A major argument when talking about legalizing cannabis is the fact that legitimate businesses can bring in thousands – even millions – in revenue. Unfortunately, this is contingent on the consumers being willing and able to purchase their supply from the legal retail market, rather than the same dealer they’ve been going to for years. The best way to get people to do that is to offer a product that is the same or better in quality for a similar or lower price – and with more convenience. It seems the Massachusetts legal retail industry has missed all these marks.
“We’re seeing the opposite of that,” said Maggie Kinsella, press secretary for the Massachusetts Cannabis Reform Coalition. “The whole reason was to prevent diversion to the illicit market, but people are going there because the cost is not realistic.”
Massachusetts has had an extremely slow rollout for recreational cannabis sales – which should come as no surprise considering their medical marijuana program was barely off the ground when adult use was legalized. Now, three years later, there are 15 dispensaries open around the entire state, leaving very few options that are likely not all that convenient to many cannabis consumers there.
On top of the limited number of locations that are available for consumers to buy legal cannabis, the high price of the product – even before taxes – doesn’t encourage people to buy from the legal market. According to the Boston Herald, the average price of a 1/8th on the black market in Massachusetts is about $25. To purchase from a dispensary, it would run double that price, about $50, before the 17-20% in taxes is included.
“The unlicensed market continues to flourish, due in part to the competitive financial advantage such operations have over legal cannabis businesses, which are committed to paying license fees and collecting taxes,” a report by the Cannabis Advisory Committee reads.
The goal of legalization is certainly to bring the underground market into the world of legitimate business – but this often doesn’t leave room for your old dealer as much as new business owners and investors. It’s clear by how busy these 15 dispensaries are and how hard the industry works to keep up with supply that people are willing to make the switch to buy from retail shops.
However, it’s a matter of making the product both accessible and affordable, so consumers are more likely to go to the shop with tested and verified products over the guy growing bud in his basement.