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From Dispensaries to Superstores: Opportunities in U.S. Cannabis Retail

Part of the Cannabis Intelligence Briefing Series

Published October 2019

Co-produced by Arcview Market Research and BDS Analytics, the From Dispensaries to Superstores: Opportunities in U.S. Cannabis Retail report investigates the current--as well as a look to the future--cannabis retail environment and the influence cannabis sales are having on the broader retail landscape across the U.S. 

With legal cannabis spending in the U.S. growing at a compound annual growth rate of over 20% (from $9.8 billion in 2018 to $30 billion in 2024), retailers are undoubtedly in position to capitalize on this lucrative opportunity. In preparation, the young retail cannabis sector is entering a new phase of development, shifting from simply building sustainable single-state business models and market share, to national, multi-state expansion.

As of the of the 4th quarter of this year, just four states - Oklahoma, California, Colorado and Oregon - make up 80% of the total active retail licenses, a clear indication of the legal cannabis industry’s relative immaturity as a consumer retail channel.

The most successful single-state operators are looking to leverage early market share into broader national expansion, while still maintaining margins and fending off new competitors. Many of those new competitors come with deep pockets, using the public equity markets to fund business plans aimed at scalable, national chain-building from the outset.

The potential is evident through the strength of buyers. Consumers in adult-use markets are much more likely to buy their cannabis from a storefront dispensary or delivery service. Among Consumers in adult-use states, 54% report buying their cannabis from a recreational dispensary in the past six months, while 26% report purchases from a medical dispensary and 10% report buying from a delivery service.

The birth of the cannabis “superstore” is an important milestone in the cannabis industry, though the cannabis “store of the future” will take many forms before retailers ultimately decide what works best with the exploding base of cannabis consumers.

The 35-page report features deep market insights and 16 data-rich charts and graphs.

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