05 Sep 2016

A Cannabis Canary in the Coal Mine

05 Sep 2016

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.

cannabis canary squaks about surplus supply
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.”

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