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A Guide to Owning an Arizona Cannabis Delivery License
Arizona Cannabis Delivery License
If you’re looking to open a cannabis delivery service in Arizona, the first step is to apply for an Arizona cannabis delivery license. Arizona is among the US states to have recently legalized recreational adult-use cannabis after voters passed Prop 207. This campaign was led by the Smart and Safe Act of Arizona, which received millions of funds from the top cannabis businesses in the state. The act allows anyone over the age of 21 to legally purchase an ounce of cannabis. A 16% tax will be levied on the sale, which can help support the state’s health programs, community colleges, public safety, highways, and roads.
Home to 7.2 million people, Arizona has a vast market for cannabis. So it does not come as a surprise why many would be interested to invest in this industry. In fact, the medical cannabis industry in the state is thriving. With the legalization of recreational cannabis, the market is expected to grow even more, thanks to the Smart and Safe Act, which is projected to bring in $300 million in tax revenue.
The cannabis industry can open lots of opportunities. Aside from cannabis dispensaries, several other businesses can come out of it. One of these is the delivery business. But then again, before you can open this type of business, you must first apply for an Arizona cannabis delivery license.
Opening a Cannabis Delivery Service in Arizona
Whether you are launching a delivery-only business or adding a delivery service to your existing cannabis business, there are many factors that you need to consider. From complying with the government regulations to understanding your customer demographics and acquiring an Arizona cannabis delivery license, you must be aware of all these things.
Since adult-use recreational cannabis is still a new market, you can expect to face many challenges as you launch your delivery service company in Arizona. But if you come prepared, you should be able to launch your business in no time.
Just like with the other states who have just legalized the use of recreational cannabis, the cannabis regulations in Arizona are still not that comprehensive and different cities have their own sets of rules as well, which makes things even more complicated. But the key to achieving success in this kind of business is to have a flexible business plan and accept changes along the way while Arizona is rolling out its statewide rules and licensing.
Tips for Operating a Successful Cannabis Delivery Service in Arizona
Opening a new cannabis business can be daunting. It’s always important to come prepared especially since the industry is still new. To help you with this, here are some tips for operating a successful cannabis delivery service, coming from the experts.
- Know the Rules and Regulations
While several US states are now legalizing cannabis, some states still consider it an illegal substance, so it’s very important that you know the cannabis rules and regulations before you get started with the business.
Many times, when state regulators would talk about the idea of allowing the delivery of cannabis, it is often thought about as something in the black market. But it is actually just a different way that people can order cannabis products, and it can be just as safe as a typical cannabis dispensary. In fact, it may be safer since you will not have any customers on-site. There will be no nuisance to it, and you will not have that many people loitering outside.
In a cannabis delivery service, both the cannabis products and cash will be stored and processed in a more secure place. This is much safer compared to an actual dispensary since the products and cash won’t be easily accessible to customers. However, state regulators would require that the delivery service companies will have a baseline of security that’s similar to cannabis dispensaries. This includes having locks and alarm systems that meet certain standards of quality. They would also require having a safe room where cash and cannabis products will be stored.
Video surveillance is another important requirement that authorities would require for cannabis companies, including Arizona cannabis delivery services. There is also a certain requirement for the quality of the video and on how long the video footage will be retained on-site.
There are also rules and regulations on how cannabis products will be delivered in Arizona. It is important that you know these things before opening your delivery company. In states like California, authorities have required having a physical address of the client or customer. This means that you cannot just deliver your products to a gas station in the corner or in any other public place that has no complete address.
Companies are also required to verify that the delivery will be made to a customer of legal age. As what was stated on the Arizona cannabis laws for recreational cannabis, the user should be at least 21 years of age. As for medical cannabis, the customer must possess a valid medical marijuana card.
It’s also important that the drivers will be licensed and insured. If possible, a GPS device should be installed in the vehicles allowing for remote tracking. As the regulatory and licensing processes in Arizona continue to roll out, it’s important to take a conservative stance when opening your cannabis delivery service and anticipate what the rules might be.
- Understand Your Market
Next, it’s very important that you understand your market and know who your potential clients are. What’s important about delivery services is that it has a much different market than the dispensaries. People who will be using the cannabis delivery service are a totally different demographic than those who will use the dispensaries. In most cases, the clientele tends to be older. These are people who find it more convenient to have their products delivered than going to the store themselves.
For the medical cannabis market in Arizona, you can expect that people who will use the delivery service are those with reduced mobility or those that would prefer a more private interaction, something that they won’t get if they will order from a storefront.
- Develop Trust with Your Customers
Establishing relationships with your customers based on trust is also critical to the overall success of your delivery service.
You need to always think about what will be the safest option for your employees, drivers, and customers. Always make sure that the product you are providing is of high quality. Unlike with buying directly from a store, customers cannot ascertain by merely looking at your website or by calling you if the products are of good quality. By consistently offering high-quality cannabis products, you will be able to easily build customer loyalty.
When running a cannabis delivery service in Arizona, you need to establish a relationship with your customers. This is the only way to earn the trust of your customers. By providing them with products that are more satisfactory compared to cannabis dispensaries, your customer will most likely prefer to avail of your service instead of buying the products from somewhere else.
- Educate your Customers
Since adult-use recreational cannabis is still a new industry in Arizona, most of your new customers might not be familiar with it. They could find the rules and regulations confusing and frustrating.
Since this is a new industry, you will have to introduce your customers to the very idea of this industry. You need to make your customers understand the very complicated regulatory framework since there will be lots of frustrations that the customers could feel when buying cannabis in Arizona. Make sure that you follow the rules and regulations applicable to your business operations and possess a valid Arizona cannabis delivery license. Above all, it’s important that you maintain a certain level of security and safety for your business, and ensure you pay the appropriate taxes.
As a cannabis delivery service in Arizona, you must be willing to teach your customers about what cannabis is, the many different forms of cannabis products, what they can do, and how to consume them safely for a more enjoyable and satisfying experience.
- Get Creative with Advertising
Advertising can be tricky for any type of cannabis business, and a cannabis delivery service is no exception. So you can expect that advertising your cannabis delivery service in Arizona could come with a few challenges.
Advertising a product online that’s federally controlled can be difficult. Therefore, you can only rely on traditional methods. But try to be a bit more inventive and don’t underestimate the power of “word of mouth” advertising.
Cannabis companies in Arizona must be familiar with the different advertising regulations in the local communities and experiment with different methods to find what works best for your delivery service company.
- Build Your Business Model Accordingly
Applying trial and error is the best way to understand the cannabis market and accordingly adjust the business model for your cannabis delivery service. Companies should not try to reinvent the wheel. For instance, there are not many point of sale systems available for the delivery aspect of the cannabis industry just yet. But by looking at the manner in which other industries have handled the fulfillment of orders and offering delivery service, the cannabis industry should be able to find solutions.
In some ways, look at the best practices that fulfillment operations and shipping operations have applied. There are several other businesses that have already applied the concept of delivery services. By simply looking at what these companies are doing and integrating their best practices into your own business, you would be able to make your cannabis delivery operation successful.
Another thing you should do is to determine the range of your delivery area. Remember that it’s different for everyone. Some companies could cover large regions while others would prefer to focus on smaller communities. This is just another case of seeing what is more profitable for your business.
When opening a cannabis delivery service in Arizona, one should assess how receptive the surrounding community is, how much area can be served, and how much will it cost for the driver to travel to certain areas in Arizona.
In a dense urban area, such as in Phoenix, you might have a high concentration of customers here and the traffic might not be that bad enough that your delivery drivers will be spending a lot of time on the road. However, you also need to consider the fact that you could face a lot more competition in this area. But if you focus your delivery in suburban areas like Scottsdale and Gilbert, you can expect less population density, but then you will have less competition as well.
While most of the cannabis delivery services would prefer to purchase their products from third-party suppliers, a vertically integrated business model could work for your delivery service too. There’s not any downside or benefit to this, but make sure you can handle the logistics aspect.
In some other states, there are companies that would cultivate cannabis products and run a delivery service at the same time. But they find that it’s just too much for them to handle. Aside from making sure that the quality of the cannabis they cultivate is high, they also need to make sure that their delivery service is prosperous. But then again, it’s different for everyone. Some companies might be able to run and manage multiple businesses at once.
- Get Involved with Trade Associations
Joining trade associations in the cannabis industry of Arizona is one of the most important aspects to consider when running an Arizona cannabis delivery service or any cannabis business for that matter. Getting involved with these trade associations can greatly benefit your company in so many ways.
Member companies can communicate how they operate their respective businesses and learn a lot from the regulators. It also helps companies to understand where the regulators are coming from when creating the cannabis regulations in Arizona.
Conclusion
The cannabis industry is moving forward in business opportunities with no signs of stopping. One sector that people should be keeping their eyes on is delivery. While the rules and regulations on cannabis delivery in Arizona have not yet been fully established, you should do your research as early as possible if you want to get into this kind of business. Cannabis legalization continues to heat up across the United States so we can only expect that the cannabis companies in Arizona will step up to their game to meet the growing demands. By acquiring an Arizona cannabis delivery license, you will be able to deliver your products anywhere in the state, which is a great opportunity to expand your cannabis business.
Learn more about any of the Arizona Cannabis License Laws below: