California Cannabis companies, which have been listed as ‘essential’ in California, have reported record profits and putting a large dent in black market sales amid the COVID-19 coronavirus outbreak.
A new ‘essential’
When California Governor Gavin Newsom locked down the state last week, he, as well as many city and local leaders, noted businesses as “essential” or “non-essential.” While many businesses were seen as essential by the public such as grocery stores, pharmacies, and gas stations, others raised the eyebrows of critics. One of the last businesses to be listed as essential, cannabis, has also been one of the more controversial because of questions over how “essential” the industry is at this time.
“We got a lot of complaints over that here,” said Charles Cho, a strip mall owner in Los Angeles. Only the bank here and the [marijuana] store were allowed to stay open. All of my other tenants had to close, and two of them tried to force me to close the [marijuana] store because they didn’t think it was right.”
“A few other people I know have questioned me about it too. But it’s legal to have it stay open, and the owners have said they would like to remain open. It’s out of my hands. And I’ll be honest, it’s good to know I’ll be having some money coming in.”
In the first few days after the lockdown there were questions over whether it really was essential, as it wasn’t listed as forbidden. But going into the second week of the lockdown much of the animosity has turned into acceptance.
The person behind marijuana being listed as essential is Nicole Elliot, the senior adviser on Cannabis in the Governor’s Office of Business and Economic Development. While medicinal marijuana was going to be allowed in any case because of healthcare concerns, recreational sales were allowed as well since Elliot didn’t opt to separate the two in the Governor’s order.
“Because cannabis is an essential medicine for many residents, licensees may continue to operate at this time so long as their operations comply with local rules and regulations,” said the Bureau of Cannabis Control in a statement.
“The big reason why we’re open is because of marijuana being used for medicinal purposes,” explained Los Angeles cannabis shop employee Alonzo Lee. “We were all scared we’d be all out of a job, but we got through because of the medicinal thing. Pharmacies and CVS can stay open, and because we are also used for healthcare reasons, so can we.”
“And now we’re busier than ever. We actually had to hire more delivery people.”
A boost in sales and a possible saving of the industry
In the last few weeks marijuana sales statewide have gone up 230 percent. Similarly, Weedmaps reported a similar 204% growth in California sales over 7 days. And with the lockdown in place, sales continue to climb.
“Today (Tuesday) so far we’ve sold what we usually sell in a week. It’s been crazy,” added Lee.
The uptick in sales has also been combating sales of black market marijuana.
“We were worried about going out of business due to all the illegal weed out there,” said Lee’s co-worker Vic Kendall. “Dealers have run out largely now, so we’re the only game in town, and it shows. A lot of cannabis farms also tend to stockpile supplies anyway, so we’ll be fine for awhile supply-wise.”
“So many people are staying at home and they need to pass the time. And smoking weed passes that time at home, all self-quarantined and everything.”
Employees of cannabis shops will still have to adhere to CDC regulations while open, something Lee’s store and others are doing.
“We’re being checked,” conveyed Lee. “We’re all wearing gloves and masks. And we have sanitation wipes we’re using on everything, especially orders for people using it for medical purposes. We had someone here who worked at a Walgreen’s pharmacy during a big flu outbreak, and we’re using those standards.”
Cannabis stores, both recreational and medicinal, are expected to remain open during the state lockdown.