According to new estimates from The Cannabist, recreational and medical marijuana stores in Colorado sold over $136 million in products in September of 2017. Since actual sales numbers aren’t available in Colorado, The Cannabist gets their estimates by extrapolating sales data from tax revenue data.
During the first three-quarters of the year cannabis shops in Colorado have exceed $1.1 billion in sales, up 19% from the same period last year. Earlier this year, however, the annual rate of growth was at about 36%, leading some to speculate on whether a plateau in marijuana sales is coming in Colorado.
The most obvious short answer to that is: no one knows. A market is not just numbers and patterns, it is the millions of individual decisions that are made by people that affects that market; combined, these decisions will tell the tale of where the marijuana sales plateau in Colorado is.
One of the major components that go into these decisions is price. If the price of cannabis is lower than the black market price, it will bring more people into the legal market, increasing sales. But if prices are “too low,” even the increased number of people buying legal cannabis could result in an overall decline in the total sales in terms of dollars. If enough people feel the price is too high compared to the illegal market, many won’t make the switch, which could also result in a decline in total sales.
Another major component is available supply. Not only does the amount of supply heavily affect the price, the variety and availability of certain kinds of supply will affect whether someone buys from a legal shop or an illegal dealer. If a local shop doesn’t have a certain strain a medical patient is looking for, that patient may be able to find a friend or an illegal dealer who does. This transaction and all like it would not show up in the total for legal sales.
Other factors like customer service, available income devoted to buying cannabis and even bad weather can and will continue to affect total sales numbers. But in general, as long as cities and towns in the state allow retail and medical marijuana dispensaries to open for business, overall sales will likely continue to climb for the foreseeable future.
The illegal marijuana market is massive; the key, as it has always been, is moving as many consumers as possible over to the legal market.