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Why legalized weed could be a boon to the restaurant business

Restaurant Business

Canadians were ahead of us on poutine, hockey and Jim Carrey. Now they’re about to beat the U.S. restaurant market to a sales igniter that’ll make the delivery boom feel like landing one more cover on a Friday night. As you read this, our restaurant neighbors to the north may already be plotting how they’ll ride the Mars shot of having recreational cannabis legalized across their republic.

If you wonder how that’ll likely go for them, ask some colleagues in Colorado, the pioneer of legalized recreational pot use. Tourism has soared, the state’s tax coffers have swelled, and sleazeball street dealers have poofed into history. Judged from purely a business standpoint, the change has been a monumental positive.

The big negatives for restaurants: more competition for labor, since there’s so much money to be made in the state’s thriving new green business, and a lack of clarity on how to capitalize on the boom. But there’s not much complaining to be heard. Operators are too busy reaping the benefits.

And it can only get better for restaurants, as a panel observed during May’s National Restaurant Association convention in Chicago. There’s still a Wild West dynamic to the Rocky Mountains scene, the experts in that session agreed. Regulations spell out where and how cannabis can be sold in Colorado, but they stop short of saying where it can be consumed, an oversight that’s just starting to be corrected. The state is leaving those guidelines to local jurisdictions, an approach that usually takes time and results in a hodgepodge of do’s and don’ts.

In the meantime, restaurants can’t legally put it on the menu. The closest lawmakers have come is permitting social consumption—advocates’ term for letting consumers use marijuana in a public place like a restaurant—in Denver. The result is a new cafe called The Coffee Joint, the lone outpost as of this writing where patrons can openly buy and indulge in cannabis.

But, the panelists agreed, that’s certainly going to change, and pronto. They predicted marijuana restaurants will spring up in Colorado and Nevada, a state similarly mute on where marijuana can be legally consumed, as early as next year.

But back to Canada, eh? With true American egocentrism, few residents of North America’s Big Kahuna may have noticed that legalization of
recreational marijuana use was greenlighted there in June.

As in the States, lawmakers have been narrowly focused on the fundamentals. For instance, foods and beverages infused with cannabis likely won’t be covered in the new regulations, or at least not at first. And experts agree that edibles, as they’re called, will most likely be the way consumers come to enjoy cannabis in social settings like restaurants.

Still, Canadian operators will likely have a lead over their American cousins in partnering with deep-pocketed food companies that want a piece of the booming legal cannabis market (it’s expected to hit $22.6 billion in 2021). Licensing a restaurant’s name or recipes for cannabis-laced food products will be the way big consumer packaged goods corporations get that foothold, the panelists predicted.

So what can American operators do to share in the legalized-cannabis boom? First, put a match to the fuse by landing on the side of legalization. The stigma and controversy about using weed is quickly waning, and the business argument is compelling. Be part of it. Nine states currently permit recreational use, and that number will only rise. Give your state lawmakers cover to support it by emphasizing the benefits over the perceived risks.

Second, sound off about restaurants being at the table. Early legalizers didn’t extend the permissions and rules to cover social consumption. Be sure your state doesn’t make the same mistake.

Canada will likely be willing to share the buzz. After all, it gave us both Martin Short and Neil Young.

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