New research from the Missouri Department of Health and Senior Services revealed that 93% of cannabis-related purchases occurred in the regulated market. The study also found that price, potency and convenience were key factors that influenced consumer habits in the state.
Missouri’s recreational program began in 2022. Four years later, health officials aimed to study consumer behaviors and purchasing patterns among cannabis consumers. Because Missouri limits the number of dispensary licenses, officials also wanted to examine how ending these restrictions would impact the cannabis market overall.
The study was conducted by Cannabis Public Policy Consulting LLC (CPPC), a New York-based consulting firm. CPPC used data from 1,200 individuals who had consumed cannabis over the last 35 months. According to the study, state regulators will likely keep the license restrictions in place, with data pointing to a booming market that’s meeting the needs of consumers.
“Missouri’s success in capturing more than 90% of cannabis spending within the regulated market in just three years is a significant accomplishment,” CPPC Chief Executive Officer Mackenzie Slade said in a press release.
In May, two lawsuits were filed in the state alleging that a few cannabis companies breached Missouri’s antitrust laws. According to the lawsuit, it is alleged that shell companies were used by cannabis company Good Day Farms to control 61 dispensaries in Missouri. There are currently 224 dispensaries in the state. This has sparked concerns about control and overconcentration within the cannabis market. According to the report from CPPC, researchers noted that their findings do not explain diversity of ownership amongst license owners. License limits dictate the amount of dispensaries in a given area, but do not prevent the same groups from owning multiple licenses.
“As a result, while the findings provide insight into the competitive distribution of market activity, they should not be interpreted as evidence regarding the concentration or diversity of market ownership,” the report said.
The study also examined factors that influence illicit purchases. Lower prices were a common factor, with 62% of respondents saying illicit cannabis was cheaper than products at state-regulated dispensaries. Thirty-seven percent of participants cited convenience as their reason for avoiding dispensaries, while 23% said they preferred to support small businesses and other community members. Nineteen percent of respondents noted that access to preferred products influenced illicit purchases. Notably, 1 in 5 respondents said that they do not trust government regulation, while 11% of respondents believed that illicit products were safer than those available at dispensaries.
The report concluded by offering guidance and recommendations for monitoring the cannabis market in the future, along with conducting the study again at a later date.
