MedMen Enterprises (MMNFF) recently opened two new stores in Florida, in central Orlando and Tallahassee. Currently, the company already has seven stores in the state. Plus, the company plans to open five more stores by the end of 2019.
Cannabis market in Florida
As one of the most populous states in the US, Florida legalized medical marijuana by state constitutional amendment in 2016. Known as Amendment 2, this ballot initiative received a 71% vote. Under Amendment 2, physicians could administer medical marijuana if they believe it would reduce a patient’s potential health risks. Presently, Florida has a robust medical cannabis program that has served more than 250,000 qualified patients through August 30, 2019.
According to ArcView Market Research & BDS Analytics 2019 update, Florida’s medical cannabis market could reach $1.6 billion by 2022. According to Statista, medical marijuana sales are expected to reach $2.5 billion by 2025.
Recently, the constitutional amendment campaign, “Make It Legal Florida,” was launched to legalize regulated recreational marijuana for adults. MedMen is one of the leading supporters of this initiative. Notably, MedMen VP Nick Hansen is the chairperson of this campaign.
Analysts describe Florida’s cannabis market as an oligopoly. At this time, a few vertically integrated operators dominate the market. Trulieve (TCNFF) is the largest player in the Florida cannabis industry, with 37 retail operations across the state. Other players include Curaleaf (CURLF), Surterra, Liberty Health, MedMen (MMNFF), and Fluent.
The positioning of the new stores
One of Florida’s largest cities, Orlando has a population of nearly 298,000 residents. The city is a highly popular tourist destination, as it is home to more than a dozen theme parks—particularly the expansive Disney World theme park and resort. At this time, Orlando has over 10 medical cannabis dispensaries.
As Florida’s state capital, Tallahassee is also one of the largest cities in Florida. With a population of about 196,000 residents, Tallahassee has seven operational medical cannabis dispensaries.
MedMen’s loyalty program, called MedMen Buds, is expected to be available in the new locations. By using MedMen Buds, patients can earn loyalty points and redeem them in future purchases. Plus, patients can receive discounts. MedMen’s same-day delivery platform would be available to patients in Florida, which were previously available only in California and Nevada.
MedMen’s primary strategy is to increase its retail footprint and become a leader in the industry for omnichannel delivery. At this time, the company has 32 operational stores, out of which seven are in Florida. By the end of the year, MedMen plans to open five more stores in Florida by the end of this year, in Jacksonville, Fort Lauderdale, Deerfield Beach, and Sarasota. MedMen’s license allows it to open 35 stores in Florida.