Cannabis has been a big buyer of out of home advertising. You might want to have your out of home credit manager keep close watch on your cannabis clients.
Wholesale Cannabis prices declined by an average of 27% in 2022 due to an increase in legal cannabis outlets. There are signs that pricing is stabilizing but the state of California has shifted the excise tax burden from wholesale to retail pot shops. California pot industry facing extinction event screams one headline.
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As you may or may not be aware, on July 1, 2023, recreational marijuana use will be officially legalized in the State of Maryland.
Because of this change in the law, one of our clients (WAAVE Medical Marijuana Dispensary) received notice on Friday, May 12, 2023, from the Maryland Cannabis Administration, stating that they must sign an attestation that they will comply with the new advertising regulations that were part of the lager cannabis reform bill that passed and was signed by the Governor last week (please see page 82 in the following link for the advertisement regulations: https://mgaleg.maryland.gov/2023RS/Chapters_noln/CH_254_hb0556e.pdf
Based upon this signed legislation from the Governor of Maryland, the State is banning OOH: “ENGAGE IN ADVERTISING BY MEANS OF PLACING AN ADVERTISEMENT ON THE SIDE OF A BUILDING OR ANOTHER PUBLICLY VISIBLE LOCATION OF ANY FORM, INCLUDING A SIGN, A POSTER, A PLACARD, A DEVICE, A GRAPHIC DISPLAY, AN OUTDOOR BILLBOARD, OR A FREESTANDING SIGNBOARD.”
It is unfortunate, as we were able to have these dispensaries as clients when it was classified at “medical.” The challenge is that these dispensaries will all provide for recreational use as of July 1, 2023, because there is a significantly larger marketplace.