TOP: In 2014, the Arizona Department of Health Services estimated medical marijuana sales generated $112 million in revenue.
(Cronkite News photo by Laura Monte)
BOTTOM: The Marijuana Companies leaders John Goreman and Howard Baer in their Scottsdale office.
(Cronkite News photo by Will Sowards)
Scottsdale company capitalizes on medical marijuana industry
Cronkite News
SCOTTSDALE – Bud is a burgeoning business in Arizona. Revenue from medical marijuana in Arizona more than tripled year-over-year in 2014, leading to a variety of individuals trying to find a fortune among the green.
The Marijuana Companies is just one of the businesses trying to capitalize on the growing industry.
“At some point, marijuana is going to be legalized, that’s just the trend that I see,” company spokesman John Gorman said.
Since the Scottsdale-based company went public in March, Gorman and the employees at The Marijuana Companies have worked hard to create what they call an online marijuana hub, a one-stop-shop for anything marijuana related, whether it’s finding a dispensary, a recipe or even a date.
Arizona voters in 2010 passed the Arizona Medical Marijuana Act, which allows people with certain medical conditions to use medical marijuana after obtaining a doctor’s recommendation.
In 2014, the department estimated marijuana sales generated $112 million in revenue, according to the Arizona Department of Health Services.
The industry will continue to grow as more people obtain medical-marijuana cards. Efforts to legalize marijuana have been generally unsuccessful in Arizona, though one state lawmaker is attempting legalize the drug and has introduced a bill to do so. However, it doesn’t have much support at the Legislature.
With so much cash at stake, companies have flocked to Arizona to cultivate and sell medical marijuana. But it also has opened up other opportunities.
For example, The Marijuana Companies Joint Lovers venture is a website designed to help marijuana users find love and friendship based on their mutual love for the drug. The company also offers marijuana-infused recipes at MarijuanaRecipes.com and recently purchased 420 Careers, an online database for finding jobs in the marijuana industry.
The company offers more than 12,000 marijuana-related domain names for rent as well.
“I’m sure we will be a major hub,” said Howard Baer, founder of The Marijuana Companies. “It’s one thing to put a listing in a directory, but our clients can advertise on all of our sites, and they all link into each other.”
The company’s first product, Weed Depot, premiered in November and offers a service for both marijuana consumers and businesses nationwide. Similar to other national services like Leafly and WeedMaps, Weed Depot lists marijuana dispensaries near an individual in U.S. locations that allow it. The site also shows some of the services the dispensaries offer, including the strains of marijuana they carry and available food products.
The non-profit status of dispensaries in Arizona makes advertising and marketing extremely difficult here. This has given The Marijuana Companies an opportunity to help dispensaries reach their key demographics, company officials said.
Dispensaries have little reason to use general advertising, said Anthony Evans, a senior research fellow at the L. William Seidman Research Institute at the W. P. Carey School of Business at Arizona State University.
“All a dispensary can do at present is sell medical marijuana to qualifying patients, and (they) are not allowed to sell it to anybody else,” he said.
Since medical marijuana became legal in Arizona, only 60,000 people have obtained medical-marijuana cards, according to the Arizona Department of Health Services.
But Evans said the industry has strong growth potential based on studies he’s read showing marijuana’s popularity among Arizonans.
In 2014 alone, 85 dispensaries opened, according to the health department report.
Evans said the market will only increase if the state adds more medical conditions.
Medical marijuana by the numbers:
Dispensaries opened in 2014: 85
Registered dispensary agents: 1,506
Total number of active medical-marijuana cardholders: 63,417
Total amount of marijuana sold: 9.14 metric tons
Total estimated revenue: $112 million
Source: Arizona Department of Health Services Arizona Medical Marijuana Act End of Year Report for 2014
1 comment:
Prohibition results in a total lack of control. Colorado does not have a marijuana problem. Today (February 25, 2015) it was reported that 58% of Colorado voters continue to be happy with their decision to legalize and regulate marijuana like alcohol. Last year they collected close to 70 million dollars in medical and recreational taxes from legal, regulated marijuana. They plan to use this for their schools and to repair their failing infrastructure. Despite concerns before the passage of the initiative, not a single zombie has been seen piloting planes out of Denver’s airports nor are they seen driving their buses.
In Arizona our students receive the lowest per pupil funding in the entire country and mental health services for children are some of the poorest in the nation.
Arizona legislators and prosecutors advocate that we continue a broken and failed system that benefits only the Mexican drug cartels and those Right Wing Nut Jobs who Police for Profit from the citizens of our state. This approach to the “marijuana problem” has resulted in cheaper drugs, more potent drugs, and easier access for our children than when we began the War on Drugs but our politicians who are highly invested in private prisons have prospered. Under the current system marijuana became our number one cash crop, surpassing both wheat and corn combined. In 1937 Harry Anslinger (our first drug czar) testified before congress that 100,000 people had used marijuana just before the passage of the Marijuana Tax Act. Today it is estimated that 100,000,000 of our citizens, including our last three presidents have used it. Marijuana prohibition has resulted in a thousandfold increase in its use. Still, Arizona politicians and those who Police for Profit try to spin this into a win in the War on Drugs. As taxpayers, we paid between 1 and 1.5 TRILLION dollars to have this done to us!
The Mexican drug cartels and the gang bangers that they hire to sell drugs settle their disputes with guns on our streets and in our neighborhoods every day in Arizona. They are estimated to run a 64 billion dollar annual drug business in the US. They currently make available black tar heroin, cocaine, and crystal meth to our kids and any seeking to purchase marijuana.
We are all better off to have marijuana sold in a local and legal retail market that asks for ID’s, sells only marijuana, pays taxes, and settle their disputes in our courts. A visible, local and legal company allows far more societal control than a hidden underground criminal enterprise with no government controls. The primary problems of concern of drug warriors with marijuana appear to occur with early adolescent use. These are the kinds of problems that regulation can improve when those who sell marijuana ask for ID's and do not sell to kids.
The Washington Post recently reported that farmers in the storied “Golden Triangle” region of Mexico’s Sinaloa state, which has produced the country’s most notorious gangsters and biggest marijuana harvests, say they are no longer planting the crop. The wholesale price has collapsed in the past five years, from $100 per kilogram to less than $25. It is clear that legalization and regulation is having a monetary impact on the drug cartels who are estimated to make 60% of their profits from marijuana.
Legalize and regulate in 2016! This is the right thing to do for the citizens of Arizona and especially for our children who may be seeking marijuana but instead are offered black tar heroin by cartel dealers.
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