Marijuana sales in Aspen show recent decline
The city of Aspen’s most recent monthly sales tax consumption report, released Dec. 6, showed the marijuana industry slipping four of the last five months.
October $595,165 -6%
September $936,990 -7%
August $1,274,928 11%
July $1,101,313 -11%
June $839,076 -2%
May $466,514 5%
April $604,972 0%
March $1,484,782 10%
February $1,188,605 9%
January $1,331,103 11%
First 10 months of 2018 $10,065,565 Up 5%
Source: City of Aspen Finance Department
Aspen’s legal marijuana trade has enjoyed some good buzz since Amendment 64 took effect, including its hurdling liquor stores in total revenue in 2017. But a recent report indicates all is not rosy in the world of buds, vaporizer oil, edibles and other cannabis products.
Medical and retail pot sales dropped in June, July, September and October, following a robust first quarter when budtenders rang up $4 million in sales during the first quarter, according to the city of Aspen Finance Department’s monthly consumption tax released Dec. 6.
Whether that is an aberration or trend, however, is another question.
“There are a lot more stores on Interstate 70, and some people might be doing their shopping before they come to Aspen,” said Pepe Breton, founder of the Denver-based Euflora chain, and 50 percent owner of the recently opened Aspen shop. “Also, it just seems the market in Aspen is getting so much competition and that people keep lowering prices. The same amount of people might be buying, but the prices are getting lower.”
Merchants buying wholesale marijuana also have seen steep decreases in their purchase prices, he said, noting that about two years ago a pound of bud would fetch $2,000.
“Now you can buy a pound for $800,” Breton said.
A Nov. 16 report in The Washington Post notes wholesale marijuana prices in Colorado plummeted by one-third in the past 12 months and 70 percent over the past four years.
“Ironically, in a bid for more tax revenue per marijuana sale, Colorado increased its marijuana tax rate from 10 percent to 15 percent last year, only to see the anticipated added tax revenue wiped out by falling prices in a year’s time,” the report said.
Aspen is home to seven cannabis dispensaries (some sell both retail and medical products), and an eighth one is set to open in the first quarter of next year. The number of shops, noted the co-owner of the Denver-based Green Dragon chain, which has 12 shops in Colorado, including one on the Hyman Avenue mall, means “this market is artificially inflated.”
“Everybody thinks they can open a shop, and it’s a ticket to print money,” Alex Levine said. “It’s very hard to run a comfortably profitable business by entering the industry without a game plan.”
It would behoove the city to place a moratorium on new pot shops or regulate the number of licences it allows, Levine said.
“The pie just keeps getting bigger,” he said, “and I think it’s irresponsible to the quality of the town.”
For the first 10 months of the year, Aspen medical and retail marijuana stores combined to generate $10.1 million in sales, which is still up 5 percent over January through October of 2017, according to the city’s report.
This year has been buoyed by January, February and March — also prime time for ski-season tourism — which accounted for $4 million in pot sales while posting respective gains of 11 percent, 9 percent and 10 percent over the same months in 2017.
Yet June (down 2 percent), July (down 11 percent), September (down 7 percent) and October (down 6 percent) all were outpaced in sales by the same months in 2017, the report showed. August, however, chalked up nearly $1.3 million sales, the year’s third-most lucrative month and 11 percent better than August 2017, according to the report.
Aspen’s liquor stores, by contrast, have recorded $8.6 million sales through October of this year. Last year, Aspen pot shots brought in $11.3 million in revenue, compared with $10.5 million in sales rung up by liquor stores.
Statewide through October, marijuana, medical and retail pot saw $1.28 billion in sales from January through October, edging out the $1.25 billion in sales for the same time period in 2017, according to the Colorado Department of Revenue.
Since January 2014, when retail marijuana was sold legally thanks to the passage of Amendment 64 in 2012, Colorado has generated $5.78 billion in both retail and medical cannabis sales, based on figures from the revenue department.
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