Legal Marijuana Sales Reach 21 Billion Worldwide: Time to Join In?
- 1. The reasons marijuana sales increased in 2020
- 1. a. Marijuana sales during pandemic
- 2. Taxes as approximation of marijuana sales
- 3. Ways to jump on the bandwagon
- 3. a. Cannabusiness jobs
- 3. b. Invest in marijuana stocks
- 3. c. Starting a cannabusiness
- 3. d. Become a breeder for seed shops
- 4. Marijuana sales are skyrocketing. and so should your career
A report published recently by BDSA demonstrates not only the robustness of today’s legal marijuana sales and the cannabis market in general. It also points to an exciting opportunity for anyone willing to join this budding industry and make use of its growth potential. Marijuana sales worldwide exceeded $21 billion in 2020. This is an increase of 48% compared to 2019. BDSA report also forecasts marijuana sales to grow at a compound annual growth rate of more than 17% and reach $55.9 billion in 2026. Analysts expect the growth to be mostly fueled by new markets as legalization progresses.
The Reasons Marijuana Sales Increased in 2020
The growth of marijuana sales in 2020 happened for a variety of reasons, some of which were expected, while others counterintuitive, according to BDSA experts.
- New markets are key. While mature markets saw a considerable acceleration of growth compared to the previous year, it was new markets that remained the major driver of growth in the industry. They contributed $1.6 billion in spending in 2020. The same applies to the near future. In the US, four new medical and five new adult-use markets are expected to commence sales in 2021. Globally, the demand for legal cannabis will be driven by Mexico which recently decriminalized the adult use of the substance, but also by Germany, the UK, and France.
- Introduction of new product options. In Canada, the totally new segment of the marijuana industry called “Cannabis 2.0” and comprising edibles and ingestibles saw the fastest growth in 2020. Lifting the ban on these products in October 2019 boosted marijuana sales in this country. They totaled an estimated $2.6 billion and are forecast to grow at a CAGR of 16%, reaching nearly $6.4 billion in 2026.
- Lockdown-driven demand. The COVID-19 pandemic, contrary to expectations, didn’t hurt marijuana sales. If anything, it boosted them, especially in the recreational sector.
Marijuana Sales During Pandemic
The COVID-19 crisis was considered one of the major challenges the emergent cannabis industry was facing in recent years. It came as a surprise that it actually boosted marijuana sales as recreational smokers had more free time for their ‘vice’ due to lockdown measures.
“The industry not only survived, it thrived, and legal cannabis gained considerable ground, exceeding our expectations in several markets,” said Micah Tapman, BDSA’s CEO.
A positive dynamic due to COVID-19 was seen in many mature markets which saw a substantial acceleration in growth compared to the previous year:
- Colorado: 26% rise vs 13% in 2019,
- Oregon: 39% rise vs 21% in 2019.
Taxes as Approximation of Marijuana Sales
Marijuana sales data are important for cannabusiness startup creators and entrepreneurs, but obviously, it’s taxes that politicians think of when they consider (and advocate for) the legalization of the substance. This is why marijuana tax estimates are so important. They also serve as a proxy for marijuana sales projections if other data is lacking.
In the table below, you can see some actual numbers along with some juicy what-ifs (the latter show how much cash the authorities would have at their disposal if only they had enacted legalization laws and/or started to regulate and tax marijuana sales).
| Actual Numbers | |||
|---|---|---|---|
| State or City | Marijuana Taxes | Type of Legislation | Year of Legalization |
| Alaska | $11M | Recreational | 2014 |
| Washington | $362M | Recreational | 2012 |
| Oregon | $82.2M | Recreational | 2014 |
| California | $345.2M | Recreational | 2016 |
| Nevada | $69.8M | Recreational | 2016 |
| Colorado | $250.9M | Recreational | 2012 |
| Estimated Numbers | |||
| State or City | Marijuana Taxes | Type of Legislation | Year of Legalization |
| Phoenix, AZ | $25.71M | Recreational | 2020 |
| Dallas, TX | $22.5M | None | N/A |
| Houston, TX | $39.32M | None | N/A |
| Chicago, IL | $52.77M | Recreational | 2019 |
| Miami, FL | $7.16M | Medical | 2016 |
| Washington, D.C. | $20.96M | Recreational | 2014 |
| Philadelphia, PA | $30.16M | Medical | 2016 |
| New York, NY | $156.4M | Recreational | 2021 |
| Boston, MA | $12.61M | Recreational | 2016 |
Ways to Jump on the Bandwagon
By now we’ve probably driven our point home: that legal marijuana sales will continue to boom in the coming years and that this burgeoning industry will be a cornucopia of opportunities for cannabis enthusiasts. So how can you join in?
Cannabusiness Jobs
If you’re young, have no money, and your only asset is ‘human capital’, you’re still in a unique position because you can take any of the dozens of entry-level jobs in an industry that is developing at a breakneck pace. This will set you on a career path with virtually unlimited opportunities.
We wrote about cannabusiness jobs in a separate post. The gist of it is that, as more and more countries and states legalize marijuana, the more and more ambitious young people can find a job of their dream in an industry that will appreciate their passion for cannabis.
So be on the lookout for interesting offers, apply for special permits and licenses (if required), and send out as many job applications as you can.
Here’s a short list of positions that are available where marijuana has been legalized:
- marijuana production (cultivator, harvester, master grower, trimmer, extraction technician, master extractor, etc.),
- product testing (marijuana tester, quality control inspector, etc.),
- edibles and beverages industry (edibles chef, cannabeer brewer, etc.),
- marijuana sales (packager, receptionist or cashier, budtender, dispensary manager. etc.)
- delivery services (drivers and other specialists).
Of course, like in any mature industry, there are dozens of cannabusiness jobs where you don’t get near plants or products but can apply your other skills to ensure the smooth running of the business. These jobs could be anything—from electricians and plumbers to software engineers and designers to lawyers and compliance officers. And you still get such perks as better than average pay and the opportunity to fast track your career.
Invest in Marijuana Stocks
There is a growing list of exchange traded companies that either directly or indirectly benefit from the ‘green rush’. The former include those that grow, distribute, or sell marijuana and its products where it’s legal. The latter are involved in research or make use of the medical benefits of the plant (e.g. biotech and pharmaceutical companies).
Investing is a high risk/high reward activity and so isn’t for everyone. But if you know what you’re doing and can stomach short-term losses in hopes of having long-term gains, you may do worse than add a few marijuana stocks to your portfolio.
And if you’re not qualified to research those companies and assess their value and potential (most of us aren’t), there are several marijuana ETFs, or exchange-traded funds, at your disposal. Marijuana ETFs are a great way to get exposure to the whole sector without experiencing (sometimes bone-crunching) ups and downs of individual marijuana stocks.
Starting a Cannabusiness
The marijuana industry of today is a breeding ground for millionaires of tomorrow, but to be a part of this success you’ll have to go all-in. Starting a cannabusiness either in growing, or in the production of edibles and other marijuana products, or in selling weed through a dispensary will require at least a quarter of a million in the first year for a smallest-scale unambitious project. So even getting your foot in the door isn’t easy, but the possible rewards are worth it.
In many respects, starting a cannabusiness isn’t that different from any other business. Nevertheless, there are certain things that are unique to this industry.
You’ll need to deal with getting licenses and permits, securing funding (which could be harder than you think in an industry that is only marginally legal), and finding a way to manage your day-to-day financial operations if banks refuse to work with you.
We have covered all these aspects of starting a cannabusiness in some detail in another post. We encourage you to read it as the first step in your research.
Become a Breeder for Seed Shops
We understand that for many of our readers all of the above is hardly feasible for the simple fact that marijuana hasn’t been yet legalized everywhere. But even if you live in a state or country with rather restrictive marijuana laws, maybe you still can take part in the green rush without breaking the law.
Many jurisdictions—even if they forbid marijuana sales—allow small-scale cultivation for personal needs. In many cases, growing a few plants at home is all that is needed for a quite serious breeding project.
ALL bestselling strains of old came from somebody’s personal stock. Today, a lot of breeding is done by professionals, but amateurs contribute their lucky finds to the genetic pool all the time. Imagine hitting the jackpot with something like our Strawberry Banana Auto with her 27% THC, bud production of up to 600gr/m2, and bold fruity terps. Imagine your own strain in a major seed bank’s catalog and in every online seed shop. Finally, imagine the revenue stream this could generate.
Marijuana Sales are Skyrocketing. And So Should Your Career
To recap, marijuana sales have demonstrated an impressive growth rate, proved their robustness during economic turmoil, and are poised for aggressive expansion in the immediate future. So the cannabis industry may be your one shot for major success in life.
