, there are limitations posed by the vertical integration of medical cannabis in Florida.
Florida is a state that seems to be a bit behind other states as far as recreational and medical marijuana goes. While many places nationally and internationally are moving away from big corporations and vertically integrated ways, Floridians are stuck with limited options and in my opinion an outdated system.
In my opinion the vertical integration of the cannabis industry in Florida lacks small businesses, competition and any type of innovation. If a change in the market does not come soon enough I fear that the cannabis industry in Florida will amount to nothing. This is a sad prediction especially because the cannabis industry creates plenty of job opportunities for many people.
Even though recreational marijuana is not legal in Florida, the medical marijuana industry is huge and a better, more profitable system could be put in place instead of vertical integration. Especially because vertical integration has proven to be a problem to more than just the providers. Vertical integration is damaging to the consumers as well.
Here is a video outlining most of the Florida's Medical Marijuana legal process and regulations:
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