Once thought to be “recession-proof,” the cannabis industry, like all others, is feeling the effects of inflation, though industry executives remain “bullish,” according to the new “State of the Cannabis Industry: An Inside Look” report from cannabis staffing platform Vangst.
For the white paper, Vangst asked business leaders to forecast their sales, capital spending, and hiring over the next 12 months and then asked them about the current state of the national and cannabis economies.
Among the results, nearly 70% of executives expect sales to increase in 2023, while 67% expect to hire. In addition, more than 58% expect to increase capital spending, all higher than the responses of executives in traditional businesses. However, 76.2% of cannabis execs felt conditions in the cannabis economy were worse than they were in 2021.
Regulation and compliance continue to be the top challenges in the industry, according to the report, but inflation has moved ahead of federal prohibition and into second place. In the traditional economy, labor shortage and supply chain issues take the top two challenge spots, with inflation third.
“The cannabis industry has proven itself resilient from Day 1 of legalization; and the challenge the sector now faces is a true stress test, with businesses having to get creative with their business strategies as they navigate these uncertain times,” read the report’s introduction.
— Brian Beckley