There are no shortages of opinions or predictions when it comes to the cannabis industry. Thankfully, New Frontier Data, a leading cannabis analytics firm has just released a detailed report on the first four years of legal adult-use sales in Colorado.
Although voters legalized recreational cannabis when they approved Prop 64 in November of 2012, legal sales did not begin until January of 2014. Lawmakers spent the time in between approval and actual sales crafting and finalizing regulations.
The New Frontier report offers quite a bit to dissect, but we can start with covering some of the biggest takeaways. From 2014 to 2018, Colorado cannabis sales generated a total of $6 billion. Almost $1 billion in tax and business license fees were collected by state officials during this same time period. The report shows no signs that the cannabis industry is about to slow down in Colorado. Recreational sales grew by 300 percent between 2014 to 2018 and accounted for about two-thirds of all cannabis sold.
The increase in the recreational market could be impacting medicinal sales. During the same four year period which saw huge gains in recreational sales, medical sales dropped by 13 percent. It is possible some patients no longer felt the need to maintain their recommendations for medicinal cannabis and became recreational customers. Overall, medicinal cannabis sales totaled just under $2 billion, a little under one-third of overall sales. In 2014, medicinal sales actually outpaced recreational sales, perhaps due to the initial supply shortages of recreational cannabis. That was the last year medicinal sales exceeded recreational sales.
It looks like the Colorado cannabis industry is increasing more than just sales and revenue—it is helping the Colorado economy. New Frontier found that 38,790 jobs that either were directly involved with the cannabis industry or ancillary jobs have been created since 2014. The Colorado economy also benefited from canna tourism, with 3,388,000 travelers coming to the Centennial State just to experience legal cannabis.
Although it is possible Colorado could soon be reaching a saturation point when it comes to legal cannabis, new options in dispensing, delivery, social consumption, as well as continued product innovation, could keep the industry growing for its next four years.