Under New Rules, California Edible Makers Are Getting Left Out in the Cold

The popularity of cannabis edibles has exploded in recent years, especially since the legalization of adult use marijuana in 2016. But California's new legal framework hasn’t necessarily been good for business, as a piece from Green State illustrates.

Thanks to onerous requirements in cities and counties across the state, small-scale pot candy and brownie manufacturers are being squeezed out of the market at an alarming rate, with one expert predicting “an extinction event” for 75% of exiting edible manufacturing businesses.

That’s because most bakers live in a city or county hostile to their businesses. The cooks who can get licensed in a friendly city face steep rents, new taxes and fees that eat up any profits from the enterprise.

According to industry consultant Sean Donahoe, California’s cannabis industry is on track to follow Colorado and the rest of mainstream American business — where the forces of regulation and consolidation leave the bulk of commercial activity in the hands of the few.

“I’m seeing a lot of these similar things and then some,” Donahoe said. “And it didn’t have to be this way.”

Cities and counties can created friendlier ground for these enterprises by allowing small kitchen shares and reducing the cost of licensing. If they don’t, they risk partial collapse of the sector.

But the new rules are tough for a reason. Under the old system, problems with edibles were rampant. Dosing problems, label inaccuracies, and underage consumption were just some of the hazards that accompanied an unregulated system.

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