“The price of pot is tumbling in Colorado,” reported a financial paper this week. I hope every business owner is paying attention to this cannabis canary in the coal mine: in less than a year, wholesale prices have been nearly cut in half.
Why? Growers are ramping up production and flooding the market regardless of demand. And the trend isn’t unique to Colorado. Wherever there’s a legal market for marijuana, prices have been dropping.
Since legal marijuana entered Washington in July 2014, prices have dropped from $25 to $30 per gram to about $10 a gram at the end of 2015. Prices plummeted in Washington as new retailers clog the market.
In short, everyone wants in, seems to be getting in, and the question arises: how do the original industry mavericks stay in? I’ll share some thoughts tomorrow, but leave you with this insight from Seth Godin:
“Marketing creates value, by combining stories, design and care. The product or service is produced in a way that makes engaging with the item better.
“Commodities are in the eye of the producer. If you don’t want to sell something that’s judged merely on price, then don’t.”