When most people think of the cannabis industry, they typically think of dispensaries; the retail side of cannabis operations. Dispensaries are a key component in legal marijuana, but it was not until 2014 when Veritas Fine Cannabis was issued the very first non-vertically integrated recreational wholesale cannabis license in the state. This caused a positive shift in the industry as a whole and has impacted the retail cannabis industry in a positive way.
From 2010-2013, only medical marijuana dispensaries operated legally in Colorado. When the laws were being written for the legal sale of medical cannabis, the 70/30 rule was put in place, requiring that Colorado medical dispensaries were to be 70% vertically integrated businesses. This meant that cannabis companies needed to own 70% of all stages of their supply chain, opposed to working with a third party cultivator. The remaining 30% left room for edible and topical products to be wholesaled from third-parties, so dispensaries needed to obtain their flower from their own medical grow.
Every medical marijuana dispensary license had a corresponding medical marijuana cultivation license attached to it for legal operation. On July 1, 2018, the 70/30 rule was phased out and on July 1, 2019, it was no longer required allowing for the wholesale of medical flower to dispensaries from third-party vendors.
On the recreational side in 2012, Amendment 64 passed, making Colorado the first state to end marijuana prohibition. On January 1, 2014, the first recreational marijuana dispensary in the United States opened in Denver, Colorado. In 2014 when recreational dispensaries opened for business, there was never a mandate issued for vertical integration written in the laws, which created a market for wholesale recreational cannabis companies (ie: Veritas Fine Cannabis).
In wholesale cannabis, the company strictly operates in cultivation, packaging and order fulfillment. There is no dispensary attached to the license or business. Wholesale cannabis companies simply grow weed and sell it to dispensaries. When Veritas entered the recreational Colorado cannabis market in 2015, it was uncharted territory. As the first ever issued wholesale recreational cannabis license holders, it was time to lead the industry in a way that hadn’t been done before; focusing 100% on the cultivation of high quality cannabis.
Today, there are hundreds of licensed cultivation facilities in Colorado, where both medical and recreational dispensaries can purchase all of their products through third-party companies.
It’s been a wild 10 years of legal weed and we can’t wait to see what comes next!