State regulations drive packaging woes

With the disparity between state and federal governments, regulatory edicts and interpretation of those directives have resulted in frustration and quick pivots for those who are operating in the industry – and it’s not vastly different in adult-use markets versus medical-only states – the struggle is one that is shared across the nation.  

Perhaps the biggest challenge facing the industry in terms of packaging is the child-resistant (CR) requirement for some packaging of cannabis products.  What is considered CR in California differs greatly from what qualifies as CR in Nevada. Case in point, in California, a chocolate bar must be child-resistant for multiple points of entry, while in Nevada, the same bar must only be child-resistant from one point of entry.  

California has been the poster child for changes in direction for regulations related to packaging and labeling, with frequent changes every few months since legalization began, leaving many operators sitting on empty packaging that has to be modified or scrapped.

“We’ve heard from many of our customers that they’d like to order as little as possible, like a couple hundred units every two weeks, because of constant language changes in the packaging. So, if they buy four months of inventory and, all of a sudden, the state of Washington changes the law, they have to change it or throw it out.” This from Ed Kilduff, the founder of New York-based Pollen Gear which launched in November 2016 and offers about 14 products.

Among the obstacles facing operators is the interpretation and sourcing for packaging.  Packaging woes have plagued the smallest players to the largest brands. Packaging companies are widely distributed throughout the US and around the globe, but the differences in understanding of state-by-state cannabis-related nuances haven’t quite made it to all packagers.  This has resulted in the concept of primary packaging and secondary packaging. In this case, using the chocolate bar as an example, one packager provides the cardboard sleeve, without any child-resistant considerations, while a manufacturing facility will be responsible for the cannabis-specific CR requirements on the interior foil wrap and imprints on the product.  

Interestingly enough, at the time of publication, Colorado has the longest list of requirements, spanning almost 10 pages in the abstract, while Delaware has the shortest.  Missouri has published some guidance in the area of requirements for packaging, but several details are still not fully baked and abundantly clear to operators in our state. 

Child-resistant packaging is only a tiny portion of the puzzle. While the outside of the package is critical for regulation and safety, the ability of the packaging to ensure product quality is also always at the forefront of those planning for their products’ temporary homes.  Edibles have a shelf life and with high-quality chocolatiers producing cannabis-infused treats, the packaging must stand up to elements that prevent preservation of the products. Flower packaging must be “stink-proof” and still maintain freshness while remaining safe from moisture and being attractive to consumers.  

Labeling also requires very detailed restrictions.  Not only labeling of the package, which must include THC content, but also requisite symbols, active ingredient declarations, and critical tracking information that indicates facility and lot numbers.  While most manufacturers agree with the importance of track and trace from seed to sale for safety, the more strict labeling requirements are different depending on product type – i.e. flower vs. edible, etc.  

Some of the regulatory examples in markets today:

Standing Out From the Crowd

   

Once all of these considerations are taken into account, the product manufacturers have to determine how they can include the fundamentals of marketing and branding to set them apart in the marketplace.  With limited space for creativity and the parameters of package type driving their decision making, it puts a definite effort on the marketing minds of cannabis.

In Massachusetts, branding for cannabis businesses/products/services can’t contain the image of a cannabis leaf.  Not a half leaf, not a stylized leaf – no leaf. In virtually every state with some form of legal cannabis market, there are strict requirements that edibles must not be packaged, labeled, or marketed in any way that might be appealing to children. Certain motifs are forbidden, no ponies, no cartoon characters, avoid the use of bright colors, etc.  

Several packaging companies are seeing the trend in needing to offer custom solutions and have started to include design as a large part of their services offered. A cannabis company’s brand can be far more enticing in the form of merchandise offerings and signage than on typical product packaging, which makes it somewhat unique when compared to other consumer packaged goods.  

Some design groups are pushing the envelope of creativity and finding the use of high-end packaging, while more expensive than traditional, non-custom solutions, can be critical in elevating their branding and logos. Some personal favorites in the market who must be commended for their commitment to their creativity include StudioOnFire and Lowell Farms.  That customization comes at a price, but some smaller, artisanal brands are willing to take the gamble that the specialized and high-end branding will be well worth differentiation in setting them apart from their competitors.  

Balancing Safety and Sustainability

Safety is a must in any industry, especially in cannabis, where the threat of products in the hands of the wrong consumers (children, pets, etc.) is paramount, but from a consumer standpoint, it’s also something consumers crave, especially in light of the recent vaping scares from not-so-legit producers chasing the vape market.  

However, consumers also want sustainability to be something that the brands they choose are cognizant of.  Plastics, which formerly were deemed a resource that we could benefit from and constantly recycle, have become the stepchild of materials to use – and with good reason.  As many environmental awareness groups will tout, recycling isn’t going to solve the problem. They urge consumers to make informed decisions about purchasing products comprised of other types of materials and to be cognizant of things like reclaimed plastic and post-consumer content.  

More and more often, packagers are recognizing that consumers and brands are placing a higher value on environmental sustainability and are actively seeking ways to meet those needs.  Sana packaging is one such packaging partner that is betting on their ethos to be something that manufacturers will be drawn to.  They have an entire line of products that are 100% plant-based hemp plastic, 100% reclaimed ocean plastic, and other sustainable materials.  Sana’s goal is to “change the narrative.”  

As cannabis continues to become legally accepted in more states, we anticipate that packaging solutions that are conscious of the special needs of the cannabis industry, but until then, most operators will have to maintain relationships with a variety of packaging partners.  Packaging partners who offer low minimums, are produced in the US, and who understand the cannabis industry needs are the ones that will likely have the most success with state-regulated marijuana businesses.