Curaleaf, citing slow rollout of cannabis sector, lays off 49 at Winslow production facility

Largest cannabis firm in U.S. says demand in N.J. is high, but limited number of dispensaries (just 35) means supply needed to fulfill market is lower than was anticipated

Curaleaf, the leading grower and seller of cannabis in New Jersey, announced Monday that it is laying off 49 employees at its Winslow production facility, saying the slower-than-expected rollout of the sector has impacted the amount of product that can be sold, despite a strong market for it.

Curaleaf CEO Matt Darin said the company still believes in the cannabis market in the state — and that this job action has nothing to do with a dispute with the state’s Cannabis Regulatory Commission earlier this spring.

The decision was simply about supply and demand, Darin told ROI-NJ. With so few dispensaries (there are just 35), there is only a limited need for product, he said.

“This is basically scaling back production because we have ample supply to meet the current needs,” Darin said. “We’ve been in communication with the union and regulators and have been really transparent throughout the process.”

The layoffs are the second for the company in the state this year. In March, Curaleaf announced it was closing its Bellmawr production facility for the same reason given today: not enough need. The company laid off 40 employees in that move.

Despite this, Darin said Curaleaf still has more than 150 employees at the Winslow site and approximately 400 in the state — many of whom work at the company’s three retail sites in Edgewater Park, Bordentown and Bellmawr.

Darin said all three retail dispensaries are doing well, with the Bellmawr dispensary being one of the highest grossing in the country for the company (which has 152 stores in 19 states). There just aren’t enough dispensaries in New Jersey to maintain the current product at the Winslow facility, Darin said.

“This is where the business is,” he said. “Ultimately, when more dispensaries open up, we’ll ramp back up and we’ll repopulate the grow rooms that we’re not going to populate for a few cycles here.”

When that will happen is not clear.

Darin said he is hopeful that many more dispensaries — as many as 20, he said — will be able to open by the end of the year.

Regulatory issues and other logistics involved in the process — both at the CRC and at the local level — has made the timeline for opening a dispensary a challenge since the state announced in April 2022 that it was allowing recreational sales.

In June, the CRC announced the state had reached nearly $180 million in combined medicinal and recreational sales. At the time, Executive Director Jeff Brown said approximately 300 conditional licenses have applied to convert to full permits to open.

The expectation of many is that both numbers would have been higher to this point.

“The reality is the market just hasn’t developed as many predicted — and that’s really a function of not having not enough legal distribution taking place throughout the state,” Darin said. “Only having 35 licensed adult-use dispensaries for a state of almost 10 million people is not sufficient by any stretch — and all prognosticators, from the state to every market participant, expected by July 2023 to have multiples more than that, but it just hasn’t occurred.”

When it does occur, Darin said Curaleaf will be ready.

The state-of-the-art Winslow facility is one of the company’s largest in the country — and was opened in June 2021 in anticipation of great need in the state, Darin said.

“The Winslow facility is one of our largest in the country and a mission-critical facility in New Jersey,” he said. “This is a facility that’s still going to be operating and managing a lot of production. We’re scaling back temporarily while the market further develops, but, hopefully, we’ll be able to bring back team members as more dispensaries get open as the year progresses.

“I think that’s the other message today.”

Curaleaf said employees who were laid off Monday will be offered a severance package that includes a continuation of salary and benefits based on years of service. Curaleaf also will provide them with an opportunity to interview for other jobs in the company.

The company, founded in 2010 in Wakefield, Massachusetts, has a strong history in New Jersey. It was one of the first medicinal marijuana companies in the state, opening in 2015.

Curaleaf has steadily grown to become a national and international leader in the industry. The company employs more than 5,200 people and has 2,100 active dispensary wholesale accounts. Curaleaf International is the largest vertically integrated cannabis company in Europe.

During the pandemic, Curaleaf moved its headquarters to New York City.