Cannabis Business Times
Last month’s announcement that Green Thumb Industries will partner with Circle K placed a spotlight on the small but mighty gas station-dispensary model.
When Jackson McLeod and his team were scouting possible locations for their cannabis dispensary in 2018, they stumbled on an unlikely storefront: a six-pump gas station squatting on a main commercial strip of Portland, Maine. It seemed like the perfect fit for Atlantic Farms.
The dispensary opened in December 2018, within the gas station itself, bringing cannabis to a highly trafficked business and exemplifying the expansion of Maine’s long-running medical market at that point in time.
“It was a major differentiator for us,” says McLeod, the CEO of the business. “From the beginning, we really wanted to normalize the cannabis shopping experience.”
This was still new to Maine. Previously, the state’s caregiver program allowed for growers to sell cannabis to five patients. In 2018, however, after much hemming and hawing in the statehouse, legislators removed the guardrails and allowed caregivers to open storefronts and to grow for an unlimited number of patients. After nearly 20 years, legal medical cannabis in Maine was now set to operate as an actual commercial market.
Prior to that expansion, the Atlantic Farms team had been looking for dispensary opportunities in nearby Massachusetts, hoping to work within that state’s new adult-use framework. But the news in Maine was too good to pass up; they were from Portland, after all, and what better place to set up shop than right at home?
Now, with storefronts opening throughout the state, the actual in-store atmosphere allowed for a more nuanced and personal approach to the medical cannabis transaction. This gave McLeod and the team much to think about.
The dispensary environment blends seamlessly with the gas station counter.
But even in those early days, already well into the ongoing development of cannabis markets elsewhere in the U.S., the prevailing models for the dispensary experience were the classic head shop or something closer to the sleek appearance of an Apple Store. The Atlantic Farms team was looking for something a bit more rooted in the caregiver culture.
“We saw the opportunity to use a gas station as a space that’s very open and welcoming to anybody who wants to come in,” McLeod says. “Most consumers were hesitant to step into any retail, so the gas station just represented a space that was open to everybody.”
The gas station is operated by separate owners, but to the consumer the storefront feels like a seamless experience: Gas up your car and snag a few grams of flower before you hit the road.
Those consumers make their way to Atlantic Farms for both reasons: fuel and cannabis. At the beginning, the gas station certainly drove the cannabis dispensary foot traffic. One could argue gas has the broadest possible consumer base, perfect for teeing up a secondary business on-site. Even at the gas station counter itself, Atlantic Farms distributes hemp-derived CBD products to further assist awareness of the dispensary.
Over time, this communal, errand-running spirit lent itself to the normalization factor that McLeod cited when he and his team set out to build this business.
“When we first opened, there’d be a line, and everybody—you could sense there was some anxiety around it, and no one was talking to each other,” McLeod says. “A month later, you could see the weight come off. Everybody felt really comfortable, and all of a sudden they were talking to the person next to them in line, like, ‘Have you tried this strain?’ It was amazing to watch that stigma melt away.”
The gas station is a big part that. So is the caregiver context.
With nearly 3,000 caregivers still growing cannabis and working with patients in Maine, the sense of connection is important for the businesses that have sprung out of this ecosystem. Caregivers who open a storefront may only grow up to 30 flowering plants, which means that businesses like Atlantic Farms must stay in close contact with caregivers around the state in order to secure the most diverse and sought-after genetics. (Under new 2022 guidance from the state, those caregivers may not sell prerolls or “liquid concentrates,” like vape cartridges, making these storefront outlets even more of a critical space for patients.)
“Our model for running the gas station dispensary was—and still is—to source product from tens if not hundreds of vendors over the last four years, so we always have a rotating deli-style menu featuring growers from around the state,” McLeod says. “We’ve gotten a lot of traction, because there’s so much quality work happening in Maine, as far as craft producers. We’ve been able to highlight all of those producers.”
Atlantic Farms also runs a regular “jar takeover,” wherein a local caregiver will earn the spotlight and show up to meet with patients in the store. It’s all an effort to level the playing field and maintain that sense of connection between grower and patient.
Last month, multistate operator Green Thumb Industries (GTI) announced plans to partner with Circle K and open small-scale dispensaries within select gas station locations in Florida. Headlines trumpeted the arrival of a new era in legal cannabis:
McLeod points out that it’s been done before—and, yes, it is a good model.
He also points to Native Roots, based in Colorado, which runs two separate co-located dispensary-and-gas-station businesses in Colorado Springs. Those two businesses opened in 2015, predating even Atlantic Farms’ foray.
For GTI, the planned development is part of a broader shift in the U.S. cannabis market—toward the very normalization that first guided Atlantic Farms four years ago.
“The new RISE Express model is a huge step forward in making it easier and more efficient for patients to purchase high-quality cannabis as part of their everyday routine when stopping by their local convenience store,” CEO Ben Kovler said in a public statement. If everything goes as intended, those RISE Express stores will open inside “approximately” 10 Circle K locations in Florida next year.
For business owners who may see those GTI headlines or who may stop into Atlantic Farms on a trip to Maine and then seek some sort of co-located arrangement in their own market, McLeod says it’s important to follow state and local regulations.
“We were fortunate to execute early, before there was a lot of regulatory framework in place,” McLeod says, pointing to a six-month moratorium on cannabis retail passed in Portland in August 2022. The key is to evolve and adapt as more local compliance measures emerge—wherever your business may be based. “If you’re starting from scratch, now, really understand the local ordinance, the requirements that need to be met there and at the state level–and just be prepared for them to change.”
Shortly after GTI’s Circle K announcement, the Florida Department of Health issued a curt rejoinder to the news: “Florida has never approved a Medical Marijuana Treatment Center to operate out of a gas station. … The opening of RISE Express stores remains subject to regulatory approval, and sales will be exclusively to Florida patients with a valid medical marijuana identification card.”
H/T: www.cannabisbusinesstimes.com
