Cannabis Sales Explode As Californians Become Homebound

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RICHMOND, Calif. — As Americans stock up on toilet paper and food to adjust to new restrictions on everyday life amid the coronavirus pandemic, they’ve identified weed as another essential good — particularly in California.

Cannabis dispensaries and delivery services across California and other states have reported a huge boost in sales over the past week as governors and local officials increasingly shut down non-essential services this month.

When Gov. Gavin Newsom issued a statewide order Thursday night directing nearly 40 million people to stay home, data from Weedmaps — the Yelp of the marijuana business — showed the highest number of orders in the platform’s 12-year history, blowing past average 4/20 sales by almost 50 percent. The company says sales in California alone on Thursday were up 204 percent compared to the previous Thursday.

“It’s been kind of wild,” said Bobby Vecchio, CEO of Los Angeles-based delivery service HERB. “It began slowly, 20, 30, 40 percent increases over the usual and then on Thursday we just got hit. I think that that’s really when folks started to panic.”

Even before Newsom’s directive, the volume of orders within states across the country had shot up nearly 230 percent Tuesday, compared with the same day the previous week. The largest chunks of that increase came from Los Angeles and the San Fernando Valley, where sales were up by combined 66 percent.

Along with the total number of orders rising dramatically, Weedmaps also reported seeing the average dollar-value of purchases made through its platform double on pickup orders and increase 37 percent on deliveries.

Those kinds of numbers have been recorded by cannabis operations from San Diego to the North Coast in what some businesses say is their strongest sales period since the opening week for legal marijuana in California January 2018.

Vecchio said that starting last Friday and continuing through the weekend, as Newsom declared a state of emergency and major sports league postponed their seasons, his company’s sales volume tripled.

HERB’s sales have tapered off just slightly from their weekend high, but Vecchio expects them to jump again after Newsom’s statewide order. The state has yet to issue direct guidance for cannabis shops, but profits for delivery services and curbside pickup are likely to climb even higher if customers are given fewer options to obtain their purchases.

Delivery, in particular, has already seen the fastest growth in sales, according to Roy Bingham, founder and CEO of BDS Analytics, which closely tracks the cannabis business. As of Thursday, the firm reported a roughly 30 percent increase in sales volume at the dispensaries and delivery services it collects data from in California.

At Eaze, the San Francisco-based delivery giant, the number of first-time deliveries and website sign-ups were both up by more than 100 percent on Wednesday, compared to an average Wednesday over the last year, according to spokesperson Elizabeth Ashford. Overall deliveries were up by 19 percent, while the volume of product per delivery increased by 25 percent.

While the numbers point to high demand for cannabis as many Californians worry about supply being cut off, they have raised concerns in the industry that consumers would quickly turn to the illicit market in a scenario where retailers are told to cease operations.

So far, the counties that have instituted shutdowns of “non-essential” businesses have erred on the side of leaving marijuana businesses untouched, other than a quickly reversed order in San Francisco on Tuesday.

“If we shut down legal cannabis businesses in this state, people are still going to buy cannabis,” Vecchio said, pointing to the illicit market. “We can’t really believe that that fixes the problem and that makes people safer.”