Ohio’s Cannabis Industry Tops $44 Million in Sales in First Month

Ohio’s adult-use recreational cannabis sales surpassed $44 million in its first month, with dispensaries experiencing additional demand of $10 million a week above initial estimates. However, despite the initial success, the state’s cannabis market still faces strict regulations, licensing caps, and tight advertising rules, with several businesses already fined for noncompliance.

Ohio’s cannabis industry has seen substantial growth since the launch of adult-use cannabis sales on August 6, 2024. In the first month alone, cannabis sales exceeded $44 million, according to Ohio’s Division of Cannabis Control (DCC).

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Explosive First Month

In the first five days of adult-use cannabis sales, Ohio generated over $11.5 million in revenue. By the end of August, total cannabis sales, including both the medical and adult-use markets, had surpassed $44 million.

State dispensaries, particularly those transitioning from selling medical cannabis to adult-use cannabis, reported unprecedented demand from their customers.

Mandy Morton, owner of Locals Cannabis, highlighted the dramatic increase in foot traffic, telling WCMH that her dispensary had seen “at least six times more people” than when it catered only to medical patients.

This surge is reflected in weekly sales figures, with state dispensaries generating an additional $10 million in revenue each week, despite a slight drop in the average price per gram of flower, which fell from $9 to $8.58 by the end of August.

The launch of Ohio’s adult-use cannabis program also had a ripple effect on the state’s medical cannabis market, which saw a modest increase in sales of about $10,000 per week.

Since the launch of the medical cannabis program in January 2019, total sales have surpassed $1.9 billion.

Dispensary Limitations and Statewide Licensing Caps

Despite the excitement surrounding the adult-use cannabis market, Ohio regulators are carefully controlling its expansion.

The DCC recently approved 121 new applications for cannabis retailers, but more than a third of those licenses exclude locations in Ohio’s three largest counties: Franklin (Columbus), Cuyahoga (Cleveland), and Hamilton (Cincinnati). The DCC estimated that these regions already had sufficient retail coverage.

The state currently has 123 medical cannabis dispensaries, which began adult-use sales in August.

Under Ohio’s “10(B) license” program, growers and retailers already holding licenses can apply for permission to open additional stores.

However, the number of dispensaries in large metropolitan areas remains capped to avoid market saturation.

Ohio’s Strict Marketing Rules

Ohio’s regulatory framework extends beyond licensing and includes strict rules on marketing and advertising.

All cannabis marketing materials must be approved by the state before being distributed, and the penalties for noncompliance are steep. Several businesses have been fined for violating advertising rules since the launch of the adult-use program.

For example, Greenleaf Apothecaries, operating under the name The Botanist, was fined $150,000 for displaying signs exceeding the size limits imposed by the state and for hosting an ice cream vendor at one of its dispensaries.

The Botanist had not submitted its marketing materials for state approval, which violated Ohio’s cannabis advertising regulations. This infraction added to previous fines totaling $12,500 for earlier marketing violations.

Another notable case involved Standard Farms, a medical cannabis processing company in Garfield Heights, which was fined $12,500 for sending an unauthorized email announcing its dual-use license for adult-use and medical cannabis sales. The company had not obtained prior DCC approval for the email’s content.

Ohio’s stringent oversight ensures that cannabis advertising complies with state laws, which prohibit promoting adult-use cannabis as having health benefits or therapeutic properties.

Companies like Bloom Medicinals and Green Thumb Industries have also been fined for similar violations, including displaying unauthorized billboards and sending marketing emails without prior state approval.

Missy Starr, vice president of marketing at Bloom Medicinals, emphasized the difficulty of navigating Ohio’s strict advertising rules, especially in the rapidly evolving cannabis market.

Despite these challenges, she stressed the importance of compliance, stating, “We’ve taken full responsibility for it.”

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(Featured image by Robert Conklin via Unsplash)

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