WA Retail Stores Fight Price Gouging

Washington State recreational marijuana shops have had it with the sky-high prices licensed growers are charging for cannabis.

Six retail store owners in the state recently joined forces to form a “retail association” to battle what they say is price gouging by many cultivators. The store owners have announced a plan to essentially blacklist growers who engage in such tactics – putting them last in line for shelf space – while rewarding those who deal with them fairly.

“We’re gonna have a lot of loyalty in our association to the growers that are treating us good now…and then the ones that are essentially sticking us for the higher prices will be the last to have shelf space,” one shop owner told a Washington TV station.

The price of recreational cannabis has hit more than $30 a gram at one shop, compared with $5 when it first opened. The owner blamed the increase on cultivators who are capitalizing on the industry’s well-publicized shortage of cannabis amid strong demand.

17 comments on “WA Retail Stores Fight Price Gouging
  1. Black Dog Acres on

    As a recently licensed producer/processor offering organically grown sun-kissed-bud we’ll be enjoying our 1st harvest this fall. However, we’ve spoken with many retailers and have assured them that we hope to price to them, including taxes, for about 1/2 of their retail costs including taxes. What I’m seeing instead is that some retailers are charging 4 times as much as what they’re paying the cultivator for…now that’s price gouging and unfair to growers.

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  2. LW on

    I knew there would be a problem, but it’s not just the growers. Blame it on the law being past with a 25% tax on the growers, another 25% tax on distributors AND another 25% tax on the retailers. By the time it gets to the customer there is a 75% mark up, and that doesn’t include sales tax!!!!! The law needs to be amended, so people can afford pot, without having to resort back to Joe down the block that is more affordable!

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  3. Clifton Middleton on

    The whole business is warped and corrupted by the regulations. Let folks grow and sell just like tomatoes and the market will take care of any and all problems. Where are the conservatives and small government folks when you need them?

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  4. linda warren on

    The greed factor is a work…See a need and screw the consumer. People have worked hard to secure the legal sale of MMJ. Support both medical and rec. markets, that way the “Black market” will be as quaint as Moon-shiners of the South.

    Reply
  5. Dee on

    Simple supply and demand. Only the supply is limited. I would agree to work with those growers that treat you best now and into the future. At $30 a gram that is a sure way to have a black market forever.

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  6. James on

    The retail mark up on cannabis is where the problem is. I think the dispensary folk should get out there in the field and do an honest days work like all farmers are required to do if they want a successful crop. Also, the consumer is so into the shopping experience, they should form co-ops with the farmers, do bulk purchase with their friends and distribute amongst themselves. Dispensaries have been taking the lions share of profits and ripping off the consumer while the farmer is taking huge risks, carrying the product through out a long season and getting ripped off when it comes time to go to market.

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  7. Jason on

    It’s fine to say that they wont give them shelf space but the reality is that they are still having trouble filling those shelves at all. Growers know it’s an empty threat. One thing the medical market did right was keep the price the same as street value. Until the stores can provide that then it will remain a joke, just a gram to get through the day until your dealer wakes up. I am sure it has been previously reported but the largest city in the state only has two stores.

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  8. Brad on

    Its a brand new game for those in the Recreational Cannabis Business. Being business… market conditions and relationships will evolve over time. Smart partnerships between growers, processors, retailers, and yes the LCB, will ensure the consumer gets a fair deal and still allows everyone to pay their bills. The high Tax component is unfavorable.

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  9. Mike Valinor on

    The entire grow canopy for marijuana in Washington state limited by the LCB is 2 million share feet or “46 acres.” There are 160,000 acres growing apples alone in Washington State. With such a small grow canopy prices will remain at the 30 dollar range for a long time. There will be marijuana shortages and high prices until the canopy increases ten times to 460 acres and even then prices will be around $15-$20 a gram.

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  10. LW on

    Again, as long as there is a 75% mark up by the time it gets to the consumer, not including sales tax, the prices will remain unaffordable. Most voters didn’t read the law before they voted, they just voted yes out of ignorance. I didn’t vote yes because the law was poorly written. I figured waited 50 years for the legalization, I was willing to wait one more year til it was written in a reasonable way. I knew we were going to have this problem, along with many more. Colorado should have been looked at more closely by the LCB, legislators and the voters!!

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  11. WashingtonWeedSales.com on

    Pricing fixing has been a topic of discussion through my circle and the forming of ‘association’ could have the same implications. Clifton says ‘Let folks grow and sell just like tomatoes and the market will take care of any and all problems’ but the problem with that is who-knows what pesticides Johnny Grower will put into the product. Personally, I don’t like smoking artificial chemicals.

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  12. FERobb on

    The system of legalization that has been constructed by the States has already been corrupted. There is no going back; or is there a chance to save the baby before we throw it out with the bath water. I say, let the people decide.

    Reply
  13. Brook on

    Being a grower and marketer, it appears that the grower is mostly on the “short end of the stick” when it comes to “fair share”…most store owner feel 150% minimum is fair for retail…coupled with the greedy of the govt (taxing 25% at three level plus sales tax????) is it any surprise that the blackmarket is growing in WA and CO….

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  14. Wolf Segal on

    Let’s see the dispensaries don’t grow it, but they charge double what it cost them. And the growers are greedy? Let’s get real here as long as the state milks cannabis for higher taxes than they had/have on liquor the black market will fluorish

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  15. bongstar420 on

    Funny. Everyone thinks the Cannabis tax is about “greedy government.” NOT!

    Ever heard of a sin tax?

    Its just what you pay to the puritanical establishment for the privilege of doing business on their turf.

    Progressive income tax only!

    Reply
  16. LW on

    I don’t think anyone is against pot being taxed, it IS the greed of Washington State to put a 75% markup, and that’s before it even reaches the retailer, where you’ll spend up to an additional 10%. Colorado’s mark up is 35% for recreational, and 2.9% for medical. Still high (so-to-speak), but not as unreasonable as Washington. It’s not a ‘privilege’ of doing business, it’s the right as an American citizen to be treated fairly by the government. Washington st. will see that by being so out there on their tax, that people will get their pot from Joe up the block. Why pay $20 for a dozen eggs when you can get it for $1.50?

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  17. Adam on

    Just so you all know, the retail markup implied by the states tax system is NOT 75%. It’s actually higher at around 95%.

    Math: 1.25 x 1.25 x 1.25 = 1.953125

    So yeah, the price pretty much doubles, which explains a lot of why the retail price is so high compared to the untaxed medical market. Add in extra demand and there you have it….

    Reply

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