A new study by Brock University’s Goodman School of Business compared cannabis store numbers to adult-use sales and consumer numbers to see how store growth impacts consumer sales and uptake, according to the Conversation.
While store numbers and sales are “strongly related,” according to the study’s author, consumer numbers were a different story: there was just an eight per cent increase in consumer numbers — and “almost the same user growth occurred regardless of how many shops opened. But where shops were plentiful, users increasingly bought legally.”
Why it matters
Across North America, not every municipality that’s located in a legal cannabis jurisdiction has welcomed cannabis retail stores. One of the main reasons cited by town councils is concern that stores will encourage more people to take up cannabis consumption.
“But my study implies communities will see similar user growth after legalization whether they allow shops or not,” writes the author. “Those users will increasingly buy legally if local shops open. But without such stores, users will keep visiting illicit sources where products might be misrepresented or contaminated.”
Legalization pains without gains
Slow-moving retail rollouts could also have the same effect, cautions the author. In Mexico and South Africa, for example, regulators have been slow to design and implement legal access points.
“Both countries should rethink their reluctance,” he cautions. “If they don’t provide practical legal access to a theoretically legal substance, they risk getting legalization’s pains without its gains. The main winners will be illicit dealers.”