At a panel discussion in Vancouver, BC, last week, I listened to two New York Times reporters talk about all the ways cannabis legalization is supposedly failing.


No, legalization isn’t already failing in Canada. This is how it works in new markets, every time.

It is failing in California, said San Francisco bureau chief Thomas Fuller, because the state still produces seven times more cannabis than it consumes. Local farmers are being regulated out of existence. Tax revenue isn’t yet “filling the coffers” as promised.

 

 


It is failing in Canada, said Dan Bilefsky, the paper’s Montreal-based correspondent, because the nearest licensed shop is a four-hour drive away, in Kamloops, and because illicit dab bars are still operating in Vancouver.

Listening to the two reporters frame the issue, you would have thought legalization has been an unmitigated disaster.


 

 

Fortunately, Hilary Black and Kelly Coulter were also sitting on the panel. Black is the founder of the BC Compassion Club Society—Vancouver’s pioneering medical dispensary—who now directs patient education and advocacy for industry giant Canopy Growth. Coulter is the longtime legalization activist who convinced Justin Trudeau to embrace regulated legalization.

Together, they reminded the Times reporters and the audience gathered in the Vancouver Public Library auditorium that legalization doesn’t happen with the flip of a switch. It took years of arduous work to pass the law. And it will take years of post-legalization effort to move illicit growers and consumers into the legal system.

History Repeats Itself
Here at Leafly, we’ve amassed years of experience covering the rollout of legal farms and stores. And we’ve noticed that the cycles of legalization tend to repeat in each state and province.

The issues the Times reporters aired weren’t fiction. They exist. But they’re bumps in the road, not evidence of failure. We know this because we’ve seen the same issues rise and subside in previous legal states. Fuller and Bilefsky seem to have jumped into the issue during legalization week. Now they’re passing judgment based on some invented criteria of perfection. Remember, Canada started this just three weeks ago.

This Too Shall Pass, Every Time
Here are just a few of the recurring issues that happen in nearly every newly legal cannabis market:

Prices will be high at first. Sometimes outrageously so. That’s how capitalism works. Demand is intense during opening week. Everybody wants to make a historic purchase. But supply is severely limited because licensed stores must, by state law, obtain their supply only from licensed growers or processors. Those growers don’t have a lot of product on hand because they just got their licenses, too. And guess what: It takes time for cannabis plants to grow.


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Some consumers will stick with the illicit market. They’re happy with the product their guy delivers, and it’s cheaper than the stores, so why change? Over time, though, many of these holdouts switch over to the legal market as prices drop and they discover its wider range of clean, tested, reliable products. As they do, more and more illicit dealers drop out of the business. It happens—but over the course of months and years, not days.
There will be product shortages. See under “Prices will be high,” above. Cannabis farmers and processors can’t actually begin making products until they get licensed, and those products need to be tested before they’re sold. There’s no storehouse of products waiting to be shipped.
Only a few stores will be open. Take this as a sign that the state regulatory agency is actually doing its job. In fact, if all stores were to open on the same day—well, that’s a sign of trouble. It takes time for state officials to process license applications. There are background checks to be done. Financials to go over. Interviews to take. Yes, there’s only one licensed store currently open in British Columbia. But there are more in the pipeline. And BC officials are doing their jobs well by not rushing the process.