1st year a success for pot shops
In a challenging first year for Washington’s groundbreaking recreational marijuana industry, two booming Vancouver pot shops have come out on top, selling more product than any other retailers in the state.
This weekend marks the one-year anniversary for those stores. Main Street Marijuana, Vancouver’s first pot shop, celebrated its first birthday on Thursday, and New Vansterdam, which opened two days later, will reach that milestone come Saturday.
Together, the two stores have generated more than $20 million in sales in their first year, accounting for nearly 8 percent of the entire industry’s revenue statewide. In that time, they’ve also raised nearly $5 million in excise tax revenue.
But it hasn’t been easy, as the cash-only stores have weathered supply shortages, price gouging and competition from the black market along the way. Meanwhile, a burdensome three-tiered tax structure left many in the industry failing to make a profit.
At times, the struggles were enough to cause the two stores to close their doors for a day.
“Initially, the biggest challenge was just getting product on the shelves,” said Ramsey Hamide, Main Street’s owner. “There was a huge imbalance between the number of retailers and the demand from the general public with the excitement of legalization.”
Main Street’s first brief shutdown was in protest of the high prices growers were slapping on their products, Hamide said.
“We weren’t comfortable having to put $40-a-gram product on our shelves just to break even,” Hamide said.
The store closed again before Labor Day last year, as the supply again fell short of the demand. Once Main Street obtained a consistent supply, the store was finally able to lower its prices, and it didn’t take long for it to become a bustling business.
Today, New Vansterdam leads the state in gross sales for the year, moving more than $10.5 million worth of product. And Main Street has topped the list of Washington’s 161 pot shops in sales for the past four months.
June was Main Street’s best month yet, with more than $1.76 million in sales. Hamide anticipates eclipsing the $2 million mark for July.
“None of us were anticipating that it would take on this life of its own,” Hamide said. “But we knew that the potential existed if we were able to be responsive to the demands of the customer.”
The store started out with about 10 employees and only a couple strains of marijuana. Today, the staff has grown to three dozen, and the selection has expanded to more than 250 different products.
In a matter of months, Main Street has gone from operating six-hour days to 15-hour days. Hamide recently extended his store’s hours to 8 a.m. to 11 p.m. every day to meet the growing demand.
Now, the biggest challenge is dropping the price low enough to truly root out the black market, Hamide said.
“We’re getting close,” he said. “I think we’re going to continue to get so cheap that there won’t be a black market, because black market prices are going to be higher than the retail prices.”
In the next six months, Hamide sees Main Street’s selection possibly growing to nearly 500 different products as prices drop some 25 to 50 percent.
New Vansterdam has a similar story. The store opened with about a dozen strains selling for $30 a gram or more, said Shon-Lueiss Harris, New Vansterdam’s spokesman. Now, it has more than 300 different marijuana products, and the average price for a gram of flower has dropped to about $20. The cheapest flowers sell for $5 a gram.
“Nobody knew if marijuana as a retailer would be sustainable,” Harris said. “We’ve gotten to this point now where it is sustainable. It’s not a passing fad.”
After the hugely successful year, big things are in store for the two shops as their owners seek out opportunities to expand.
“I think you’ll see several more Main Street Marijuanas popping up on the Washington side of things and you’ll see it also on the Oregon side probably,” Hamide said. “We’re in talks for existing stores that are under-performing, where we could come in and bring our management style and our supplies.”
Main Street is also working on opening a gift shop across the street, where customers will be able to buy shirts and other store-themed memorabilia.
Meanwhile, New Vansterdam is close to wrapping up a massive remodel that has added more space to the sales floor and made the building more secure.
This spring, New Vansterdam planted roots in Oregon, opening a medical dispensary in Beaverton. Plans are also in the works to expand north along the Washington coastline, particularly in Forks, Harris said.
“We are definitely looking to grow,” he said. “We’ve had success. Now, we can actually grow from this.”
New Vansterdam is going all out to celebrate the one-year mark with a weekend-long birthday party. Throughout the weekend, the store will host a glassblower and representatives from Zoots, Rogue Raven Farms and Liberty Reach, three of the state’s biggest marijuana manufacturers.
– Justin Runquist