The State of Nevada: An Insider’s Perspective, Part 3
Week 3 of Recreational Sales in the Nevada Marijuana Industry; this article is part 3 of a 4-part series.
By: Zed Schlott, The Dispensary, NV
First off, I’d like to say thanks to anyone here reading this. It’s been fun for me to get this information out into a public forum and I want to continue doing so.
Last weekend, distribution opened up through the only licensed company, Blackbird. All week stores throughout the entire state were waiting to hear when their license would arrive, and once they did, deliveries were immediately in full force. Reno was hit the hardest with depleted inventory, being as only four stores were open to the entire area.
The City of Sparks came online with recreational sales on Saturday, as well. I feel there was a significant advantage to those who got up and running in the first week, resulting in lesser openings for these locations that were a week late. Not only did customers purchase enough product so they wouldn’t need to wait in line at another grand opening, but also the power of converting first-time consumers into loyal customers from day one is such a significant advantage that it creates a large barrier of entry to those who did not open immediately. Yes, locals to the Sparks area will most certainly shop here, but from my understanding, most of the customers in Reno have no intentions of visiting Sparks, and would rather patronize a shop closer to their home. Dispensaries in those areas have had daily lines and ever-shrinking menus for the last week and a half. At one point, two of these stores had menus with less than six (6) strains available for purchase…
The price per pound has been hovering around $2500. Vendors who were selling B-grade flower beforehand for $1500-$1800 are selling for $2400-$2600, 15% tax included, whereas premium vendors are now asking for $2500-$3000 BEFORE the 15% tax. This brings the average cost per gram for premium buds from $4.41 to $6.33-$7.27 depending on if it was packaged and who the cultivator is. Keep in mind, this is not official data, just my speculation based on observations from being in the industry.
Many people have speculated that producers are sitting on excess supply in order to strain the market and keep prices high, but the problem is, an unexpectedly high number of dispensaries have come online with their own vertically-integrated production facilities. Some have proven they even have top-shelf products for a few bucks less, ridding themselves of third-party cultivators altogether.
Over the next month or so, we will see how much of an impact the branding of the cultivations actually has on sales. I feel that an aggressive amount of capital was spent on something that may not matter in the long run. Customers don’t seem to care what they purchase beyond some simple guidelines of what they’re looking for and seem to always go with staff recommendations. Just like many other industries, what your employees are buying themselves will be your best sellers, no matter who it is.
This post is part 3 of a 4-part series, The State of Nevada Marijuana: An Insider’s Perspective. Check back tomorrow for Part 4!
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