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Imagine buying cannabis straight from the farmer.
Legislators in Olympia are considering a bill that could upend the business model of the state’s cannabis industry, by bringing it in line with every other legal business in Washington.
Senate Bill 5403 proposes legalizing direct producer-to-consumer sales of cannabis.
Currently, the state requires producers and processors of cannabis to go through an intermediary — licensed dispensaries — to bring their products to the public market.
If passed, SB 5403 would allow producers and processors to sell directly to consumers, much like how alcohol producers — think breweries or wineries — are allowed to sell directly to consumers while also having their products on store shelves.
For cannabis producers and processors, especially smaller ones, this could be a game changer.
“It would open up another revenue stream,” says Libby Rindal, part owner of Lilac City Gardens, a local cannabis producer. “If a farm could have a way to sell their products retail to the average consumer, they could make that retail profit instead of someone else.”
SB 5403 had its first public hearing on Jan. 27 and is scheduled to have another, in the Senate Committee on Labor & Commerce, on Feb. 14.
The bill, sponsored by Sens. Rebecca Saldaña, Deborah Krishnadasan and T’wina Nobles, three Puget Sound-area Democrats, aims to “[support] a sustainable cannabis industry.”
Currently, the state’s three-tier system for producers and processors puts limits on the amount of space and product that growers and manufacturers are allowed to occupy and produce. The impetus behind the three-tier system, which has been in place since legalization was first adopted more than a decade ago, was to allow for small businesses to coexist alongside larger producers.
While that has happened, things haven’t been easy for the smaller producers in Washington.
The bill recognizes this reality, stating that “due to the federal legal landscape, all cannabis produced within Washington must stay within the state’s borders, which can cause downward pressure on prices that threaten the ability for small and independent producers to stay in business.”
Rindal’s experience confirms that sentiment.
“There’s only so much shelf space,” Rindal says. “Smaller companies might not have the opportunity to get their product to a customer without being able to negotiate with retailers who have no reason to buy their cannabis when they can buy all of the other well-known cannabis that’s available.”
SB 5403 would give all cannabis producers the ability to sell directly to consumers, but for smaller producers that have been squeezed by the highly regulated market, it could be a lifeline.
“}]] Legislators in Olympia are considering a bill that could upend the business model of the state’s cannabis industry, by bringing it in line with every… Read More
