Leisure marijuana supply is beginning slowly in Colorado

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The supply of recreational marijuana in Aurora is off to a slow start as the cannabis industry focuses on bigger opportunities.

Aurora was the first city in Colorado with pharmacies to choose recreational marijuana delivery, and its first approval was granted in February. Shipments began in March, and several of the state’s larger pharmacy chains with stores in Aurora have since received their shipping permits.

Obtaining a delivery permit requires a lot of work for a pharmacy or a transport service, which must equip their vehicles with tracking and security measures before they train their drivers according to state law. Marketing the delivery successfully, however, could be a bigger obstacle, even with 23 recreational pharmacies and a population of nearly 400,000 in Aurora.

“It’s not competitive at this point. The competition just spreads the word,” said Tim Cullen, CEO of Colorado Harvest Company. “So far, it’s testing a proof of concept and seeing if this can work in Denver.”

A local chain with two stores in Denver and one in Aurora, Colorado Harvest Company was the first to get an Aurora shipping license; seven more were then issued, according to the state’s Marijuana Enforcement Division. But almost four months later, Aurora had only 2,000 pot deliveries, equivalent to about $ 187,000 in sales, according to Aurora’s finance department. That’s an average of about seventeen deliveries a day for a total of $ 1,600 a day in sales – a sliver in a city that averaged over $ 1.2 million a month in local marijuana sales taxes last year alone .

Delivering marijuana is several steps more than selling it in-store, explains Cullen, including two to three ordering and processing platforms, plus the state’s seed-to-sale tracking system, location verification, and payment software to avoid cash.

“There are all these parts going on. We started this idea with the thought that it would be simple, but it’s quite complex. But madness now has a method, ”he adds.

Operations and prices are still evolving, but paying can be the biggest challenge, says Sally Vander Veer, CEO of Medicine Man, a chain of pharmacies with one store in Aurora and one in Thornton, another Colorado town that recently started delivery of leisure pots has yet to implement it.

“It starts slower than I thought. We’re doing some internal tests to see if the delivery price is too high or too low,” says Vander Veer. “The limiting factor is the payment, because we don’t want our drivers to take cash with them.”

Paying for marijuana orders online is banned in Colorado, and the state ban on the plant puts the majority of banks off, so delivery and pre-order services need to get creative. Medicine Man and most marijuana companies that accept electronic payments use third-party platforms that are linked to customers’ bank accounts. In Medicine Man’s case, customers must deposit at least $ 50 to set up their shipping accounts, which is another limiting factor, says Vander Veer.

Denver didn’t start accepting orders until the end of June. With fewer than half of Aurora’s pharmacies using supplies, the companies selling it there see the smaller town as a testing ground and spend relatively little on outside advertising.

Lantern, a marijuana delivery application that provides third-party software to pharmacies and delivery drivers, doesn’t see markets outside of Denver as hungry for delivery, according to President Meredith Mahoney.
“Aurora is a great city and we’re happy to be there, but this city doesn’t necessarily need a delivery like the one in Denver.” she notes. “There are more people driving [in Aurora], it is easier to get to a pharmacy and there is more parking. “

And if this is what the third-party platform feels like, then the marijuana companies could get stuck. Most local governments prohibit licensed marijuana companies from advertising on billboards, but third-party websites like Lantern and Weedmaps don’t have the same restrictions. By the time they decide to advertise heavily in Aurora – or the momentum of Denver’s market eventually spills over – the supply sector could slowly keep moving.

Another factor plays a role: The Green Solution, one of the largest pharmacy networks in the state with five locations in Aurora, has not yet started delivery despite a corresponding agreement with Lantern. While Mahoney wouldn’t comment on when the Green Solution in Aurora would start delivering, she said that one day Lantern would also offer Green Solution deliveries in Denver.

“We always like to move slowly … but we always see business grow,” she says. “It doesn’t just hit, and [then] it’s huge. “

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Thomas Mitchell has been a cannabis-related writer for Westword since 2014, covering sports, real estate, and general news for publications such as the Arizona Republic, Inman, and Fox Sports. He is currently the cannabis editor for westword.com.

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