The expansion of legal marijuana to 39 states and the District of Columbia has created an entirely new industry just waiting for eager entrepreneurs to develop. And develop they have. Over the last several years, the legal marijuana industry has seen many innovations. One of them is adoption of the convenient store model. Producers want to sell their products at convenience stores under a co-located store arrangement.

A co-located arrangement sees two retail partners operating in the same physical space. The main convenience store brand might occupy 75% while a pizzeria operates in the remaining 25%. Both are within the same store footprint but do business separately. They both benefit from one another as well.

It’s a Thing in Canada

A Fresh Toast article from May 2023 reveals that the marijuana convenience store model is already a thing in Canada. It is being led by a partnership between the company that owns the Circle K brand and a Toronto-based cannabis retailer known as Fire & Flower. The two operate several co-located stores with plans to continue expanding for the foreseeable future.

To make it work, Circle K’s parent company, Canada Couche-Tard, contributed a significant amount of funding to help Fire & Flower expand its operations. Circle K gets something for their investment by way of patrons visiting co-located stores to purchase their marijuana. They are likely to buy other products from the Circle K side of the store.

Idaho’s Jackson’s Food Stores has joined forces with Toronto’s CordovaCann Corp. to do much the same thing in the U.S. According to The Fresh Toast, they expect to open co-located stores in Washington, Oregon, and Arizona later in 2023.

For the Recreational Market

We should note that placing pot shops inside convenience stores is only for recreational markets. In states like Utah, where recreational marijuana has not been approved, only licensed pharmacies can sell medical cannabis products. Utah cannabis dispensaries are strictly regulated in every phase of their operations.

According to Pure Utah, one of the 15 licensed dispensaries in the state, there are no current plans to issue more licenses. So even if regulators could see their way clear to giving co-located stores the green light, there is not enough opportunity in Utah to make the investment worthwhile.

Things are different in Washington, Oregon, and most of the other states with legal recreational markets. The question in each of those states is whether regulations allow a co-location arrangement.

The Wave of the Future

The Fresh Toast seems to believe that marijuana and convenience stores make a perfect marriage. They insist convenient stores are the place most people already go to buy age-restricted products, including alcohol and tobacco. Adding marijuana to the list does not seem unreasonable when you think of it in those terms.

It could be that pot shops located in neighborhood convenience stores are the wave of the future. At this point, nothing about the marijuana market should surprise anyone. The people have spoken in more than two-thirds of the states. And they have said loud and clear that they want access to medical and recreational marijuana. The industry is simply responding to their demands.

Is marijuana coming to a convenience store near you in the near future? Probably, at least if your state allows recreational consumption. In states with medical-only or no consumption at all, convenience stores probably aren’t even on the radar yet. We will have to wait to see how things go in those states in the coming years.