It’s not quite Coke vs. Pepsi or Starbucks vs. Dunkin’, but some competing cannabis dispensaries on the Newark Avenue Pedestrian Plaza in Downtown Jersey City don’t exactly see eye to eye.
The open air mall, located in the heart of Downtown, has become the ideal place for a number of entrepreneurs to sell legal cannabis to commuters, visitors and stoners alike. But some entrepreneurs on the plaza have taken to the courts to stop others from opening.
In an industry that’s relatively new to Jersey City and New Jersey as a whole, is competition in close proximity ultimately good for businesses? The answer for dispensary owners is yes, although others noted that it’s complicated.
“There’s always room for competition,” said Brian Markey, owner of Garden Greenz dispensary at 190 Newark Ave. “Businesses have rent, overhead, owners and partners, and they have to be able to survive. The question is: Are these businesses going to be able to make enough money where they can stay open?”
Markey opened his pawn shop-turned-dispensary last Halloween as one of the first cannabis businesses in the city and then filed a lawsuit that would have effectively prevent other competitors from opening, based on the city’s proximity rules.
Meanwhile, the city’s cannabis industry is flourishing. Currently nine dispensaries are open — three Downtown, two in the Heights, one in Journal Square, one on Communipaw Avenue, one in Greenville and one on the West Side — the most of any municipality in the Garden State.
Markey’s lawsuit, which was dismissed last week, charged that Jersey City failed to enforce a rule requiring dispensaries be at least 600 feet apart. It was aimed at two nearby competitors: Local Modiv, at 155 Newark Ave., and Cream Dispensary, at 284 First St.
“It’s not my intention to ruin other people’s businesses,” Markey said. “My intention was to have the city admit that they messed up.”
Jersey City spokeswoman Kimberly Wallace-Scalcione said in response to Garden Greenz’s lawsuit that “the narrative that the city is not enforcing the law is completely inaccurate.”
Markey is not the only cannabis entrepreneur that took to the courts. downtown FLWR, another dispensary on the plaza, filed a lawsuit against Local Modiv over its victory in a prior lawsuit against Jersey City for denying its application in 2022.
Chelsea Duffy, co-owner of Local Modiv, said that competition wouldn’t hurt her business and that there’s enough room multiple dispensaries on the plaza. “It showcases more camaraderie among business owners in the industry,” she said. “That’s really always been my goal: not to be the only one in town, but to be an option among others.”
The burgeoning industry has seen some areas in the city, primarily shopping districts, become hotbeds for dispensaries, and some are proposed to be in close proximity. One cannabis business expert said that whether competition will hurt or help depends on how prepared businesses are.
“If you can differentiate yourself in the crowd, then it doesn’t really matter, right?” said Scott Rudder, president of the NJ Cannabusiness Association. “But if you’re just there, putting products on shelves for sale and providing discounts, you’re not separating yourself from the pack, and that’s where it becomes much more of a complex answer.”
Rudder says that more competition will leader to lower prices and a better quality product for consumers. Chris Goldstein, a regional organizer at NORML, a marijuana reform group, said that the less “litigious” people in the industry are, the more it can focus on delivering “good quality products for a good price.”
“I don’t think that having five or 10 dispensaries in a row, if they’re the only legal dispensaries around, deeply affects the competition,” Goldstein said. “That’s because they’re stuck and they’re zoned together. I would like as a consumer to see them more spread out and ubiquitous.”
Duffy said that reduced prices will have to do with diversifying the amount of products available and that the industry is waiting for cannabis cultivators “to really catch up.”
While Markey said that competition is healthy, he argued that the problem is that dispensaries are selling products from the same manufacturers and that prices won’t be lowered. He compared it to having 10 pizzerias on the same block and that the cannabis scene will become “oversaturated.”
“There’s a fine line between oversaturation and competition,” he said. “We’re very successful in terms of numbers, but I don’t think there’s a need for two more on Newark Avenue, but that’s not for me to answer at this point.”
downtown FLWR’s lawsuit could be mediated between the parties involved, according to court documents, with FLWR saying that “we believe it is worth a half-day with a retired judge to try to resolve this matter.”
