Future of Marijuana Industry?
If 1 positive thing came out of the 2020 elections, it clearly was legalization of Marijuana in more states.
Right now I'm pretty bullish on the whole industry but Marijuana industry has problems of its own of course.
Here's my take on some of the potential issues in this industry.
1) It's being invaded by crony corporate interests. Okay corporate interest brought a whole lot of research, innovation, and knowledge to the consumers. But at the same time, lots of regulations on who gets to sell is allowing small number of connected few to form "cartels" and exercise monopoly like behavior (crack down on small players, raise prices, etc...). Small time home-growing sellers are still getting arrested and people are noticing. Who knows if one of the biggest issues 10 years from now might be Big Marijuana?
2) CBD is clearly less regulated. In fact, you can order CBD products across state borders like you buy multi-vitamins. But there are literally countless number of CBD products it seems. There are CBD beers, CBD drink mixes, CBD powders, CBD gummed, oils, chocolates, you name it... Monopolistic competition indeed. Most of these small players seem vertically integrated as well.
But who knows, maybe there might be some serious M&A action in the future once someone realizes all of it can be scaled ? Would there be more horizontal integration happening down the line? Or would this space continue to be a cut throat space with new entrants constantly coming in and old ones going bankrupt?
TL;DR: Would the marijuana industry be a collection of few big players (ie. Tobacco industry), collection of uncountable small slightly different players (ie. Restaurant industry), or somewhere in the middle (ie. Beer industry with handful number of big players and massive number of local craft breweries)?