Are recreational marijuana sales in Illinois underperforming given the state’s large population?

While Illinois topped $1 billion in total cannabis sales in 2020 as consumers scooped up adult-use products, the new recreational marijuana market there might actually be underperforming when considering the state’s large population.

Illinois consumers purchased 14.5 million recreational marijuana products last year, generating $669 million in sales.

While nowhere near California’s first-year numbers, that amount is almost double what Colorado, Oregon or Washington state brought in during their first 12 months of recreational sales after adjusting for inflation.

But per-capita numbers suggest a different story.

With a population of 12.7 million people, Illinois has a few million more residents than Colorado and Oregon combined.

Yet, first-year adult-use sales per resident in those states were $10 or more higher than in Illinois.

Oregon’s first year netted $87.38 per capita and Colorado’s $61.78, while Illinois brought in only $52.81.

Per Capita Sales

First 12 months, adjusted for inflation
StatePer Capita Sales
Washington St.$40.10

It is difficult to say what is causing the disparity, given the many factors going into the launch of a new market.

In Illinois, problems and lawsuits have hampered adult-use marijuana licensing as well as the state’s social equity program, which is aimed at getting more minorities and victims of the war on drugs involved in the cannabis industry.

Also, the lack of licenses and infrastructure while launching new markets can cause sales to be less than expected.

This was the case in 2018 when California marijuana businesses launched recreational sales but struggled with local bans and high taxes.

And it shows in California’s per-capita sales during the initial 12 months.

While California consumers purchased about $1.5 billion worth of recreational marijuana products in 2018, that amounted to only $38.41 per resident.

It could also be an indication of the strength of California’s illicit market.

High taxes in California and Washington state could be pushing a significant number of consumers to purchase their marijuana from sources outside the states’ legal markets.

Washington state generated $54.70 in per capita adult-use sales during the first 12 months – or roughly the same as per-capita sales in Illinois.

Andrew Long can be reached at [email protected]

4 comments on “Are recreational marijuana sales in Illinois underperforming given the state’s large population?
  1. Van McConnon on

    Illinois operators are getting their ass kicked by the black market. Bad regulation and piss poor operators depress sales. Why pay twice as much for inferior product? Same thing is true in California.

  2. Matthew Wellin on

    It’s pretty clear to most Illinois consumers that the products are 20% more expensive than black market. While the access has opened up, the value proposition is down. The dollars reflected in the article account for total sales, but many mitigating factors such as quality and customer retention are not shown. Initial legalization promotes an idea of access for the consumer, and that is acted upon with nostalgia. But quite frankly the Illinois recreational pricing model isn’t a sustainable model for consumers, unless they acquire a medical card and pricing. The circumstances for this tier are debatable, evidenced by the vast submarket of clinics offering such access to residents is a clear sign Illinois hasn’t settles into a healthy model quite yet. After speaking with a local black market dealer (BMD) on 2020 general sales performance, they indicated both the high prices of legal, and the time spent quarantining actual drove profits above 2019.
    “People came back around April. They would go wait in line for the rec, maybe once. But the (product) cost too much. Plus it wasn’t fire enough to not call me back! lol $17 for join? Cmon” -BMD
    Perhaps the upcoming capital injections will help stabilize and settle the operations into model that can both gain profits and innovate product choices and pricing that cater to the market. Wide-eyed non-market investors and administrators must always remember that cannabis is a unique product with much opportunity, but this is still a consumer driven market that will decide who will be successful in the long run.

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