Chart: Tourism drives hot start to recreational marijuana sales in Nevada, but where’s the ceiling?

Nevada retailers sold nearly $200 million worth of recreational cannabis since adult-use sales began six months ago, surpassing the total revenue generated by Colorado and Washington state in the early months of their recreational markets.

Nevada’s higher sales totals relative to other adult-use markets are driven by several factors:

  • Nevada’s early start program – which allowed licensed dispensaries to sell recreational marijuana while final rules for the adult-use program were ironed out – proved extremely successful. Despite initial hurdles regarding cannabis distribution licenses, the state was generally well prepared to handle the influx of new recreational customers.
  • Over 40 million visitors travel to Las Vegas each year, many of whom visit the city primarily for vacation or leisure purposes.
  • Today’s cannabis industry is very different than it was in 2014, when Colorado and Washington state launched adult-use sales. Branding and retailing practices have advanced significantly, and stores now offer a larger assortment of products that appeal to both new and experienced consumers – such as low-dose edibles and high-potency concentrates – that weren’t widely available in rec markets just a few years ago.

Nevada’s adult-use program has certainly gotten off to a hot start, but rec sales in Colorado and Washington state have grown by leaps and bounds in the years since launch.

Currently, average monthly sales in Nevada are just over $32 million, while Colorado and Washington state’s average monthly sales over the latest six months of available data are $96.7 million and $79.7 million, respectively.

Whether rec sales in Nevada will grow as dramatically remains to be seen and will depend on how certain aspects of Nevada’s market develop.

A few things to consider:

  • The number of retail stores allowed in Nevada will be based on a county’s population, with initial estimates suggesting this will be around 130 statewide – fewer stores per capita than any other recreational market. Washington state and Colorado have each issued over 500 adult-use retail licenses.
  • Rec sales in Nevada have yet to rise in two consecutive months. This suggests the market is fueled by tourist spending, as sales in Colorado and Washington state – two markets where in-state residents form the bedrock of the adult-use customer base – continued to rise for several months before experiencing any month over month declines.

Eli McVey can be reached at [email protected]

6 comments on “Chart: Tourism drives hot start to recreational marijuana sales in Nevada, but where’s the ceiling?
  1. Brett Roper on

    Nevada was fortunate to have the entry of several out of state brands that neither Washington or Colorado had as well as a substantially under utilized medical marketplace that for comparison purposes likely under-performed Washington and Colorado for various reasons. The presence of these brands as well as ready to deploy products certainly helped jump start the adult use marketplace. WTG Nevada!

    Reply
  2. George Gonzo on

    As part of the “stats”…could you provide the “per capita” spend for
    the 3 states by “first six months” and “latest six months?
    Thanks
    George

    Reply
  3. DaCrizeam on

    Which cannibas suppliers are providing inventory in these states? Are there restrictions to who can supply? The Canadian market seems clearer.

    Reply
  4. Jenny on

    I just returned from a trip to Vegas and noticed tourism was precipitously low. In speaking with the locals, they feel tourism is down about 60% from where it normally is. They attribute it to the Mandalay Bay shooting. So, I am curious to see if that is the impact that is flattening out the numbers right now in Las Vegas.

    Reply
  5. Riese on

    I live in Vegas and the tourism is definitely lower right now but will start increasing again I promise. What is going to be amazing is when we open lounges and more social smoking locations. That’s why we’re watching CO…

    Reply

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