Marijuana delivery companies seek repeal of two-driver rule
Even before Chris Fevry launched Your Green Package, one of the first licensed marijuana courier companies in Massachusetts, he was worried about whether the business model was financially viable. Could a company act as an Uber Eats for marijuana, delivering products from a retailer to a customer, and earn enough from delivery fees to profit?
“We thought there was a way to actually make it work. And after a year of operating and about 40,000 deliveries under our belt, we find that with the two-driver rule it is literally impossible,” Fevry said on the Codcast this week.
Fevry and Julia Germaine, operating partner at marijuana delivery company KindRun, appeared on the Codcast to discuss their efforts to lobby the Cannabis Control Commission to loosen the regulations governing marijuana delivery businesses. They circulated a petition, which has been signed online by 400 people, urging regulators to eliminate a rule requiring two drivers in each car, get rid of limits on which municipalities delivery companies can operate in, and make other changes to delivery rules as they launch their next regulatory review this fall.
“The second driver is an added layer of complexity that certainly we don’t need,” Germaine said. “We have certain instances where I would want a second driver, in case we can’t park if we’re at a multi-tenant building in Boston. But that’s a business decision.”
Fevry said he had to shut down locations in Worcester and Western Massachusetts because there was insufficient customer interest to justify the cost. He said the region has a lot of dispensaries, so most people can travel only a few minutes to reach one, and many residents have cars. Due to the fixed costs of operating the business, including the two drivers, Fevry said he had to set a minimum order size of $100 – but the average amount a recreational marijuana customer spends is closer to $50.
“For a lot of customers, it doesn’t make sense to order delivery when they can just go right to a dispensary and get it,” Fevry said.
Germaine runs a Hudson-based delivery operator company that serves the region from Worcester to Boston. A delivery operator can buy cannabis wholesale, warehouse it, and sell it directly to customers. Germaine said that model is viable because she can profit by buying cannabis wholesale then selling it at a higher retail price. For her, the challenge is making people aware they can buy cannabis legally through a delivery service. She said rather than trying to change the behavior of existing dispensary customers, her company seeks to identify and market to people who want the discretion and convenience of home delivery, like people who don’t own a car.
“It’s world building here. It’s raising awareness that this service is even available and then getting people through the experience of e-commerce for cannabis,” Germaine said.
The two-driver rule exists for safety reasons – to make it less likely a delivery car will be robbed, and as a precaution against employee theft. But Fevry and Germaine argue that there is no safety rationale for requiring a second person. “It’s more likely for a cannabis delivery driver to get in a car accident than for a vehicle to get robbed,” Fevry said. He said a second person would not help in a robbery, since drivers will give product up rather than fight.
Germaine said given how much security already exists – body cameras, product tracking, etc. – it is a “red herring” to think having two people is necessary to prevent driver misconduct. She attributes that argument to “a deep mistrust in the employee” in the cannabis industry, which she said is unfounded and unnecessary.
The petition also asks regulators to eliminate a rule that only allows marijuana delivery in towns that also allow marijuana retailers or where the governing body specifically approved delivery. An important part of the legalization ballot question gave local control to municipalities to decide whether they want to allow marijuana businesses. But Fevry argued that, when it comes to home delivery, this should be a personal choice. “The municipality should have no authority over what a private citizen orders to their house,” he said.
The petition also asks for the elimination of a ban on marijuana delivery on hotels. “We are now a weed tourism state, but delivery doesn’t get to participate in that,” Germaine said.
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