California is one of the largest marijuana markets in the world. Because of this, it has continually been an example of how large cannabis companies and marijuana stocks can get in a market that supports them. Of course, the cannabis industry has had its troubles including high tax rates and a burgeoning black market. But, it has worked tirelessly to achieve the best marijuana market that it can. Recently, however, California has been hit quite hard by the coronavirus. Although it has not seen as many cases like New York, the state’s sheer size makes it a vulnerable area as a whole.
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Although the state has managed to flatten its coronavirus curve, it has also worked hard to keep businesses flowing. In relation to the cannabis market, the state has chosen to make marijuana dispensaries essential during this time of mass quarantine. This essential business appointment has helped to push the cannabis market demand to high levels than anyone thought. But, despite the states choice to make dispensaries essential, many are still struggling in the current coronavirus afflicted economy.
The Californian Cannabis Market was Struggling Before
Prior to the coronavirus, the Californian cannabis market had a few troubles that it was working to solve. As mentioned before, these primarily were the black market, and high taxation. But, in addition to these troubles, the market has also seen a lot of issues regarding regulation. An article written on the subject states that the market had been “hampered by a morass of regulation, local opposition to stores and a thriving black market, many marijuana businesses have shuttered. The vaping crisis, which was linked to the marijuana business because the pens are a popular method for smoking pot, last fall scared away investors and sent pot stocks plummeting.”
Although it may seem like the industry is in quite a bad place, it is moving toward a much brighter future. Regulation is beginning to shift, and the public backing of the cannabis market is more than ever. The coronavirus pandemic has helped to show that these small businesses and large ones alike, all need help via regulation. The coronavirus has also pointed out an extreme need for change in the industry in order to flourish to its greatest extent. Because of this, hopefully, things will begin to move in a brighter direction as we continue into the future.
How Cannabis Businesses are Working Through the Pandemic
While many cannabis businesses and pot stocks are working hard to stay in business, others are thriving due to the higher demand. This higher demand has been met with a myriad of new changes to individual businesses. This includes the addition of online ordering, delivery and contactless pickups. These methods of doing business have helped the cannabis industry to continue functioning despite troubles that it has run into recently. Many pot stocks have also faced trouble at a higher level. Nicholas Kovacevich, CEO of KushCo Holdings stated that “all of these companies, including us, need to get profitable really quickly or risk running out of money.”
Another executive in the cannabis market stated that recently, “we saw the potential to lose everything and then have the state or federal government not have our backs at all.” Moving forward, we need to begin to see changes that go into place in the cannabis market in order to see success wholly. Until then, the Californian cannabis market may continue to run into trouble.
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