Matt Haney recently introduced Assembly Bill 374 that would allow cannabis retailers in California to operate kitchens and host live events at their stores. The bill would remove some of the biggest restrictions on cannabis consumption lounges. In fact, it would allow dispensaries to serve prepared foods and coffee, as well as have live entertainment.
Since California has strict rules, revenue generation at consumption lounges is a major challenge for licensees prohibited from preparing and serving food and beverages in-house, since they are forced to let third-party providers handle those tasks.
Currently, most consumption lounges in California are essentially cannabis smoking rooms, although some have partnerships with local cafes and restaurants to deliver food and beverages to consumers in the lounge; which are typically ordered virtually. By delegating food and beverage services to these third-party providers, however, there is lost potential revenue in every sale.
Thus, this bill has the opportunity to open many doors for businesses in the cannabis industry looking to expand their operations. It is important to emphasize, however, that this bill does not mean coffee shops can sell cannabis, just that cannabis shops can sell coffee. Thus, this change primarily impacts cannabis dispensaries looking to expand their services to include food, beverages, and entertainment.
California currently has a few dozen cannabis consumption lounges, most of them being in the Bay Area. The success of these current lounges elucidate there is opportunity for extra revenue to any businesses who take advantage of the new bill. Overall, AB374 has the potential to bring in extra revenue for cannabis dispensaries by expanding their service options.
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