While marijuana prices continue to plummet, marijuana businesses in Washington are having a hard time adjusting and keeping up with the changes.
Data collected from the Washington Liquor and Cannabis Board asserts that since the beginning of legal marijuana sales in July 2014, prices that started at $25 to $30 per gram have dropped to about $10 a gram now, noted The Daily News in Longview.
With taxes changing and lowering the wholesale price, cannabis costs are crashing as new retailers grind away in the competitive market.
This year, 222 marijuana licenses will be added throughout the entire state, which will include three new licenses in Cowlitz County, three in Lewis County and one in Pacific County.
The owner of 420 Holiday in Longview, Andy Dhalai, said in order to keep money coming in he is working to improve sales volume and expand clientele. He said as people become more comfortable with legal marijuana business should continue to be stable.
“At first people were scared to come into the shops because it was still federally illegal, but now . people are a little bit more relaxed,” Dhalai said. “I feel (the business) is still viable and there’s a lot more customers now.”
Store owners said their profits took a slight hit last summer when marijuana taxes were changed by the state. There used to be a 25 percent tax on producers, processors and retailers, but since the change there is now a single 37 percent tax at point of sale.
Hollie Hillman, a manager at Freedom Market in Longview, said she checks in on her competitors’ prices daily, sometimes dropping prices by a few dollars a gram to keep customers coming in. She said she doesn’t expect prices to fall much further, as they’re nearing illegal street market prices of as low as $7 a gram.
“I don’t think it can get much lower than that,” she said.