The legalization of recreational marijuana in Ohio is expected to drive additional demand for cannabis products, creating opportunity and stress alike for Northeast Ohio dispensaries. In the months and years ahead, local owners expect to hire more staff, expand their inventories, and increase production capacity.
Educating consumers will be another key aspect of the coming change, noted Amber Miller, regional manager of Shangri-La Dispensary, a Missouri-based medical cannabis company that opened a dispensary in Cleveland’s St. Clair-Superior neighborhood late last year.
“I’ve been in the Ohio market since 2019, and I’ve seen it go through its initial growth phase,” said Miller. “Once we get to adult use, we’ll have to retrain our patients. Get the education back out there to an adult-use market that’s not been privy to it.”
Last November, voters approved a measure allowing recreational cannabis, making Ohio the 24th state to allow adult marijuana use for non-medical purposes. Among the positives of legal and regulated use is the potential detrimental impact on the black market, supporters said.
“We know that this product does well for our health, but now you’re giving access where your average patient isn’t going off-market,” Miller said. “We can trust that buying from one of our establishments is getting people quality, tested products.”
Shangri-La, which serves about 60-70 patients daily at its Cleveland location, is already seeing a drop in medical customers since the November vote. A short-term decrease is to be expected as consumers weigh the benefits of renewing their medical cards during what amounts to a limbo period, said Miller.
Days after the state’s GOP-controlled Senate advanced legislation to undo key provisions of the cannabis initiative – including delaying legalization for at least a year – the Senate then passed a revised bill that would allow adults to start buying marijuana from existing dispensaries in as soon as 90 days.
In the meantime, cannabis storefronts are gearing up for adult-use sales. Miller expects Shangri-La to eventually service up to 500-600 customers per day, an uptick that will require educating off-the-street consumers new to cannabis.
“Dispensaries are over-hiring, because we know in a few months we’re going to need more people” said Miller. “I’ve got a few management positions open now. When I’m hiring any staff or management, I’m trying to hire people with experience so, as we continue to grow in this market, I’ve got my core people down that can hit the ground running.”
Working in limbo
Ohio had about 175,000 registered medical marijuana patients as of November 2023, a figure that will rise in the coming years, said Lenny Berry, founder of the Ohio Cannabis Health and Business Summit, a resource hub for the rapidly developing medical cannabis and hemp industries.
Yet, the sale and purchase of recreational marijuana remains illegal until state regulators can license dispensaries. Berry’s annual summit, aimed at both the general public and cannabis professionals, can be part of a mass education effort in light of the new law, he said.
“We have millions of new patients with legalization - anyone 21 and over can go purchase the medicine at a dispensary with a driver’s license,” Berry said. “You will have people who’ve never experienced it who want to try it for the first time. My goal is to educate them so they understand cannabis and how it interacts with their body.”
Serving the burgeoning “canna-curious” population also means understanding the rules around opening a recreational dispensary – or including adult-use in an existing shop, said Berry. Owners must find jurisdictions that provide a 500-foot buffer between would-be cannabis businesses and “sensitive locations” such as schools and churches.
Current marijuana entrepreneurs should also be considering their inventory, particularly as state officials hammer out details of two competing bills introduced following the passage of Issue 2, said Berry.
For example, House Bill 86 – approved 28-2 in the Senate on December 6 – permits smoking, vaping and cannabis combustion within a private residence. (Another piece of marijuana legislation, House Bill 354, is awaiting a vote in the House of Representatives.)
With pre-roll marijuana “joints” one of the most popular products on the legal market, dispensary owners may consider adding new brands to their selection. Moreover, cannabis producers should be busy building out their grows, Berry said.
“Growers have not maximized their square footage, because they didn’t have a need to,” said Berry. “They can get an uptick in their grow scenarios to accommodate what the future is going to bring in terms of need.”
The work ahead
Expanded access will ideally keep Ohioans from spending their cannabis dollars in Michigan, which legalized recreational marijuana in 2018, said Kate Nelson, executive vice president of the Midwest and Northeast regions at Acreage Holdings, a medical marijuana company with dispensary locations in Northeast Ohio.
Nelson also emphasized the importance of education, as local dispensaries are currently fielding calls about use and purchasing rules. In studying similarly sized markets, Ohio should expect a 150%-200% surge in sales upon official legalization - a number that will tail off, even as increased inventory and new hires should remain in the forefront, she said.
“As we get close to adult-use sales, we’ll see an expansion of staffing and workforce, and an expansion of retail hours so dispensaries are open longer hours and during more days of the week,” Nelson said.
Robert Pease, Chief Executive Officer of the Euclid medical cannabis store Good River Wellness, said newbies and veteran consumers should expect a temporary rise in pricing, depending on how readily supply meets demand. While the industry in Ohio remains in its relative infancy, it must be nonetheless prepared for the forthcoming tsunami of new customers, said Pease.
“The goal is to provide an exceptional experience – that’s a combination of a well-curated product lineup and products at good prices,” Pease said. “Then there’s giving folks the right information to make good decisions. It’s pretty straightforward, but in a new market, it will take some work to get there.”
