The cannabis industry has seen some scary turns amidst the coronavirus pandemic. In some cases, sales have fluctuated widely. People flooded in to stock up during the panic-buying phase, then hoarded their money as wages halted, then as stores started to re-open, they couldn’t serve nearly as wide a base as social distancing measures forced limitations in sales.
Now, come August, it’s starting to look like the overall impact of the pandemic has been a net positive for cannabis companies. A record-breaking positive, in fact.
That success isn’t marked just by sales, but also by hiring patterns and overall growth in companies’ interactions with retailers.
A white paper is an in-depth report that covers a complex issue and breaks down possible solutions. Wikileaf analyzed a white paper called The State of the Cannabis Industry: 2020, which outlines the tumultuous track marijuana has taken throughout the pandemic.
It covers the same ebbs and flows as Wikileaf has reported on extensively. This one follows the trends the product has taken over the year, and finds cannabis is on an upward path. It notes important dates that impacted trends in the marijuana industry, dating back to January 11th, when the first COVID-19 death was reported in China and the World Health Organization declared a global health emergency two-and-a-half weeks later.
The research paper says March marked the most uncertainty in the economy, as certain local governments started instituting stay-at-home orders before businesses were equipped to deal with the new standards changing daily. A spike in sales was followed by a steady decline, only for sales to spike again in April, stabilize, then rise steadily once again.
The cannabis industry continues to grow
The white paper finds that even despite the difficult road 2020 has taken those in the cannabis industry across, forward progress is still actively hurtling forward. For instance, the study finds post-recovery priorities to focus heavily on hiring for sales, marketing, and IT. Plus, revenue projections for the year overall are still on track to meet or even exceed what was expected before coronavirus struck, and in some cases even outpace growth in 2019.
The paper does note that the national averages are impacted by certain outliers. No areas seem to have taken a trend toward the black that impacts the average for the country, but some seem to have a happier pattern. Individual cities and states have reported numbers showing cannabis has beat the pandemic’s economic fallout.
California, the white paper says, stayed nearly exactly on track with patterns for national averages in sales. California was uniquely equipped in ways other dominions were not. The governor quickly labeled even recreational dispensaries as essential businesses. It also already had a robust system for delivering medical marijuana, and quickly signing people up for new medical licenses.
In Illinois, marijuana sales have grown significantly every month since shelter-in-place orders first started going into effect in March. Sales to instate residents have grown steadily throughout the pandemic, and sales to out-of-state residents have trended upward since April, with 34% spike between June and July.
July 2020 sales smashed previous records, reaching $61 million. That previous record, however, had just been set the month before, with sales totaling in a little under $48 million.
Colorado had similar fortune. Sales in May 2020 were up about 11% from the same time in 2019 and marked the most profitable May since recreational sales began in 2014. Sales were also 23% above the month before, which includes the 4/20 holiday and typically has great numbers.
Marijuana sales in Colorado have climbed every year since the state Department of Revenue began tracking them systematically in 2014.
The state of Oregon also broke records in 2020 for three months in a row, with one local news channel commenting that figure is one of few bright spots in the economy at the moment.
Oregon cannabis sales in March 2020 fell just short of $85 million, a jump of 37% from the year before.
In April 2020, the industry saw an even larger boost. Sales were up 45% from April of the previous year, marking the highest sales numbers on record in the area.
In May, the state broke the $100 million mark for the first time. That was a 60% increase over sales the previous year.
Cannabis dispensaries were considered essential businesses in Oregon and have remained open throughout the pandemic.
“The State of the Cannabis Industry: 2020” also touches on Alaska sales, which also saw a boost, though not one as dramatic as the three states listed above. As officials in Alaska closed down bars and restaurants, people flooded into dispensaries instead, and sales for that first week of shutdowns in March brought recreational cannabis 11% over its success in the previous year.
The white paper covering marijuana trends in 2020 found that the way people purchase cannabis, and in what quantities, has also changed. Many dispensaries switched to curbside pickup as its predominant model for sales, since delivery is not widely permissible and only a limited number of people can enter any given store where social distancing is enforced. As a result, people right now tend to purchase larger quantities of marijuana at once – either because they’re buying for friends as well when they pick up their product, or because they don’t want the hassle of pickup a specific pickup time. Meanwhile, dispensaries and distributors are struggling to keep up with consumers’ new purchasing patterns.
Through the pandemic, curbside pickup has increased in 79% of dispensaries surveyed in the white paper; 64% of businesses said they were delivering more, while 43% said they making greater use of touchless transactions and 43% also said they’d increased their digital marketing and e-commerce.
The white paper was put together by three companies: Vangst, a talent resource company that helps businesses in the cannabis industry link up with potential employees, tools, and experts; LeafLink, a wholesale marketplace that brings brands and retailers together to streamline operation and help facilitate product orders; and Flowhub, a retail management software for cannabis businesses across the United States.