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Nevada Grows Into A Billion-Dollar Cannabis Market

October 19, 2021

Driven by Las Vegas, Nevada is quietly growing into a powerhouse cannabis market. Combined medical and adult-use cannabis sales totaled just over $1 billion for the state’s fiscal year ended June 30, according to data from the Nevada Department of Taxation. Sales climbed steadily over the 12-month period, from $77.9 million in July 2020 to $91.8 million in June 2021, peaking at $97.6 million in April of this year. Sales were overwhelmingly driven by Clark County, home of Las Vegas, where consumers spent $791.1 million in the fiscal year; second-place Washoe County was far behind at $135.3 million, with the rest of the state combined contributing $77 million. The state collected $157.8 million in cannabis tax revenue.

Sales for the fiscal year were up more than $300 million from the prior year’s total of $684 million, a figure that reflects suppressed business in spring 2020 due to early pandemic restrictions. But it’s also notable that the strong sales growth in fiscal 2021 is not due to an expansion in availability. There were 71 retail locations for recreational cannabis in July 2020, which grew to 83 by June 2021, an increase but hardly one that predicts a 46% annual sales jump. This indicates that more consumers are seeking out cannabis or seeking it out through licit channels for the first time.

“We see from this data that the adult-use market is reaching its potential, and we’re excited for what’s ahead,” Layke Martin, executive director of the Nevada Dispensary Association (NDA), told SNDC. “During the pandemic, many retailers were forced to adjust their business models. Some of those changes have actually remained and continued to grow, such as curbside pickup, drive-through and home delivery. Next year we will also see consumption lounges opening, which in addition to giving tourists a safe and legal place to consume, will create opportunities to introduce and educate new customers.”

“This is a monumental milestone for the State of Nevada and the cannabis industry to pass $1 billion in sales last fiscal year,” adds Brandon Wiegand, chief commercial officer of The Source dispensary, which has four locations in the state, and an NDA board member. “Many of these dollars would have been spent in the illegal black market, supporting criminal enterprises and generating no tax revenue for our state. Instead, through legalization and regulation, we created jobs and stability during an extraordinarily challenging year,” he told SNDC.

As Martin noted, the prospect of cannabis lounges is an attractive one to the Nevada industry. The state’s Cannabis Compliance Board is currently drawing up regulations, with a goal of issuing licenses early next year and venues opening their doors by next summer. Spaces like these remain a relative unknown from a commercial perspective, as they’re nearly untested in the U.S. so far. Many voices in the industry expect them to play an outsized role in further mainstreaming cannabis use in social settings, with potentially major implications for public acceptance and sales.—Danny Sullivan

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