By Sasha Nutgent, VP of Cannabis Retail at Housing Works Cannabis Co
Five years after New York created the Office of Cannabis Management (OCM), the state’s legal cannabis industry is still finding its footing.
When New York created the OCM, it felt like the state had a chance to rewrite the cannabis playbook and address many of the harms created by the War on Drugs. With lessons learned from markets like Colorado and California, the hope was that New York could build an adult-use system that worked differently.
From where we sit today, the reality proved more complicated. The last five years were defined by urgency, growing pains, and real setbacks—but also resilience, learning, and a cannabis community that refuses to give up on the vision that brought us here.
Opening Under Pressure
At Housing Works Cannabis Co.—the first licensed adult-use dispensary in the state—we’ve had a front-row seat to both the chaos and the progress. We opened at the end of 2022 under circumstances no retailer would ever plan for. To meet the state’s goal of launching legal adult-use cannabis sales before 2023, the retail team had roughly one month to hire and train staff, learn brand-new regulations, finalize a lease, and build a fully compliant operation.
It was chaotic. There’s no other way to put it.
At the same time, it was historic. Customers were excited. Brands were eager. There was a real sense that we were part of something bigger than ourselves. But behind the scenes, systems were still being built. Regulations were vague, and getting help to understand them was challenging. Many operators, particularly those from social equity pathways, had to navigate dense regulations on their own, without consultants or legal teams to guide them.
The whole state was building the car, publicly, as it was being driven.
The Struggles No One Likes to Admit
Let’s be honest: The car isn’t a luxury ride, and the road is rough. Despite generating over 2.5 billion in sales, profit margins are razor-thin as there are currently over 582 adult-use dispensaries in the state, and competition is steep.
Staffing’s a constant challenge. Unlicensed businesses proliferated in the early days, undercutting the legal operators. Compliance often feels like trying to hit a moving target. Major changes, like the sudden rollout of the mandatory track-and-trace system METRC last year, were introduced with little warning and aggressive deadlines. Everyone, from retailers to brands, struggled to adopt an entirely new system over the holidays when most “mainstream” retailers were winding down.
For many license holders, especially smaller businesses, this created serious financial strain. Some never recovered.
The original equity vision behind New York’s rollout hasn’t fully materialized. At nearly every Cannabis Control Board meeting, operators voiced frustration about delays that kept licensed businesses from opening. As soon as large multistate operators began entering the state, support for small and social-equity businesses declined. Many license holders found themselves carrying debt, sometimes in the millions, for stores they weren’t allowed to open on time, and that reality has been heartbreaking to watch—and impossible to ignore.
What’s Actually Improved
Despite all of that, things have gotten better.
One of the most meaningful changes has been communication. The OCM isn’t perfect, but it’s easier to get support than it was at the start. Questions that once took months to answer now often get responses within a week. Guidance is clearer for brands and retailers alike.
That may sound small, but in a heavily regulated industry, clarity is everything.
Brand relationships have also matured. Early on, there were fewer brands and little capacity for education or in-store activations. The focus was simply getting products on the shelf. Today, brands like Back Home Cannabis, Florist Farms, Ayrloom, and Foy are more sophisticated and commit resources to retail partnerships and consumers alike. They have teams, marketing strategies, and a real interest in customer engagement. It means retailers can be more intentional about who they partner with, resulting in collaborations where both parties are vested in sell-through.
A Smarter Cannabis Consumer
That partnership is needed, as New York cannabis consumers have changed dramatically since the first sale in December of 2022.
In the beginning, most people walked in asking for the highest THC percentage, full stop. That kind of shopping makes quality inconsistent and makes it harder to build brand loyalty.
The mindset shifted. Consumers aren’t just buying THC anymore; they’re buying smarter.
Today’s customers shop for effect, terpene profiles, and value—not just potency. Larger formats like 14-gram and ounce bags of flower, called smalls, have become popular as people look for better bang for their buck. Price compression has reshaped expectations for profit margins. What once cost $65 or $70 could now cost half of that, which has no doubt put pressure on brands and retailers to get smarter with their marketing.
Recent regulatory changes have helped. Loyalty programs—once prohibited—are now allowed. We can market more openly through email and social platforms. These tools are basic in most industries, but in cannabis, they make a real difference, especially as larger players with bigger budgets enter the market.
Cleaning Up the Illicit Market
Another real improvement has been enforcement. When we first opened, unlicensed cannabis was everywhere. Bodegas, pop-ups, and temporary storefronts seemingly appeared overnight. The market for hemp-derived, intoxicating THC products has also been a huge competition, but today, enforcement is more visible, and unsafe products are being taken off the streets.
Building trust in the legal market is something the state desperately needed to do, and it’s heartening to see progress. However, inversion is still a common problem, and despite the state’s best efforts to crack down on unregulated sales, unlicensed products end up in stores.
Five Years In, Looking Forward
Five years after the OCM was created, I can say this with confidence: It is easier to operate a licensed cannabis business in New York now than when we opened.
Not because the industry is easy—it isn’t—but because there’s more understanding, more experience, and more shared knowledge. We’ve built stronger relationships with each other. We’ve learned how to navigate the system. We’ve developed resilience and a community.
Retailers, brands, their employees, and consumers are engaged, vocal, and invested in getting this right. If the next five years are shaped by listening, adapting, and continuing to prioritize local business ownership over profit and corporate MSOs, New York still has a chance to become the market it set out to be.
