The Role of Small Business in the Evolving Cannabis Industry

Abstract

As the legal cannabis sector grows and state markets mature, small businesses within the industry are struggling. Now is an opportune time to examine the role of small businesses in the cannabis reform landscape. With federal legislation on the horizon, policymakers require reliable information. Unfortunately, research on the issue of small cannabis businesses remains sparse.

In this paper, we argue that small cannabis businesses foster local economic growth and contribute to the public good. Additional research is necessary, particularly to compare findings from states that are already taking measures to safeguard and financially support specific types of small businesses. In the interim, we recommend the exploration of immediate solutions, beginning with (1) access to SBA loans, (2) systematic data collection and potential expansion of state measures such as fee waivers and licensing prioritization, and (3) consideration of lower-cost regulations for small businesses. Various relevant federal bills are listed and briefly analyzed in the Appendix.

Keywords: Cannabis industry, small businesses, small business association, marijuana reform, MSOs, social capital, local economies, cannabis social equity, small business loans, CDFIs, MDIs, microbusinesses, cannabis policy, cannabis legislation