Has 4/20 Burned Out in Colorado? April Data Shows Drop in Pot Taxes.
Colorado dispensaries saw less sales-dollar volume in April than in March this year despite the 4/20 holiday.
Colorado is used to seeing marijuana sales tax dollars spike in April, thanks to the 4/20 holiday on April 20, but that wasn't the case this year, according to the Colorado Department of Revenue.
Sales tax data from the regulatory agency responsible for overseeing the state's Marijuana Enforcement Division shows that Colorado's 10 percent retail marijuana sales tax brought in slightly over $8.1 million statewide in April 2017, over $1 million more than the $6.94 million collected in April 2016 — but $2 million-plus less than what March brought in this year.
According to DOR data, March's retail marijuana sales tax collected over $10.1 million for the state, meaning over $100 million of retail marijuana products were sold that month. Although April's overall marijuana sales easily eclipsed $100 million after retail and medical marijuana figures are combined, retail sales brought in around $90.2 million in sales taxes.
Despite showing year-over-year growth and breaking the $100 million mark in overall marijuana sales for the eleventh consecutive month, April didn't raise the bar as it has in the past. In 2014, April recreational marijuana sales were 60 percent higher than those in January of that year, the first month recreational sales took place.
Still, the commercial marijuana industry is hardly in trouble: DOR data shows that Colorado's marijuana industry sold just shy of $492 million in product through the first four months of 2017, over $100 million more than the $388 million sold in the first four months of 2016.
Joel Milton, CEO of Baker, a customer engagement platform for dispensaries, says the declining price of flower, the biggest product category in dispensaries, and the popularity of relatively cheap pre-rolled joints on holidays likely contributed to 4/20's sales-dollar volume fizzling out this year.
"Pre-rolls have the largest spike in orders during the holiday and have the lowest price point as a category," he says. "Last year, the medical side saw pre-rolls become the most 'popular' product of 4/20. Unit sales went up 150 percent compared to an average day."
Although he doesn't see the overall number of sales transactions dropping anytime soon, Milton does think 4/20 in Denver is starting to lose its luster.
"Consumers have more options for 4/20. More states have recreational [marijuana] or relaxed laws, so [there's] less of a need to come to Colorado," he says. "Public use is still a big issue: Most of the bigger 4/20 consumption events are happening outside of Colorado, and there are no more High Times Cannabis Cups or events that draw thousands from out of state."
The last High Times Cannabis Cup in Denver was held at the Denver Mart in April 2015.
The High Times Cannabis Cup hasn't been to Denver since 2015, citing scheduling and venue conflicts as reasons for the departure. High Times Media, which has rights rights to the Cannabis Cup, was purchased earlier this year by Los Angeles-based investment firm Oreva Capital. The firm, which includes Damian Marley and Denver pot entrepreneurs Ean Seeb, Nicholas Kovacevich, Isaac Dietric and Kayvan Khalatbari, says it plans to have a larger presence in Denver going forward, but hasn't specified if that would include a Cannabis Cup.
Organizers of Denver's longest-running and most populated 4/20 event, the 420 Rally, were recently hit with a three-year ban by the City of Denver because of the amount of trash left in Civic Center Park the morning after the April 20 event as well as other violations. Event organizers are currently appealing the ban.
Even without rallies and gatherings, Milton expects Colorado's cannabis industry to flourish as more products become available. "We still think there is room for growth, especially as new products continue to pop up in the concentrate category, which is the fastest-growing product segment," he says.
According to marijuana sales tracking firm BDS Analytics, concentrates accounted for $1.8 million in medical and recreational sales on April 20, 2016. That's more than 65,000 grams of wax, shatter and other potent varieties – and a 132.4 percent rise in sales volume and a 189.4 percent rise in grams sold over April 20, 2015.
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