North Carolina Drafts State Run Model
The Market and Regulatory Subcommittee of the North Carolina Advisory Council on Cannabis discussed draft recommendations on September 18th that would separate the supply chain into three tiers: privately licensed cultivation/manufacturing, a wholesale-distribution layer, and a retail system potentially controlled by the state. The document remains a draft for discussion, not an adopted policy.
Under the proposal, private operators could receive standard cultivation licenses or a smaller Craft Farm license intended for North Carolina farmers and small businesses. Manufacturing would also remain private. Wholesale distribution is less settled: the council is considering private distributors, a central state warehouse or some combination of the two.
Retail is where it gets interesting.
One option would create centralized state-operated stores. Another would resemble North Carolina’s existing alcohol system, with a state commission overseeing local boards and locally operated stores. The draft also discusses statewide product approval, limits on vertical integration and controlling the number and placement of retail locations.
Gov. Josh Stein created the advisory council in June 2025 after arguing that North Carolina already had widespread access to intoxicating hemp products without a coherent regulatory system. The council’s mandate isn’t simply legalization; it includes youth protection, public health, agriculture, expungement and development of a regulated adult market.
That background matters because North Carolina already has an unusual reference point: its ABC system. Spirits move through a state-controlled warehouse and local ABC boards rather than an ordinary private retail model. Last year those stores returned more than $710 million to state and local communities.
The council is essentially asking whether that infrastructure philosophy can be applied to THC.
There is another wrinkle. North Carolina doesn’t have a statewide adult-use market, but the Eastern Band of Cherokee Indians already operates an adult-use market on the Qualla Boundary. Meanwhile, an enormous hemp-derived THC market developed throughout the rest of the state.
This would be almost the inverse of the traditional vertically integrated model.
A private company could potentially grow it, manufacture it and sell it wholesale—but the government or a local government-controlled entity would own the relationship with the consumer.
That changes where the most valuable part of the supply chain sits.
It would also give North Carolina something most states don’t have: direct visibility into retail pricing, purchasing, product assortment and consumer sales rather than receiving that information secondhand through licensees and track-and-trace.
For operators looking at North Carolina as a future market, I wouldn’t be modeling dispensary locations yet. I’d be watching cultivation, manufacturing, distribution and especially state procurement.
