Online Marijuana Sales a Burgeoning Market in North America

The North American ecommerce market for marijuana products is gaining momentum as Canada legalized the sale of recreational marijuana throughout the nation in October 2018 and more nations in the U.S. legalize the sale of both recreational and medical marijuana. However, numerous barriers will impede online sales of cannabis products at least for the next few decades.

Impediments to Online Revenue

Sending marijuana through the mail is prohibited in america, even for medical purposes. The prohibition applies to the United States Postal Service along with FedEx and UPS.

By comparison, medical marijuana was sold online in Canada and delivered by Canada Post since 2013. Late last year the Canadian government resisted the purchase of up to 30 g of recreational marijuana. The majority of these sales are happening online, as retail shops have been slow to start. The states must enact their own rules so there might be differences in regulations .

Along with the flower that’s typically smoked, recreational marijuana includes edibles and CBD, or cannabidiol, a non-psychoactive compound found in the hemp plant. CBD cream and oil are used as a remedy for many health conditions, and CBD earnings are widespread in america.

CBD is currently being added to beauty products and THC, the psychoactive ingredient in marijuana that causes the sensation of being high, has been added to drinks. CBD beer is also available on the market.

While the selling of CBD and edibles hasn’t been legalized in Canada, about a dozen Canadian sites are selling these goods. The Canadian government is supposed to think about legalization after this year.

Shipping marijuana from Canada into the United States is prohibited, no matter whether a state has legalized recreational or medical marijuana purchases. Some Canadian websites have opened American subsidiaries that operate in countries that have legalized marijuana sales. It’s very likely that they need to get in on the CBD and edibles marketplace.

Global Market

Based on Arcview Market Research and its partner BDS Analytics, total global spending on legal bud will reach $57 billion by 2027. The greatest market will be North America, growing from $9.2 billion in 2017 to $47.3 billion in 2027. The recreational market is going to be the biggest segment in North America, contributing 67 percent of the sum, with medical cannabis making up the rest.

By comparison, in Europe medical cannabis will dominate and it’ll become the biggest medical marijuana market in the world.

U.S. Market

The District of Columbia and 10 states — Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and Washington — have adopted laws legalizing marijuana for recreational and medical use. Twenty-one countries have legalized medical marijuana only.

Nevertheless, at the national level it’s still a crime to possess, buy, or sell marijuana. Marijuana can’t be transported across state lines, even if the states in question have recreational or medical marijuana programs. However, states that have programs provide vendors certain legal protections.

Federal law prohibits FDIC-insured institutions from making loans to or accepting deposits from a bud company. Marijuana businesses typically need to work with personal, state-chartered banks. 1 such bank — GRN Funds, located in Bellevue Washington — manages over $500 million in deposits from CBD businesses on the West Coast. Canadian marijuana companies enjoy a competitive advantage because they have access to the international banking system and may legally transfer funds to banks in america in states where marijuana applications exist.

Ecommerce Sites

Since the marijuana flower can’t be sent through the mail from the U.S., online sales consist largely of CBD solutions. Several American sites don’t sell online but rather either connect to medical marijuana or advertising and promotion opportunities for dispensaries.

Following are a couple of American and Canadian websites which provide services and products.

  • Green Growth Brands in Columbus, Ohio, is a publicly traded firm. It hosts an assortment of brands on its website, and the CBD products can be purchased online and sent to 35 states.
  • Leafly provides links to dispensaries across the nation and acts as a marketing and advertising resource for brands that wish to present their products to clients.
  • CBD for Life is an American company that sells online various CBD products such as creams, bath products, tinctures, and shampoos.
  • The Mega Marijuana Store appears to flout U.S. law. With a shop in Vermont, it ships and sells marijuana flower and seeds in addition to edibles and CBD solutions. Its website boasts that it provides,”…guaranteed stealth delivery to anywhere in the world at no additional cost.”
  • Quick Greens is a Canadian company that sells both edibles and bud flowers online.

Software Platforms

Several applications platforms have sprung up to serve dispensaries and their clients. Among them are:

  • Pot Hero is an Oregon-based firm that provides both free software which enables customers to place orders directly from a dispensary site. Some dispensaries provide delivery while others demand customer pickup.
  • Green Marimba is a Boulder, Colorado-based firm that hosts dispensary sites which include automated compliance reporting and resources for managing vendors, inventory, and customer relationships.
  • Shopify entered the marijuana market when recreational marijuana became legal in Canada. Some Canadian provinces have selected Shopify to conduct their ecommerce sites. Shopify has also signed up bud businesses.

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