Key business trends in the cannabis industry as of 2024
Rapid Growth and Expansion
- The global cannabis market is expected to grow rapidly, from $57.18 billion in 2023 to $444.34 billion by 2030, at a CAGR of 34.03% .
- Cannabis sales in the U.S. are projected to reach almost $40 billion in 2024.
- Cannabis is expected to add $115.2 billion to the U.S. economy in 2024.
Increasing Legalization and Acceptance
- More U.S. states and countries around the world are legalizing cannabis for medical and recreational use.
- Marijuana use is becoming increasingly accepted in society, driving demand for cannabis products.
Consolidation and M&A Activity
- The cannabis industry is experiencing major consolidation, with larger companies acquiring smaller players.
- Mergers and acquisitions have slowed down due to macroeconomic factors and lack of access to capital.
Challenges with Regulation and Banking
- The complex and changing legal landscape across different states and countries poses challenges for cannabis companies.
- Cannabis companies in the U.S. still face difficulties accessing traditional banking services due to federal illegality.
Product Trends
- There is growing demand for cannabis-infused products like edibles, pre-rolls, and vapes.
- Consumers are becoming more sophisticated, leading to product segmentation at the retail level.
Economic Impacts
- Cannabis is generating higher tax revenue than alcohol in several U.S. states[3].
- However, falling prices and profit margin compression are putting pressure on cannabis brands and retailers.
In summary, the cannabis industry is experiencing rapid growth and expansion, driven by increasing legalization and acceptance, but also facing challenges around regulation, banking, and economic pressures. Companies are consolidating and adapting to changing consumer preferences.
Industry Sources
https://www.investopedia.com/biggest-challenges-for-the-cannabis-industry-in-2019-4583874
https://mjbizdaily.com/10-cannabis-industry-trends-to-watch-for-in-2023/
