Cannabis retailers in California have experienced an increase in customer traffic and are reporting record sales in the last few months, showing no signs of slowing down during the pandemic.
Considered an essential business in the state of California, marijuana retailers and services have been able to remain open while other businesses considered non-essential, including hair salons, retail stores and restaurants were ordered to shut down or limit their services.
Vanessa Alarcon, a store manager at a popular cannabis retailer in Downtown LA, said they’ve seen record sales in the last few months, since they opened in August of last year.
“We have seen our sales increase by almost 50% on the weekends and 70% on weekdays, compared to our numbers before the pandemic. Our delivery service demand has also increased by almost four times,” Alarcon said.
Her business has had to hire new employees to meet the new, higher demands.
In an attempt to keep their employees and customers safe as they continue to see high traffic, they have adopted social distancing measures.
All employees are required to wear face masks and gloves and customers are not allowed to enter in groups larger than two and have to stay 6 feet apart while waiting in line.
So why is there a sudden sharp incline of marijuana consumption?
With many people staying home during the pandemic, it comes as no surprise that some have been spending more time enjoying their favorite activities – a common one being getting high.
“I have noticed I make more trips to the clinic [dispensary] nowadays. I have a lot more free time to incorporate weed into my daily activities,” says Kristina Arrington, a professional who is now working from home after the pandemic.
Arrington prefers smoking marijuana over drinking alcohol because she believes it is a healthier lifestyle choice.
She isn’t the only one who has shifted from drinking alcohol to smoking more marijuana during the pandemic.
Ernie Garcia, a finance manager who was temporarily laid off, said, “My habits have changed in the sense where I don’t drink as much, however, I have been smoking a lot more. I’ve probably doubled my intake since this [pandemic] happened.”
One of the biggest cannabis sales periods in California also came in March, when many retailers witnessed panic-buying by consumers when the Coronavirus pandemic took hold.
Alarcon remembered seeing one of their highest selling weeks in the days following the initial lockdown.
As of May, California’s cannabis excise tax generated $68.3 million in revenue, reported in the First Quarter 2020 returns due by April 30, and the cultivation tax generated $16.4 million as reported by the California Department of Tax and Fee Administration.
Due to the COVID-19 pandemic, First Quarter 2020 is a unique reporting period since approximately half of the taxpayers had yet to file a return with the CDTFA.
Revisions to First Quarter 2020 data are expected in mid-August or later, after the second quarter return filings – which were due by July 31 – are processed.
These revisions will provide more accurate data and reveal exactly how much revenue has been generated by the cannabis industry during this pandemic.
