Denver has its famous “Green Mile” and Portland, Oregon has, on average, more than one cannabis retail shop per square mile, but the most competitive market in the entire country might just be in one of the least likely spots imaginable: Oklahoma City.
“From my own store front door right here, I’m going to count it out loud for you: one, two, three, four five, six, seven dispensaries,” says Hector X. Najar II, owner of the Herban Mother shop. “Seven dispensaries literally right outside my door.”
“The scene, from the patient’s perspective, I guess, is like the Wild, Wild West,” he adds. “You’ve got the freedom to pick and choose.”
“It’s cutthroat down here,” agrees Corbin Wyatt, CEO and founder of Peak Dispensaries, calling Oklahoma City a “buyer’s market,” adding, “The patients definitely do have their fair choice of where to go.”
And “fair choice” might be the understatement of the year. Patients in Oklahoma City’s wide-open medical marijuana market have almost 500 shops to choose from just in their city. With an estimated population of 649,021 and a total of 489 dispensary licenses issued in that city alone, that comes to one store for every 1,327 man, woman and child in the city.
“It seems like every street corner,” says Cassi Doolittle, co-owner of the Fireleaf chain of seven dispensaries in the Oklahoma City metro area. “It’s definitely a competitive market.”
But at the same time, according to statistics from the state, 195,604 patient licenses have been issued with another 10,000 still being processed. In a state with an estimated population of about 4 million, that comes to nearly 5% of the state population registered in the system.
Or as Wyatt puts it, “I could throw a dart and find somebody that has a license.”
With saturation like that, it’s easy to see why the rush is on in the Sooner State.
From Red to Green
Oklahomans approved medical marijuana by a margin of 57% to 43% in June 2018, making it the 30th state in the union to allow cannabis use to treat certain medical conditions. It is one of the deepest, reddest states to legalize.
The state began accepting applications for licenses about two months later, and the first shops opened that fall. It was the kind of classically conservative, free-market approach one might expect from a state where every county voted for the Republican presidential candidate in 2016.
The vote and subsequent decision by the state government to take the approach it did touched off a green rush not unlike the initial land run in 1889 that opened the territory to white settlers looking to claim a homestead. Settlers who entered the state before its official opening and hid in waiting for the opportunity to stake a claim were known as “Sooners,” giving Oklahoma its state nickname; those who waited for the official rush to begin were called “Boomers.”
Following the 2018 vote on medical marijuana, a whole new batch of modern Boomers began their own rush to stake a claim in one of the largest and fastest-growing markets of the modern era.
According to the Oklahoma Medical Marijuana Authority, the state processed 16,273 business applications from August 2018 to August 2019, approving more than 7,300 licenses (4,287 growers, 1,173 processors and 1,848 dispensaries). In the process, Oklahoma collected $20.5 million in application fee revenue from commercial businesses and another $15 million from the 259,000 patient applications. The state also collected $7,871,477 in tax revenue from cannabis in that time.
The Peak Dispensaries has six storefronts currently open and a total of nine expected to be operational by year’s end, all located in and around Oklahoma City. Wyatt, the company’s CEO, says that early rush into the cannabis space really was like the old days as hundreds of green rushers searched for real estate for their grows and shops.
“How many times in our lifetime can we get into an emerging market?” Wyatt says. “It’s an accessible emerging market, anyone can join the cannabis industry. I don’t have to be a computer scientist or engineer to get into this industry.”
Peak’s first shop, located in Oklahoma City’s Plaza District, opened in November 2018. Prior to that, he and his partners opened a CBD-only store in an Airstream trailer in the same plaza’s parking lot. When a space became available in the plaza itself, Wyatt and his partners jumped at it, starting what he says was the second legal cannabis franchise in the Midwest. But while his chain will soon include nine shops, Wyatt says each store is different because the company’s goal is not necessarily numbers.
“This isn’t ‘how many stores can we put on a map?’” he says. “This is ‘how many experiences can we build in the communities around us?’”
The Family Business
Fireleaf is also building a small chain of dispensaries in the area, with five located in the city and two more in the suburbs. Doolittle says Fireleaf is a family business, with herself, her brother and their father as the primary owners (as well as some additional partners). She says they have been watching the industry for a few years and as legislation began to work its way to voters, she and her family decided to jump in, visiting other legal states to learn what they could about opening a cannabis business.
“We knew that it was going to be an emerging industry,” she says.
They opened their first store in December 2018 and have spent 2019 building their brand and growing along with the state’s patient count and the competition. “Over time, on the business side, competition has increased.”
Doolittle says Fireleaf has spent its first year working to establish a footprint, as well as a customer base, with an eye on the future. The stores do not focus on any specific demographic, but instead try to be welcoming to all patients. She says the stores all have generally large footprints to give customers space, something she says also helps the chain stand out from the smaller, mom-and-pop dispensaries.
‘With $1.67 to our name’
Najar, who calls himself the “OG here in Oklahoma City,” has a more focused approach, concentrating on his single dispensary and a second, CBD-only store, even as the boom grows around him.
“I’m going to stay in my lane,” he says.
Najar says his store, Herban Mother, was the first brick-and-mortar cannabis dispensary in Oklahoma, though when it initially opened in October 2017, it too sold only CBD products as the state’s medical marijuana law had not yet been passed.
“We were the very first ones to come out publicly with ‘cannabis dispensary’ on our door and windows. … We made no qualms about who we were and what we were all about,” he says.
Najar and his wife, an esthetician, started Herban Mother as a natural skin care line that quickly expanded to carry CBD products, as well as hemp pre-rolls. Seeing the possibilities, the couple dumped all of their resources into a new storefront.
“That’s when we opened up out brick-and-mortar with $1.67 to our name. We literally put everything in hock,” he says. “Because of the overwhelming response we just knew it was going to take off.”
And take off it did. Najar opened a second shop in 2018 and after legalization, got a license and switched one of the stores to a medical marijuana dispensary on January 1, 2019. Today, both shops are thriving and Najar has plans to launch his CBD brand nationwide.
In a market as competitive as Oklahoma City, the key to success is differentiating your store from the myriad of others that surround it.
“It’s going to come down to marketing, it’s going to come down to customer service, it’s going to come down to knowledge, it’s going to come down to ‘do we make that customer feel welcome and safe?’” says Najar. “Because it is a cutthroat business. Let’s be real, this is a business and everybody’s gotta eat. We’ve got to pay our bills. It is what it is.”
For Herban Mother, that means a hard focus of the medical angle and an attempt to stay away from the types of cannabis stereotypes that often permeate the industry. He and his staff also do not use any slang terms to describe a product, focusing instead on the benefits. Herban Mother employees wear uniforms while in the store as a way to signify to his primary demographic — elderly patients and first-time cannabis users — that the products are intended to help.
“I’ve always had that position of medicinal. We don’t burn incense, we don’t have tie dye in our facility, we don’t play Bob Marley,” he says, though he says if that’s not the customer’s intention, he can certainly switch gears. “We can forego all the medical descriptions and benefits. If you want to get bent, I got it. But if you need medicine, I can help you.”
At Peak, Wyatt’s goal is to stand out by fitting in with the communities in which the stores are located. He says his company’s slogan is “Built for the 43,” a reference to the percentage of Oklahomans who voted against the medical marijuana initiative in 2018. It’s a reminder to focus on the patients that come in and to not assume anything about their intentions.
“The 57 that voted yes, they do know about the potential benefits,” he says, “but the 43 that voted no are still a little bit in the dark.”
Wyatt, whose pre-cannabis background is in marketing, describes the Peak chain as “concept stores” with a focus that reflects the neighborhood or community where it operates.
“When we build these stores we like to build them for the communities they’re in,” he says. “So they’re all very diverse and different.”
For example, the company’s most recent shop to open is the Peak Craft Dispensary, which he described as “combining a Sephora with an Apple Store.” It has a green, herbal theme and the primary design feature is a live moss wall, as well as glass-encased kitchens and grow rooms for customers to see the products being made. The store also has modern technology like iPads and new, pyramid-shaped display cases, but also offers classes on the weekend with growers and processors so patients and customers can learn more about the store, its products and cannabis in general.
“If we want this to be a serious industry … then we have to build experiences that show this can be like any other retail business,” he says. “This is an opportunity to show cannabis can be more than people thought it was.”
At Fireleaf, Doolittle says the chain has built its brand with a focus on “variety and quality” and says the company is constantly searching for new vendors and new products to keep things fresh. She also believes the open floor plans and more laid-back approach from the company’s budtenders help create a more pleasurable patient experience, which has helped the chain succeed in the crowded Oklahoma City market.
All three store owners are hopeful about the future and the potential for the industry, though they do see things slowing down and stabilizing in the next few years as the current number of stores seems unsustainable.
“We’re kind of reaching saturation,” Wyatt says. “It’s not only full, it is exceedingly bloated down here.”
Wyatt says the future for Peak is about expanding what the stores offer and keeping an eye on quality as the supply continues to catch up with the demand.
Doolittle sees a similar future, with the growth continuing, but slowing and a focus on quality and customer service making the difference.
Both also see their company footprints continuing to expand as the market matures.
“It takes passion to stay in this industry,” Doolittle says. “It’s an exciting time in Oklahoma.”