Oklahoma’s marijuana industry has been growing at a rapid rate and a lot of sectors are benefitting from this. It was just recently approved and is now hitting the sky with lots of applicants and licenses approved every month.
But at this rate, it might do more harm than good. While it may look good to some, it might just be a bubble waiting to burst. It’s growing at such an alarming rate that adjustments have been made, even for the agency. Will the bubble burst?
Thousands of Licenses Approved
Ever since the Oklahoma Medical Marijuana Authority (OMMA) started accepting applications from businesses, the number of applicants just kept on increasing. Thousands of applications were sent and a lot of them were approved.
OMMA has its own Twitter account where it constantly updates the number of card or license applications being received from patients, caregivers, and businesses. The number of business license applications is further broken down to growers, dispensaries and processors.
OMMA tweeted on June 17, 2019 that they have received over 5,800 business applications. Previously, they have already approved about 3,211 growers, 1,548 dispensaries, and 859 processor licenses.
This rate gives us the idea that the numbers will not go down anytime soon. In fact, it might just spike up before the year ends. There’s a lot at stake with the growing numbers and the bubble might just indeed burst before we know it.
Customer to Dispensary Ratio
Indeed, more than a thousand dispensary licenses have been approved. It’s a clear sign that lots of Oklahomans wanted to put up their own dispensary. It’s not a wrong thing to venture in this million dollar market.
After all, a lot of opportunities were created. From jobs to new kinds of skill sets, it was surely enticing to participate in it. But with such a large number of dispensaries open, the ratio of customer to dispensary is also dropping at a fast rate.
As of the moment, the estimate number of customers each dispensary might have would be around 77 patients. That would be okay, if these customers buy the maximum. But it could also mean that the dispensary would meet their breakeven.
The number of patients might be increasing but so are costs. These dispensaries are taxed pretty high which eat up most of their profit. And those who didn’t anticipate such changes would not be able to make profit and would soon close down before the year ends.
This kind of situation isn’t new. This happened in a lot of other states, with the first year of legalization looking so promising. But all of that toppled down when more regulations come in and the costs get harder and harder to balance.
All these dispensaries can do is to fight for the top spots and create a pool of loyal customers. Once they’ve established that and surpass breakeven sales, they might have a chance at lasting in the industry.
Different Kind of Obstacles
Another obstacle that the medical marijuana industry faces is that banks don’t want to deal with anything that’s related to it. On the federal level, MMJ is still an illegal drug and it has not yet been approved by the FDA.
This means that most banks would shy away from dealing with businesses that are part of the industry. It’s a really difficult position to be in since business owners need to place there cash somewhere, and if banks won’t allow it, where else would they put it?
It’s also a question on how these business owners could expand their business if they’re not going to be approved for loans or any credit in the future. The industry has been earning millions and it’s already becoming a headache talking about storage.
Insurance companies also shy away from insuring cannabis businesses because they’re afraid of getting into legal perils in the future.
It’s not just the businesses who are directly connected to marijuana that are struggling, but it’s also other businesses who give them supplies or even landlords who rent out spaces. There are so many consequences that stem from having any kind of interaction that most of these businesses are at a buzzkill.
As you can see, it’s just that increasing number of applications that would be a threat to the whole industry, but even banks, insurance firms, or landlords could burst the bubble. While the industry is still approaching the peak of its success, it might just hit rock bottom sooner than we think.
Let’s just hope that the OMMA would find ways to slow down on the number of licenses approved and find ways to help these business owners transact legally. If something won’t be done, it’ll just burst one of the most promising bubbles we’ve had in year. To know more about medical marijuana in Oklahoma, visit this website: https://www.veriheal.com/oklahoma/.