Business
7/10: The ‘other’ marijuana holiday boosting retail sales
Step aside, 4/20. There’s another unofficial marijuana-related holiday that retailers can take advantage of.
7/10, or “Dab Day,” is dedicated to cannabis users who prefer concentrates such as live resin, shatter or hash rosin, to name a few.
The name for the unofficial holiday – which falls on a Sunday this year – comes from the word “OIL” turned upside down, forming the numbers 7/10.
According to Seattle-based business intelligence platform Headset, concentrate sales increased by 67.4% on July 10, 2021, while rosin sales increased by 213% versus the preceding four Saturdays.
“7/10 tends to be the third-biggest sales period of the year, particularly as awareness around the day and interest in the concentrates category grows,” said Steven Jung, chief operating officer of San Francisco-based vape pod maker Pax.
“This is especially true in more established markets like California.”
4/20 and Cyber Week, tied to the Thanksgiving holiday, are the respective first- and second-biggest sales periods of the year, according to Jung.
Many retailers across the cannabis sector are running promotions for 7/10, including C3 Industries, an Ann Arbor, Michigan-based multistate, vertically integrated cannabis company.
“It’s a holiday that I think every cannabis retailer needs to take advantage of,” said Jason Berkenstock, vice president of retail for C3 Industries.
“The folks that we look at as competition are absolutely participating.”
While not nearly as many cannabis users celebrate 7/10 as they do 4/20, it still offers a good opportunity for retailers to run promotions, provide consumer education and sell more concentrates.
“It’s not as aggressive as the spike we see on 4/20, but we definitely see a nice uptick, a nice increase in sales on 7/10,” Berkenstock said.
By the numbers
According to Brightfield Group, a Chicago-based emerging-markets research company, about 25% of all cannabis consumers have used concentrates within six months of the survey date, which varied as the report covered a compilation of data going back to the first quarter of 2020.
That number has stayed relatively consistent from before the COVID-19 pandemic until now.
“Which is quite interesting as we’ve seen other things increase, like vapes and gummies,” said Maddie Scanlon, cannabis insight analyst for Brightfield.
“Another thing to consider here is that cannabis users as a whole have been increasing.”
In other words, concentrate users tend to consistently make up about a quarter of a cannabis retailer’s consumer base, even as the market expands.
While only 7% of cannabis users told Brightfield that celebrating 7/10 was important to them, compared with the 20% that said the same for 4/20, it can still make for a sizable jump in sales volume.
Headset also reported that concentrates take up 8.3% of the U.S. cannabis market share.
Gen Z and millennial males tend to be the biggest concentrate consumers, at 14.4% and 11.6% of the total wallet share, respectively.
It is also important to note, according to Headset, that U.S. consumers vastly prefer live resin to other types of concentrates at 34% of users compared with:
- Rosin, 12%.
- Shatter, 7%.
- Hash, 2%.
Promotional strategies
Besides being an opportunity to sell more products through discounts and promotions, 7/10 can be an opportunity to create new concentrate users by educating consumers who are coming in to buy flower or edibles.
“We take the opportunity to educate customers around the holiday, and if they’ve never dabbed before, educate them on where would be the best place to start, what concentrate form would make the most sense for them,” Berkenstock said.
While concentrates traditionally appeal to more seasoned cannabis users, new extraction technology and improved processing methods have evolved to the point where a user does not need the traditional torch-and-nail dab rig setup to use concentrates.
Those consumers can opt to use products such as vape pens and distillate cartridges, which can be much easier to use.
“For a lot of customers, they may be uncomfortable with it, because they’re not familiar with the dab rigs, all the tools needed to enjoy a concentrate,” Berkenstock said.
That was one reason C3 decided to make its own in-house dab cartridges ahead of 7/10, something retailers who are vertically integrated with cultivation arms can take advantage of, he added.
Additionally, consumers can be introduced to concentrates through products such as infused pre-rolls or rosin gummies.
7/10 “is an opportunity day to get someone to try concentrates through our lens,” Brightfield’s Scanlon said.
It should also be noted that as perishable products, concentrates do go bad and lose taste, especially if they are improperly stored.
So 7/10 can be a good opportunity for retailers to offload older products before their expiration dates.
“Someone is being left behind if they’re not participating in 7/10,” Berkenstock said.
Source: https://mjbizdaily.com/7-10-marijuana-concentrates-holiday-boosting-retail-sales/
New Mexico regulators fined a cannabis operator nearly $300,000 and revoked its license after the company allegedly created fake reports in the state’s traceability software.
The New Mexico Cannabis Control Division (CCD) accused marijuana manufacturer and retailer Golden Roots of 11 violations, according to Albuquerque Business First.
Golden Roots operates the The Cannabis Revolution Dispensary.
The majority of the violations are related to the Albuquerque company’s improper use of BioTrack, which has been New Mexico’s track-and-trace vendor since 2015.
The CCD alleges Golden Roots reported marijuana production only two months after it had received its vertically integrated license, according to Albuquerque Business First.
Because cannabis takes longer than two months to be cultivated, the CCD was suspicious of the report.
After inspecting the company’s premises, the CCD alleged Golden Roots reported cultivation, transportation and sales in BioTrack but wasn’t able to provide officers who inspected the site evidence that the operator was cultivating cannabis.
In April, the CCD revoked Golden Roots’ license and issued a $10,000 fine, according to the news outlet.
The company requested a hearing, which the regulator scheduled for Sept. 1.
At the hearing, the CCD testified that the company’s dried-cannabis weights in BioTrack were suspicious because they didn’t seem to accurately reflect how much weight marijuana loses as it dries.
Company employees also poorly accounted for why they were making adjustments in the system of up to 24 pounds of cannabis, making comments such as “bad” or “mistake” in the software, Albuquerque Business First reported.
Golden Roots was fined $298,972.05 – the amount regulators allege the company made selling products that weren’t properly accounted for in BioTrack.
The CCD has been cracking down on cannabis operators accused of selling products procured from out-of-state or not grown legally:
- Regulators alleged in August that Albuquerque dispensary Sawmill Sweet Leaf sold out-of-state products and didn’t have a license for extraction.
- Paradise Exotics Distro lost its license in July after regulators alleged the company sold products made in California.
Golden Roots was the first alleged rulebreaker in New Mexico to be asked to pay a large fine.
Source: https://mjbizdaily.com/new-mexico-cannabis-operator-fined-loses-license-for-alleged-biotrack-fraud/
Four marijuana companies, including a multistate operator, have filed a lawsuit against U.S. Attorney General Merrick Garland in which they allege the federal MJ prohibition under the Controlled Substances Act is no longer constitutional.
According to the complaint, filed Thursday in U.S. District Court in Massachusetts, retailer Canna Provisions, Treevit delivery service CEO Gyasi Sellers, cultivator Wiseacre Farm and MSO Verano Holdings Corp. are all harmed by “the federal government’s unconstitutional ban on cultivating, manufacturing, distributing, or possessing intrastate marijuana.”
Verano is headquartered in Chicago but has operations in Massachusetts; the other three operators are based in Massachusetts.
The lawsuit seeks a ruling that the “Controlled Substances Act is unconstitutional as applied to the intrastate cultivation, manufacture, possession, and distribution of marijuana pursuant to state law.”
The companies want the case to go before the U.S. Supreme Court.
They hired prominent law firm Boies Schiller Flexner to represent them.
The New York-based firm’s principal is David Boies, whose former clients include Microsoft, former presidential candidate Al Gore and Elizabeth Holmes’ disgraced startup Theranos.
Similar challenges to the federal Controlled Substances Act (CSA) have failed.
One such challenge led to a landmark Supreme Court decision in 2005.
In Gonzalez vs. Raich, the highest court in the United States ruled in a 6-3 decision that the commerce clause of the U.S. Constitution gave Congress the power to outlaw marijuana federally, even though state laws allow the cultivation and sale of cannabis.
In the 18 years since that ruling, 23 states and the District of Columbia have legalized adult-use marijuana and the federal government has allowed a multibillion-dollar cannabis industry to thrive.
Since both Congress and the U.S. Department of Justice, currently headed by Garland, have declined to intervene in state-licensed marijuana markets, the key facts that led to the Supreme Court’s 2005 ruling “no longer apply,” Boies said in a statement Thursday.
“The Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce,” Boies said.
“Moreover, the facts on which those precedents are based are no longer true.”
Verano President Darren Weiss said in a statement the company is “prepared to bring this case all the way to the Supreme Court in order to align federal law with how Congress has acted for years.”
While the Biden administration’s push to reschedule marijuana would help solve marijuana operators’ federal tax woes, neither rescheduling nor modest Congressional reforms such as the SAFER Banking Act “solve the fundamental issue,” Weiss added.
“The application of the CSA to lawful state-run cannabis business is an unconstitutional overreach on state sovereignty that has led to decades of harm, failed businesses, lost jobs, and unsafe working conditions.”
Alabama regulators are targeting Dec. 1 to award the first batch of medical cannabis business licenses after the agency’s first two attempts were scrapped because of scoring errors and litigation.
The first licenses will be awarded to individual cultivators, delivery providers, processors, dispensaries and state testing labs, according to the Alabama Medical Cannabis Commission (AMCC).
Then, on Dec. 12, the AMCC will award licenses for vertically integrated operations, a designation set primarily for multistate operators.
Licenses are expected to be handed out 28 days after they have been awarded, so MMJ production could begin in early January, according to the Alabama Daily News.
That means MMJ products could be available for patients around early March, an AMCC spokesperson told the media outlet.
Regulators initially awarded 21 business licenses in June, only to void them after applicants alleged inconsistencies with how the applications were scored.
Then, in August, the state awarded 24 different licenses – 19 went to June recipients – only to reverse themselves again and scratch those licenses after spurned applicants filed lawsuits.
A state judge dismissed a lawsuit filed by Chicago-based MSO Verano Holdings Corp., but another lawsuit is pending.
Source: https://mjbizdaily.com/alabama-plans-to-award-medical-cannabis-licenses-dec-1/
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