Morning Brew - ☕ Nipped in the bud

NY’s licensed cannabis retailers compete with unlicensed stores.
April 06, 2023

Retail Brew

EasyPost

Happy Thursday. Today, we’re going to bridge a generational gap and inform you that Gen Z’s favorite snacks are Goldfish and Cheez-It crackers. This is more evidence that legends never die, but given what we do, we have to ask: Who’s next to take the throne?

In today’s edition:

—Andrew Adam Newman, Maeve Allsup

CANNABIS

Negative stash flow

Three women inside a cannabis store. Kena Betancur/Getty Images

New laws allow recreational cannabis sales in more than 20 states, but it remains illegal under federal law, making starting a retail cannabis business complicated. This is Part 3 of a series, Spliff & Mortar.

Unlicensed cannabis stores in New York are growing like—what else?—a weed.

Since the law legalizing recreational marijuana passed in the state in 2021, only four licensed cannabis retailers have opened in New York, compared to more than 1,400 unlicensed stores.

And while some of those stores may appear illicit, others are major and impressive build-outs.

“Some of these stores are awesome,” Joanne Wilson, the angel investor and founder of Gotham, a licensed retail dispensary scheduled to open on the 420 holiday (April 20), told us. “They’re branded, they’re on point, they’re entrepreneurial. It sort of speaks to that entrepreneurial spirit that lives inside New York City.”

But while Wilson may have a grudging respect for some of those stores, she resents that they’re not bound by the many rules licensed retailers must follow, or tax rates that Politico estimated are as high as 70%. And she said that fines and other measures that have been taken against unlicensed stores have been insufficient.

“They should be fining them half a million dollars,” Wilson said.

But as city and state officials weigh more aggressive measures to close the stores, they want to avoid war-on-drugs tactics that may seem antithetical to cannabis legalization. Still, while the proliferation of unlicensed weed stores may seem as intractable as the city’s rats, they say a solution is taking shape. That solution can’t come soon enough for licensed stores, which expected to benefit from the novelty of selling cannabis only to open their doors in neighborhoods crowded with unlicensed stores.

Keep reading here.—AAN

        

TOGETHER WITH EASYPOST

Package (and performance) delivered

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Their white paper details 9 steps for boosting shipping performance so you can meet customers where they are, delivering their goods and promoting the good vibes that keep them coming back for more.

Grab your free copy to start.

TECH

That’s a wrap

An avatar walks through the Adidas store at Metaverse Fashion Week Metaverse Fashion Week

Metaverse Fashion Week (MVFW) 2023 wrapped up on Friday, after four jam-packed days featuring fashion shows, speaker panels, and opportunities to purchase out-of-this-world digital fashion.

The biggest excitement this year revolved around the added element of cross-platform interoperability: MVFW 2023 took place not only in Decentraland, but in a handful of other metaverses as well.

Brands approached the event theme of “Future Heritage” from different angles, including purchases for real-life wear, design competitions, and dance parties.

Now, enthusiasm for the metaverse has taken a hit in recent months: Disney announced plans to cut its metaverse department amid layoffs last week, Meta itself is walking back Mark Zuckerberg’s big promises of 2021, and public interest in the potential of the metaverse has steadily declined.

That’s a challenging landscape for the second rendition of MVFW to take place in, and the event wasn’t immune from lagging excitement—attendance was reportedly down from more than 100,000 attendees in 2022 to just 50,000 this year, and there was slightly smaller brand participation.

But the hype cycle downturn didn’t stop major names in streetwear and luxury fashion from attending, and attendees were treated to a virtual Adidas fashion show, a giant floating Tabby purse from Coach, and wearables inspired by Cristóbal Balenciaga.

So, for those of you that couldn’t make it, here’s a breakdown of what MVFW’s biggest players brought to the virtual runway this year:

Adidas: Back in December, Adidas gave holders of its “Into the Metaverse” NFTs access to the brand’s first collection of digital wearables. Last week, Adidas gave wearables holders a 3D twin that avatars could wear in Decentraland (previously they were only usable as profile pictures). The brand also hosted a gravity-defying runway show featuring those same wearables, which ranged from puffy jacket-adjacent to flaming angel wings.

Keep reading here.—MA

        

FOOD & BEV

Cumin attractions

An old McCormick container of ground cinnamon beside a new one. McCormick

For a company in the flavor business, it’s taken McCormick a long time to spice up its own packaging, but the brand is finally introducing the first redesign of its products in almost 40 years.

It all starts at the top—and with the top. The familiar red lid isn’t screwing around anymore, because now it’s what the brand calls a SnapTight lid. The lid closes with an audible snap, signaling that the garlic powder will stay potent enough to ruin dates long into the future.

Also notably different is the shape; the bottles introduced in the shoulder pad era had necks and shoulders, and today’s redesign is a streamlined cylinder. As for the label, it’s changed from what Dieline, the package redesign website, called a “sash” to a more modern-looking circle.

Because once you’ve taken a spice from the rack, your view of it is often aerial, the tops have the names printed clearly on them as well, helping to prevent such mishaps as sprinkling cumin instead of the intended cinnamon on French toast.

“These changes deliver a new standard when it comes to our passion and continued pursuit of flavor,” Nikki French, group vice president of marketing, NA Consumer at McCormick, said in a press release.

New packaging for standbys including cinnamon, garlic powder, and paprika is appearing on shelves, and the brand notes its entire red cap spice line will roll out in redesigned packaging over the next year.—AAN

        

SWAPPING SKUS

Today’s top retail reads.

The good ole days: Like in many places in the United States, shopping centers are struggling in Santa Rosa, California. Three malls in particular, which were once operated by real estate mogul Hugh Codding, are vying for survival, which may involve retrofitting them to their 1950s roots. (Retail Dive)

Box it up: Some of the biggest retailers, including Amazon and Walmart, are taking on cardboard waste by using machines that create custom packaging for online orders. Amazon claims made-to-fit boxes have reduced the average weight of packaging used per shipment 38% since 2015. (the Wall Street Journal)

Break time: Americans are emulating Europeans and working less than they did before the pandemic. While the average US workweek has dropped more than half an hour in the past three years, it’s also resulted in a labor shortfall equating to 2.4 million employees. (Bloomberg)

Lead easier: Put in charge but offered only a “good luck” and no guidance? Our New Manager Bootcamp will give you the lowdown on leading and prepare you for your new role. Sign up now.

WHAT ELSE IS BREWING

  • Amazon plans to reduce employee stock awards in 2025, according to an internal memo.
  • FedEx will consolidate its delivery units into one company.
  • Chipotle has sued Sweetgreen over an alleged burrito-bowl trademark infringement.
  • Bed Bath & Beyond has introduced a $120 million vendor consignment program with ReStore Capital to get merchandise back on shelves.
  • Cub Food workers will go on strike starting Friday.
  • Poshmark has unveiled a livestream shopping tool for its sellers.

NUMBERS GAME

The numbers you need to know.

It turns out the rising cost of eggs will affect Easter Sunday. It’s unclear if the potato-painting phenomenon is a genuine response to increased prices, but here we are.

About 72% of shoppers say higher food prices will affect their Easter plans, according to a FinanceBuzz survey of 1,000 people. Last year, about 51% of people planned in-person celebrations, compared to 43% in 2021.

  • Americans spent $6.58 billion on Easter food in 2022 and $2.6 billion worth of Easter candy is sold every year in the United States, making it the second-biggest candy-centric holiday behind Halloween.
  • Popular Easter staples are more expensive this year: Ham cost 52.9% more in 2022 than in 2021 and generally, meat was up 13.6% from 2021 to 2022. Lamb prices increased 18.5%.
  • In 2019, older millennials—those aged 35 to 44—spent $185.37 on Easter celebrations, after the 25-to-34 age range, who paid $189.25 on average. The 18- to 24-year-olds spent $146.03 in 2019, and those aged 45–54 paid $148.37. The ones who spent the least? People aged 65+, averaging $108.96 per person.

Other ways people will shake up their Easter plans include using more coupons (24%), limiting the amount of treats put into baskets (22%), and substituting real eggs for fake or plastic ones (20%).

  • 28% of respondents said inflation will have no impact on their Easter plans.

“Take advantage of any deals you find on candy, toys, or food that can help you save money,” the report reads. “Consider visiting more than one store to find what you need and start with the least expensive stores, like a dollar or discount store, first.”

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Written by Andrew Adam Newman and Maeve Allsup

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