Will the Friendly Neighborhood Headshop Survive with Legal Marijuana?
“It’s a lot like going to Costco or Safeway to buy your bread and your beer now. Who wants to make the extra trip to the head shop when buying weed these days?” added Carfield
Through the end of September, Washington State has reported combined sales of legal recreational cannabis of over $486 Million dollars for 2016, far surpassing 2015’s total of $323 Million as reported by http://www.502data.com, a website that publishes sales data from the required Washington State traceability software used by all state-licensed cannabis companies.
The sales numbers are staggering and the growth in cannabis is undeniable. One would imagine that all these sales numbers must be carrying over to the local head shop owner as well. Head shops are typically small retail stores specializing in paraphernalia used for consumption of cannabis and tobacco. However, many head shops are experiencing the exact opposite trends with their sales and Jonathan Carfield, founder and CEO of AlderEgo Distribution agrees. A leading distributor of cannabis paraphernalia, based out of Tacoma, WA, AlderEgo has seen a dramatic shift in their sales.
“Two years ago, our core customers were area head shop owners, tobacco shops and small convenience stores that represented over 80% of our sales. Today, almost 90% of our sales come directly from legally state-licensed recreational marijuana shops or medical marijuana dispensaries,” according to Mr. Carfield.
He continues to explain, “Almost every legal recreational store has continued to increase their accessory and paraphernalia sections. Not only have our sales shifted, but the overall trends have changed as well. Operating in one of the few legal recreational states, we try to pay close attention to trends and consumer behavior. This industry moves at a highly rapid pace, so we’re always struggling to keep up and adapt to the market.”
Mr. Carfield also shared, “We used to be the largest distributor of well-known brands such as Grav Labs, Chameleon Glass, and KandyPens. But today’s new cannabis retailer doesn’t care much about high priced popular brands because their consumers are different and want more affordable options. More tourists and travelers, more older folks on a fixed income and just your average joe worker that buys a gram of weed before heading home are some of the new consumers.”
AlderEgo claims to have an advantage because not only does the company produce and distribute paraphernalia, but they also partner with state-licensed producers and processors, helping them distribute a collection of packaged weed, THC-infused vape cartridges and a collection of concentrates, often described as wax, shatter, distillates and more.
In Washington, the most successful retailers are joining forces and combining their purchasing power to leverage better buys from cannabis farmers and processors. In addition, they don’t want to sell someone else’s brand, they want to further build their own. Many stores today have their own brand of weed, concentrates and also want their own brand of paraphernalia.
Today, AlderEgo specializes in helping their retail clients design and produce their own brand of accessories, supplying over 75 different retailers with their own line of products. This type of combined buying power has enabled the company to offer incredibly affordable, yet high quality products for their retail customers today.
“We spend millions of dollars in China, so our established buying power and tight relationships with factories allow us to offer incredibly affordable prices, fast turnaround times, low minimum order requirements and unique customization options for our clients. We also consult them on what to buy and how to sell because the majority of our clients are primarily focused on buying and selling weed. Our sales data for both cannabis and accessory offerings help us and our clients become smarter buyers and sellers,” Carfield explained.
The company is starting to work with local head shops in states that are looking to legalize recreational weed by helping them develop their own local brand so that when legalization comes through town, they are prepared with an established brand that many recreational retail shops may wish to partner with.
“It makes good business sense to stay ahead of the curve and we’re seeing the future consolidation of head shops and cannabis retail stores in Washington. It’s a lot like going to Costco or Safeway to buy your bread and your beer now. Who needs to make that extra stop to the liquor store?” added Carfield.
About AlderEgo Distribution
Since 2014, AlderEgo Distribution has been a leading supplier of cannabis-related accessories and paraphernalia in the Pacific Northwest. Based out of Tacoma, Washington, the company was humbly founded out of a small convenience store and now continues to be one of the fastest-growing companies in the cannabis industry.
The company specializes in helping retailers, head shop owners and smoke shops develop their own brand of cannabis-related accessories. In addition, the company offers other private label options and promotional items for the legal cannabis industry and is the supplier to over 75 different retail cannabis brands today.
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