This story was republished with permission from Crain’s Cleveland Business.
Ohio recorded more than $11.5 million in non-medical marijuana sales in the first five days of free trade, between Aug. 6 – when recreational sales began – and Aug. 10, according to data from the Ohio Division of Cannabis Control.
Industry insiders say sales were particularly high on opening day and the following Saturday. Despite all the ups and downs, these total sales figures suggest an average of $2.3 million in sales per day for the first five days.
According to government figures, medical marijuana sales during the same period totaled about $8.3 million, or an average of about $1.66 million per day.
August 6 was a milestone for Ohioans, who approved recreational marijuana in a referendum last November. And despite the severe weather that hit parts of the state that afternoon, users came out in droves.
Andy Rayburn, CEO of Buckeye Relief and president of the trade group OHCANN, spent a lot of time during the first few days of the adult-use launch talking to customers in lines outside his Amplify dispensaries in Cleveland Heights, Bedford and Columbus. “The flow of people never stopped,” he said.
“Our pharmacies were very busy, and I believe the scene I’m describing was common across the state, with almost consistently long lines out the door on (the first) day,” Rayburn said.
Jason Erkes, a spokesman for Cresco Labs, a Chicago-based multi-state cannabis company that is vertically integrated in Ohio and operates five dispensaries in the state under the Sunnyside brand, said sales “exceeded our expectations.”
“Any way you look at it, Ohio had incredible first-week sales that were on par or better than other adult-use launches like Illinois,” he said. “Some of our Sunnyside stores had up to 1,250 customers a day in the first week and sales that were more than double what we were getting from patients before we made the switch.”
According to DCC data, the first five days of sales in Ohio resulted in a total of 138,466 transactions at the state’s 98 licensed dual-use dispensaries.
“Ohioans were clearly ready and excited for the historic end of cannabis prohibition in the Buckeye State,” said Trip McDermott, chief operating officer of Chicago-based Verano. “Since we began recreational sales, we have already seen two to three times the foot traffic and transactions at all five Zen Leaf dispensaries across the state compared to previous medical-only operations, and we expect to continue to see strong activity in our stores and through third-party wholesale sales of our products for the foreseeable future.”
Prices were increased, but that was to be expected for a new adult market.
DCC reports that a “day’s supply” of cannabis flower during that first five-day period — the equivalent of one-tenth of an ounce, or 2.8 grams — retailed for $26.59. Add in a 10% excise tax and a statewide average sales tax of 7.2%, and that item cost just over $31.
That price of $26.59 was about 20 percent higher than the average price for the same amount of buds a week earlier on the state’s medical-only market, and was exactly in line with expectations.
This price seems high compared to neighboring states like Michigan, where an ounce of flower typically retails for $70 before taxes and an ounce of shake can be had for just $25. Of course, Michigan is dealing with a saturated market, which drives prices down there.
“I think there are some customers who, despite the poor quality of the products available there and despite the inconvenience of spending hours in the car and really sacrificing an entire day, will continue to go to Michigan pharmacies if they can drive 10 minutes to an Amplify pharmacy or somewhere else,” Rayburn said.
“Unless you’re buying thousands of dollars worth of marijuana products all at once, the question is, is it worth it? I think some people will do that anyway,” he added. “But prices in Ohio will go down next year.”
