“Well, of course it’s a success,” responds a colleague. “Look at all the shops and stores selling the stuff.”
They’re hard to miss. There seems to be one in every strip mall, no matter how humble. All along we’ve been told that most won’t survive. Instead, at some point there will be a major “shakeout” in the marketplace, and only the larger, better-funded “canna-businesses” will make it. They’ll then proceed to dominate the future.
Here’s something we wrote on that subject last year.
Nobody likes to see small businesses fail, but there was a sense of inevitability here. The hope was that small and minority owned businesses would be the winners. But from the start, many experts were predicting the opposite would occur.
Meanwhile, cannabis sales remain strong. More than a billion dollars, our State claims. That translates to plenty of State tax revenue, which we do need.
So I was surprised to stumble on this provocative headline in a local weekly.
“You Can’t Handle the Truth” — Ultra Health CEO Duke Rodriguez questions NM’s cannabis claims
Mr. Rodriguez, by the way, is a former New Mexico Secretary of Health turned cannabis entrepreneur. He expresses concern that a disproportionate share of cannabis sales are along the State’s eastern border. Translation: the money is coming mainly from Texans, who cross the line to buy pot in New Mexico.
I thought that was a selling point. It wouldn’t be our citizens dropping their hard-earned cash in order to get baked on pot. It’d be our rich neighbors from next door.
I recall that during the decades before Maryland legalized casino gambling, folks from DC and Baltimore would complain about having to travel all the way to West Virginia and Delaware to blow money at the tables. It was seen as a hardship.
That didn’t stop them, of course, but they did gripe about it.
According to Duke Rodriguez, it’s an omen of bad times to come. Why? Because people in New Mexico’s cities are simply not buying enough pot. He explains:
“…in April 2022, Albuquerque did $14.9 million in combined medical and recreational cannabis sales, Las Cruces did $3.7 million, and Santa Fe did $3.5 million. Sadly, nearly two years later…[in February] Albuquerque is flat at $15 million, Las Cruces is down to $3.2 million, and Santa Fe is down to $2.9 million.”
Wait, Santa Fe is a city of 89,000 people. How much pot can we reasonably expect our citizens to purchase in a single month? $2.9 million sounds like a lot to me.
I don’t blame the CEO of a cannabis company for worrying about revenue. That is the job description. However, as someone who spent his career in addiction treatment, I just can’t get too worked up over the threat of fewer people buying and using psychoactive drugs.
In my slice of the world, that’s generally considered a good thing.
