The marijuana business has been booming for a long time, regardless of its legal status. However, as various states legalize it across the country, that money is starting to be taken out of the black market and channeled through legal streams. This means that weed sales across the U.S. and Canada, have the potential to fund school projects, pay for law enforcement and other programs that go towards helping the community at large, not to mention providing jobs at a time when many other industries are sending jobs overseas.
Moving Away from the Underground
The decriminalized, legal weed market also saves local government the money it would spend on the law enforcement, prison and court costs involved in arresting and processing marijuana related charges. All in all the legal market moves business and money away from the underground and moves it into the mainstream where it has the chance to profit everybody.
Legal and Illegal Sales Factored
Archives Market Research, a leading company in marijuana related market research, did a study to discover just how much money was being spent in the U.S. and Canada and how much of that money was in legal weed sales. As it turns out, the total amount they found being spent in 2016 was $53.3 billion in the U.S. and Canada combined. This total includes both legal weed sales and illegal sales.
A Significant Hit to Black Market Weed Sales
Of this total, $6.7 billion was spent on legal marijuana sales and the rest was spent in the black market. While the number may seem disproportionate, the legal marijuana industry sales were up 30 percent in 2016, as compared to the year prior. The black market sales went down from taking up 90 percent of all weed sales in 2015 to 87 percent in 2016. This shows a definite gradual progression away from the underground towards the legal market.
Moving Demand as Opposed to Creating It
According to Business Insider, Troy Dayton, CEO of Arcview Market Research said in a statement, “The enormous amount of existing, if illicit, consumer spending sets cannabis apart from most other major consumer-market investment opportunities throughout history …. the cannabis industry doesn’t need to create demand for a new product or innovation — it just needs to move demand for an already widely-popular product into legal channels.”
The Demand for Legal Marijuana
Last November’s election saw a huge win for marijuana reform when California, Nevada, Massachusetts and Maine all voted to legalize recreational marijuana, making the total number of states with legal marijuana 8 plus D.C. This means 20 percent of the U.S. has legalized marijuana. November also saw more states legalize medical marijuana, bringing the total number of states with legal medical marijuana up to 28 plus D.C., well over half of the country. Many other states, including Rhode Island and New Jersey are contemplating legalizing marijuana through legislature this year too.
While it may take until mid-2018 to get the industry infrastructure in place in many of these states, it does show that the United States and Canada are well in the process of taking the black market marijuana sales into the mainstream. For now, we can look forward to a steady move away from the black market as the industry booms throughout the U.S.