Maine’s cannabis caregivers are facing a tightening market burdened by the possibility of new state licensing requirements. The state is considering new rules for medical cannabis, which may include a tiered licensing system that differentiates between caregiver businesses based on size.
“Yeah, we have quite a few caregivers and it always seems to be expanding and people drop in and people drop out,” said Kristi Shaw, co-owner of Northeast Growing Co. “People who are going to drop out, now is the time to do it because the market is definitely flooded. And I think this is where a lot of people are going to sink or swim.”
Shaw is one of over 3,000 people with caregiver licenses in the state, which allows her company to grow a small amount of plants, and sell directly to patients or wholesale to other caregivers with storefronts.
“We are a very small business. It’s my husband and myself. And we have one employee,” she said. “My husband does the majority of the growing and I do the trimming and the delivery and the marketing and all of that stuff.”
Voters in Maine legalized medical cannabis in 1999 through a ballot measure. About a decade later, the legislature updated its rules for medical cannabis through the Medical Use of Marijuana Act. In part, the new law allowed for medical cannabis caregivers to essentially act like microbusinesses.
“I worked with a group of caregivers to really build the caregiver model in Maine in 2011,” said Paul McCarrier, owner of 1 Mill, a caregiver business based out of Belfast, Maine. McCarrier oversees a small medical operation that includes cultivating about two and a half dozen plants at a time, with a storefront and a bakery to produce edibles.
Shaw said that she was a long time user of cannabis and lived in California for about 13 years with her husband before returning to Maine with the intention of entering the medical cannabis market.
“We heard the medical market was taking off and we really wanted to be legitimate,” she said.
Northeast Growing Co. continues to be a relatively small company, with most of the business coming from wholesale.
“I’m driving all over the state weekly, pretty much just going into any shop that I can find,” she said. “I study Weedmaps to find new shops I haven’t been to yet, or I’ll just drive around and see what I can find.”
McCarrier said that he worried that new regulation would primarily harm smaller operations.
“Now the biggest challenge is the state continuing to try to put regulations on micro and small businesses, which puts them at a disadvantage to the larger businesses. It’s a very competitive market place,” he said.
He added that boxing out smaller businesses through regulation would only create more opportunities for the illicit market to fill that void.
“The biggest thing that I see is that the illicit market is undercutting my prices. We tell you what the price is and when we sell an ounce for $200, someone else will sell it for $150. There isn’t a public will or a push from law enforcement to make cannabis a priority,” he said. “Why would you want to spend tax dollars to go after Bubba selling ounces out of his trailer.”
Shaw said that she definitely sees the illicit market as a major source of competition.
“The market is flooded and that good amount of it is coming from the West Coast is the rumor,” she said. “You don’t know for sure but I kind of suspect I know that the distillate market has been flooded for a long time and that is something that’s really hard to trace across state lines. It’s a pure product, you know. You can’t smell the fires of California in your distillates.”
Much like Shaw, McCarrier also expects more caregivers to leave the business in the future due to over-saturation.
“People don’t know the extent of what it takes to run a business. People also think that it’s easy money. The easy money was done eight years ago. Now it’s a real business.”