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Immune to COVID: Legal Weed Vs. Delta Variant

cannabis sales during COVID pandemic

In the thick of coronavirus lockdowns, and before Pfizer, Moderna, and Johnson & Johnson concocted vaccines, many of us turned to an old, trusted elixir to combat the symptoms of lockdown. Marijuana became the remedy of choice for millions of individuals battling the uncertainty and angst that came along with the quandary of a pandemic.

Long before the coronavirus pandemic, the word “unprecedented” was on the lips of many while discussing the possibility of marijuana legalization. Remember, it was only about 10 years ago when Colorado and Washington became the first states in America to legalize recreational marijuana.

Now, almost half of the states have legalized recreational marijuana, with many more allowing medical cannabis use. Whatever stereotypes (laziness, lack of ambition, etc.) are attached to marijuana, the cannabis industry has proven itself focused and resilient. These characteristics are illuminated when analyzing the role legal weed has played throughout the coronavirus pandemic.

Take, for example, the skyrocketing marijuana sales figures of 2020. The cannabis industry is one of few that strengthened its economic foothold despite the unparalleled circumstances brought upon American businesses.

But now, with a new Delta variant of the coronavirus on the rise and whispers of potential lockdowns lurking, can we expect a continuation of legal weed’s successes?

A COVID Economy, High on Weed

cannabis sales skyrocket during COVID pandemic

When Denver, Colorado issued a stay-at-home order last Spring, the city announced restrictions would begin on March 24th. The day before, March 23rd, Denver’s cannabis stores experienced their largest marijuana sales to date.

Halfway through the day, about four times more weed was sold than is bought on a typical day (Denver Post). This was an early, and clear green flag for what was to come. After all, In Colorado, sales ended up increasing by almost $500 million in 2020 from the year before and are well on track to set new records for 2021.

According to Rob Harder, Director of Finance at the cannabis company Harmony Extracts in Colorado, COVID has certainly played a part in this explosive growth.

“Some of that has come from naturally expanding our teams and growing the business, but I would attribute a significant chunk of the growth seen in 2020 as a direct result of the COVID situation. Specifically, a combination of multiple factors: people spending a lot more time at home (job loss, not going out for usual social activities or travel or even chores and errands), stimulus payments providing ample disposable income (in many cases more than people were making while working), and cannabis providing a great solution to combat both the anxiety and boredom brought on by the isolation of lockdown.”

Similar to Colorado, the Oregon legal weed market has prevailed despite pandemic hindrances. At the start of Oregon’s coronavirus lockdowns in 2020, marijuana sales in Oregon rose 20%.

Many in Oregon’s weed industry were not sure how long this newfound demand would linger, however sales steadily increased in the following months. In all, Oregon’s sales increased from $795 million in 2019 to $1.11 billion in 2020, based on data from the Oregon Liquor Control Commission. A new and significant record for the state’s marijuana market.

These Colorado and Oregon trends can be reflected on the national scale, as the United States was just shy of a whopping $18 billion in legal weed sales in 2020, increasing by almost 50% from 2019 (New York Times).

With increasing marijuana sales comes increasing tax dollars, which in turn provides much-needed funds for states who have seen many of their industries impaired in the COVID economy.

Washington State, for example, saw tax revenues from marijuana approach half a billion dollars during the 2020 COVID-19 crisis, jumping from $395.5 million to $473.9 million, according to the Washington State Liquor and Cannabis Board’s Annual Report for the 2020 fiscal year.

With towns, cities, and states realizing the potential of cannabis tax dollars, it is no wonder those dollars are being put to use in new programs to combat the economic and social detriments of COVID.

One proposal moving forward in Colorado, and supported by a bipartisan team of educators, parents, nonprofit leaders, and state lawmakers, is to use cannabis tax money to help the state’s low-income children recover from pandemic-related learning loss (Denver Post). If the measure is passed, officials expect around $137 million to benefit this program.

The clear benefits of taxed marijuana are too prominent to be swept under the rug, especially in a time where state and local budgets are in danger from an unpredictable pandemic and new virus variants.

That, combined with the fact that the cannabis industry is the country’s largest source for new jobs means that legal weed can be a significant weapon against the haunting specters of revenue loss and unemployment caused by the pandemic.

Cannabis Business Practices, Adaptable to COVID

online cannabis ordering COVID

Cannabis industry professional Rob Harder describes the two sides to COVID that he has witnessed in the cannabis industry. “One side is sales/financials which has seen great uplift from people staying at home and getting that stimulus money. The other side is operational/employees and that side has been massively impacted and challenging to keep production running smoothly in an industry that requires in-person labor.”

So how did cannabis product manufacturers like Harder’s employer rise to the challenge? “We wanted to make sure all of our teams could feel safe still coming into our facilities,” Harder explains, discussing the stringent work-safety measures implemented including strict masking, distancing, and increased sanitation. “We also have multiple production facilities across Denver and while normally teams would rotate around the buildings we have now kept employees at a set location with limited movement between our facilities.”

“If you are not adaptable, then this isn’t the industry for you,” Daniel Grossman says, who is the operations manager of edible producer Cannapunch in Colorado. Grossman notes a substantial battle brought on by the pandemic for cannabis product manufacturers like him was in materials acquisition. “We produce cannabis-infused drinks and the bottles we utilize were being purchased in mass by other companies for a premium for hand-sanitizer production. It was very difficult to locate our production essentials.”

On the retail side of things, coronavirus caused a far more pronounced shift in how many dispensaries got cannabis into the hands of consumers.

A New York Times article detailed how one Florida medical dispensary Fluent Cannabis Care encouraged online orders and curbside pickup during the height of the pandemic. Incentives like senior citizen discounts, student discounts, and new customer discounts coaxed consumers out of the house.

“For us, it became less about the in-store experience and more about offering our customers deals and the ease of pickup,” Owner Oswaldo Graziani Lemoine told The Times, explaining how his company is now planning for stores that are express pick-up only. “No lobby, no counter, just preorder and drive-through.”

These growing pre-order trends are apparent all throughout the cannabis industry, with one Massachusetts business owner telling the New York Times “preorders have become almost 100 percent of our business, so we bought more hands.”

Connor McTaggart, who worked as an inventory manager at a recreational dispensary during the height of the pandemic, told Caliconnected that he credits a robust pre-order system as well as a new drive-thru option with allowing his company to stay afloat.

A focus on marijuana delivery is another symptom of a socially-distanced COVID economy. In Nevada, one of the state's largest cannabis delivery businesses, saw a 400 percent increase in deliveries statewide after the state issued pandemic restrictions.

Many other marijuana dispensaries began offering a delivery option in response to those restrictions, keeping sales consistent and in many cases increasing revenue.

The resilience of the cannabis industry can be attributed to the resilience of its people.

Many of the individuals at the helm of marijuana companies have fought tooth and nail for years, even decades, against the unknown, and consider this pandemic a curveball that is par for the course.

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