California Marijuana Retailers See Significant Sales Growth

By the end of 2018, California marijuana retailers had seen a significant spike in sales during the third quarter of the year. The projections for the first half of 2018 were expected to be a bit higher, since tax revenue early on was underperforming. For context, cannabis sales in Q1 generated $34 million, with Q2 pulling in slightly more at $42 million.

California Dispensaries Grow

Fortunately, California marijuana retailers brought in third-quarter tax revenue of around $52 million, which signaled to many in the industry that the market was beginning to thrive. Although there were a fair number of hurdles and road bumps during the transition to recreational sales, a more stabilized market was clearly in sight.

One of the main factors behind the boost in cannabis sales was simply that there were more licensed California marijuana retailers. Indeed, regulators increased the number of marijuana retail licenses as the annual licensing process ramped up.

Slow Start for Adult-Use

Many industry professionals speculated that local bans on marijuana dispensaries, in addition to black-market sales, contributed to the underwhelming tax revenue in the first part of the year. However, once regulators finished drafting permanent cannabis regulations and made them official, the market was expected to settle in and grow steadily.

California’s medical marijuana market, by contrast, was already well established, earning over $3 billion in sales the prior year alone. At the time, it was roughly twice the size of both Colorado’s medical and recreational marketplace, though the adult-use market was poised to overtake it.

Sustainable Cannabis Sales

The State of California was certainly not the only party benefiting from increased sales. For instance, public companies like KushCo Holdings and MedMen Enterprises saw notable gains in the latter part of 2018. The potential for California marijuana retailers was evident, and once the supply chain hit its stride, growth was expected to continue barring any federal interference.

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