Michigan voted to legalize recreational cannabis back in the spring of 2018. On December 1, 2019, the first dispensaries opened for business for recreational customers. However, legalization happened more quickly than businesses had planned, which meant just a small handful of shops (largely in Ann Arbor) were open in time for the December 1 deadline. In spite of that, sales exceeded $200,000 just on the December 1 opening.
However, since legalizing recreational cannabis, Michigan has experienced recreational cannabis shortages. Medical consumers are protected because of laws requiring that 50% of all dispensary stock be reserved for medical use, but recreational users faced long wait times.
Because so few dispensaries sell recreational cannabis, overwhelming demand meant shoppers faced long lines and product shortages. This has improved in the weeks since: Michigan currently has 10 businesses with recreational licenses, and the state’s marijuana authority says it plans to issue 12 total before January 1, 2020.
Michigan had an overwhelming response to legalization, with so many shoppers showing up that dispensaries had to institute purchase limits. One dispensary opened its doors on December 6, only to close them two days later on December 8 when it ran out of stock. But with over 750 customers and $75,000 in sales, the dispensary exceeded revenue expectations.
The good news is that, despite shortages, producers are picking up the slack. 40 pounds of flower will make its way to the dispensary next week for shoppers anxious to stock up on bud.
In just its first week of legalization, Michigan saw $1.63 million in recreational cannabis sales. Although shortages will plague the state in the early days of legalization, producers are quickly ramping up the production for thousands of pounds of cannabis. Investors shouldn’t feel spooked by shortages; if anything, they’re a common consequence of legalization. Still, time will tell how the Michigan cannabis market will perform as more dispensaries obtain recreational licenses.
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