COVID-19 impact on Cannabis
Is the Cannabis Industry Being Impacted by COVID-19?
COVID-19, also known as coronavirus, is having a massive impact across all industries. Cannabis is no exception to this. However, what remains to be seen is what the long-term effects will be. Right now, the cannabis industry is dealing with changes in how marijuana is sold, issues with supplies for vaping and accessories, a lack of tourism, and a lot more. As this is unprecedented, especially for the cannabis industry, it is hard to tell how long the impacts will last and whether this will end up being detrimental for dispensaries and other businesses. Or, will they be able to recover quickly once the economy starts opening back up?
Changes in How Cannabis is Sold
Coronavirus is spreading rapidly and easily spreads between people. For this reason, sweeping changes have been made for how dispensaries work and how cannabis is sold. This was perhaps one of the first changes to occur because of the pandemic. Many dispensaries closed temporarily for sanitation and then opened back up with social distancing techniques in place. In Illinois, many went to appointment-only sales and online ordering.
Other dispensaries across the US switched to online orders only, limited the number of customers in the store at one time, or enacted other measures designed to protect their customers while minimizing the reduction in sales due to the pandemic. While online ordering might be here to stay, many dispensaries do hope to be able to take care of customers in-store again as well, even if the way it is done needs to be changed for social distancing.
With all of these changes, it is not surprising that more people are now purchasing their own cannabis seeds and growing them at home. I49 Seed Bank USA is a great source of not only up to date growing information, but also a plethora of feminized, autoflower, and medical marijuana seeds. Here are a list of some top 5 selling strains that are easy to grow. A perfect way to develop a new skill if you are stuck at home under quarantine:
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Dispensaries Urge Careful Consumption
Along with changing how cannabis is sold, dispensaries are urging careful consumption to reduce the spread and keep their customers safe. Staying at home and consuming marijuana is encouraged, though it is not encouraged for people to have others over to consume cannabis. In this way, it’s becoming more of a solitary pastime. Marijuana has long been known as something to do with friends, in groups, or other social settings, despite legalization only occurring in recent years. With the pandemic, however, this is no longer possible. Even though more people are home and may be able to consume marijuana without worry, it’s not recommended they do so with friends.
Lack of Tourism Impacting Cannabis Sales
An almost surprising amount of cannabis sales comes from tourism. Those in states where marijuana is still illegal may purchase and consume marijuana when they visit places that have legalized recreational use. While the pandemic continues, though, vacations are canceled, and traveling is not recommended or, in some cases, allowed. As a result, many recreational cannabis stores are seeing a considerable decrease in sales. The tourists that generally make up a large part of their sales simply aren’t there right now.
Those companies that have focused on tourism for the majority of their customers are finding that they need to turn to local sales and change the way they market, the way they promote sales, and more to help bring in local customers. They may also need to add more delivery vehicles to allow for home deliveries as well as improve their website to allow for online sales. This has come at a high cost for these businesses, but those that are successful are likely to continue doing well through the pandemic.
Vapes and Other Accessories Not Being Produced
Vaping has come in the news a lot lately because of lung injuries and other medical concerns. Marijuana vapes have continued to sell, however, and are still a big part of the cannabis industry. With the pandemic, however, vapes are more challenging to purchase, and many consumers are looking toward other options for consumption.
Most of the vapes purchased in the US are made in China. China has wholly closed many parts of the country, shutting down manufacturing plants and keeping workers at home in an attempt to curb the spread of the virus. For cannabis users, this means vapes and similar accessories are more difficult to come across. For the most part, they aren’t being made right now. The accessories that are being made are in demand right now, with limited supplies throughout the US.
Unemployment Rates Increasing Significantly
As panic set in at the beginning of the pandemic, many businesses shut down completely to help keep employees and customers safe. Many others switched to work-from-home for the employees to keep them out of the office. This has helped to curb the spread, but it’s not over yet, and many businesses are unable to continue paying employees at home and not working. As a result, millions of people in the US have become unemployed.
When unemployment skyrockets, it has an impact on what people can purchase. Those who use marijuana for medical purposes will likely still be buying the same amount. Those who are unemployed and only consume marijuana recreationally, however, will probably end up spending less on marijuana than they would have if they were employed. Even with unemployment money and the stimulus check, many people are saving what they can and focusing on necessities instead of pastimes they enjoy. For some, this has inspired folks to buy their own weed seeds online and go ahead growing their own cannabis in a greenhouse or grow tent.
Purchases Spiked, People are Buying More, but Less Frequently
When stay-at-home orders were first announced, purchases spiked. Many people purchased more marijuana than they usually would out of fear that the dispensaries would be closed and they wouldn’t be able to buy more. This led to record amounts of sales in some areas. Since then, however, sales have remained the same or started to decrease.
Instead of purchasing marijuana frequently and having small amounts on hand, consumers are purchasing less often but buying more when they do shop. Even if the average number of sales is the same, when the transactions occur has changed. However, sales have been slowing some, even with consumers purchasing more at one time. As unemployment continues, some consumers are finding they simply don’t have the money they need to keep buying marijuana at the same rate they did previously.
Cannabis Dispensaries are Deemed Essential
With stay-at-home orders throughout the country, businesses across many industries have closed entirely or moved to online-only orders for the time being. The cannabis industry, however, has continued to be open and available for consumers. Changes are in place for the number of people that can be in a dispensary simultaneously or how orders are handled, but orders are still being placed.
Since cannabis is often used for medical purposes, it has been deemed an essential business. Those in charge in legal states have decided that marijuana is medically necessary for many people, including those with mental health issues or those who may suffer from mental health issues as a result of quarantines and loss of employment. As such, dispensaries can continue to be open even when non-essential stores are closed.
No Bailout for Cannabis Companies
Bailouts have been happening throughout the US to help businesses impacted by closures, high unemployment rates, and low consumer shopping. This is especially crucial for companies affected by the lack of tourism. However, cannabis companies aren’t included in this and are not going to receive a bailout as other companies would.
Marijuana is still illegal at the federal level. The coronavirus stimulus package – and others that may be created – don’t offer funding for businesses that are considered illegal. There are already issues with the cannabis industry having trouble with banking because of the illegality federally. Now, with no bailout, the cannabis industry is going to have to struggle to make it through the pandemic, when other businesses would receive help.
Events are Being Canceled
Cannabis-related events are being canceled around the world. The cancellations started before COVID-19 was officially declared a pandemic, and more are expected in the coming months. In fact, 4/20, the most significant day traditionally for marijuana sales and events, went by with little fanfare because of the social distancing restrictions around the world.
Some of the events that have been canceled include Spannabis, SXSW, the California Cannabis Industry Association Policy Conference, the Oklahoma Cannabis Expo, and the National Cannabis Unity Conference. Many more have been canceled or are expected to be canceled in the near future. While some of the events were just fun, many also included cannabis-related conferences, expert speakers, and chances for new entrepreneurs to network and start building their business. It is unsure when events will be allowed to start up again, as there are still restrictions on the number of people allowed in one place due to the continued social distancing orders.
Cannabis legalization has come a long way in recent years, but the coronavirus is threatening everything. While those who work in the cannabis industry have been deemed essential, reduced sales and other issues are causing concern for the cannabis industry. The full impact of COVID-19 on cannabis-related businesses, however, is yet to be seen. Those in the industry do have hope for the future, but they aren’t sure precisely what the post-COVID future will look like for the cannabis industry.