Known for its exciting nightlife, high-end services and unique experiences, Las Vegas, Nevada has marketed itself for years as a destination where the opportunities for fun are endless and where anything is possible. Now that recreational cannabis is well established, “Sin City” actually does have something for everyone.
The state of Nevada began to allow the sale of recreational cannabis on July 1, 2017. Recreational cannabis has brought an impressive increase in profits for dispensaries, but there is hope that the medical cannabis community will also reap benefits from these profits. Experts predict that as the cannabis industry will continue to strengthen cannabis regulations, from packaging to consumption lounges, and the future will only be brighter for Las Vegas.
Local residents and the estimated 40 million tourists who come to Las Vegas every year may now purchase cannabis, so long as they are 21 and older with identification. Of all the legal major cities, Las Vegas, Nevada might have the biggest opportunity to generate the greatest revenue due to its tourist statistics. “Vegas is a great avenue because we are a recreational city,” said Shanna Perry, Outreach Coordinator of the Las Vegas Medical Marijuana Association. In a city that is known for exorbitantly priced bottles of alcohol, hefty club entry covers, fine dining and extravagant shows, Perry said Las Vegas’ retail margins can be greater because people expect to spend more there. There is actually a market for 24k gold rolling papers and $500 ounces of flower. “That customer is really hard to find in Colorado; it’s even hard to find in L.A. But as this industry becomes more and more corporatized, those extra extravagancies that people do when they are talking about recreation in general, they are going to do in Vegas,” she said.
“From a business volume level, obviously business has gone up since recreational, which is good because nobody was making any money with medical,” said Armen Yemenidjian, co-founder and CEO of Essence Vegas Cannabis Dispensary. A patient in Nevada used to have to go through the DMV to get a medical cannabis card. And still, they must relinquish their concealed carry firearms permits and still pay the state fee of $50 plus doctors’ fees. “Those factors created a much more depressed medical marijuana program,” Yemenidjian added. But with the introduction of recreational sales, Yemenidjian has heard of anywhere between 10 to 40 percent increase in revenue among local dispensaries. Allowing anyone over the age of 21 to purchase cannabis in Nevada naturally raises numbers from a business standpoint. “Whenever you increase the amount of people that qualify for something, the numbers go up. That’s not just Las Vegas, it’s any market that goes rec sees a boost in sales,” said Yemenidjian.
“Whenever you increase the amount of people that qualify for something, the numbers go up. That’s not just Las Vegas, it’s any market that goes rec sees a boost in sales.”
From Profits to Patients
Staying true and supporting the medical cannabis patients is still important to Las Vegas dispensary owners. “Mixing medical and recreational together is just tough. We cherish and value our medical customers,” Yemenidjian stated. “We have separate dedicated lines just for [them]. We have an onsite registered nurse that will meet with any patient or recreational customer, free of charge.”
Perry believes sales will continue to grow, and she hopes that real patients will benefit. “Hopefully we can use that [profit from recreational sales tax] to offset the expense to our medical patients as we go forward,” she said. “We are not reinventing the wheel, it’s what every industry has done.”
Transitioning into a recreational market puts more spotlight on any city, so doing things the right way is important in order to set a right-minded example to other states.
Mapping the Future
One of the only cannabis dispensaries on the Strip, Yemenidjian’s dispensary, recently celebrated its two-year anniversary. To keep up with the growing industry on a national level, Yemenidjian and his partner have plans to expand into other states by 2019. “It’s a really interesting time in cannabis. There is a lot of activity. I think the rest of 2018 is going to be a wild ride for cannabis. I think you are going to see a lot of strategic things taking place,” he said.
The future of the Las Vegas cannabis industry is already showing signs of positive growth. “We have been able to spend the last few years making sure we could be the casinos of cannabis and we did. Now, hopefully other states will mimic what we are doing so we can set a national standard in the industry,” said Perry. “I see Las Vegas as being the product hub for advertising . . . products coming from other states and getting licensing deals in Las Vegas. I think that it’s very important in our industry to look at the nation at this point.”
One could say that the Las Vegas cannabis market was set up for success from the beginning, thanks to some of the city’s most prominent business owners who obtained the allotted number of licenses back in 2014. The city is not currently issuing licenses to any new dispensary owners, but this will be open for review in 2019, said Perry.
Yemenidjian doesn’t think that legal cannabis has people running for “Sin City” just yet. “People come to Vegas because it’s Vegas. I think we will see an increase in tourism once Las Vegas adopts the idea of smoking lounges and actual consumption of cannabis somewhere,” he said, “When we create experiences here that are surrounded by, not only the purchase of cannabis, but experiences surrounded by the consumption of cannabis, I think that will be a differentiator. And, if we do what we should do, and do the Vegas version of it, then I think it’s going to be incredible.”
And according to Yemenidjian, local municipalities are talking of passing a law to allow consumption sites where adults can enjoy their legal cannabis purchases. Smoking lounges may be the new wave of cannabis business ventures, and Yemenidjian is ready for it.
Staying true to the medical patients and practicing good business ethics not only will make or break this industry, but also creates a model for other states looking to turn rec to follow. If the Nevada cannabis industry follows suit and ends up being as eminent as its world famous casino industry, then we could see it one of the highest rollers in the trade.