With adult consumers continuously taking more interest in hemp products, it’s no surprise that
the combustible hemp category has recently reported consistent growth year over year. There
are no signs of that trend slowing down, especially as the desire for alternatives to combustible
tobacco has become increasingly widespread.
For example, the hemp segment of the wraps category saw 87.5 million wraps sold in the 52-
week period ending April 23, 2022, up 61% from the same period one year ago. The segment
also experienced a distribution increase of more than 8%, with nearly another 15,000 stores
receiving hemp wraps, or about 47,400 total stores.
And wraps aren’t the only category performing well. Volume growth for cones is up 20%, with
the hemp segment outperforming the category, up 29%.
This recent growth has been gaining steam for a while, and there’s no better case study of how
that momentum has affected the industry than with Hempire. When Swisher first launched
Hempire in 2017, our portfolio included just 11 different hemp rolling paper SKUs.
Fast forward to 2022 after years of due diligence and R&D, and we’ve expanded our product
line to include Hempire Wraps and Hempire Cones. Thanks to the significant increase in
demand from adult consumers – and synergy with legacy Swisher tobacco products – both
products have experienced immediate success.
Specifically, we have already sold over 30.4 million wraps since our July 2021 launch, which
accounts for 35% of all hemp wraps sold across the U.S. in that time period. Hempire Wraps are
in over 25,900 retail locations, which accounts for 55% of all stores receiving hemp wraps. And
just months after its recent release, we’re already seeing 11% of all retail locations that offer
cones carrying Hempire Cones.
In addition to this volume and sales growth, the hemp sector benefitted greatly from the
passing of the 2018 Farm Bill that legalized the regulated production of hemp. This bill was
instrumental in paving the way for the expansion and innovation of Hempire and other hemp
products. And while this momentum for the Hempire business and the hemp segment has been
exciting, the most promising part is that this is just the start.
As we head into the next stage of the segment’s growth, a few market factors exist that
dispensaries, manufacturers and others should pay close attention to as they are likely to
influence the overall expansion of the segment.
No. 1: Ongoing Changes to Tobacco Regulations
As tobacco regulations continue to evolve, the shift to herbals and other natural alternatives
has become more prevalent. As these policies change, so will the demand for products in the
hemp segment. Those who manufacture, distribute and sell these products should continue to
pay close attention to these regulations and be ready to capitalize on or respond to any
developments.
No. 2: Higher Margins on Hemp Products
The higher margins that hemp products generally offer, as compared to other combustible
products, is a big reason why this segment has increased its market share. In the years ahead,
manufacturers and suppliers alike should continue to find ways to capitalize on this opportunity
through product expansion and innovation to maximize sales, especially as adult consumers’
interest in herbals grows.
No. 3: Growing Acceptance of Herbals Nationwide
All the factors above have helped grow the acceptance of herbals across the country. This
increase in acceptance has led to a stronger understanding and awareness of the products
available across the hemp sector. We anticipate this trend will only continue in the years ahead
– and it represents a significant growth opportunity for hemp-based products to become widely
used nationwide in a short time period.
The past and projected future growth of the hemp segment is a promising trend for our
industry. In response, Hempire will continue to increase its presence across the U.S. and look
for opportunities to expand overseas when the time is right. By paying attention to the factors
above and developing an approach for product evolution and expansion, the hemp segment as
a whole is well positioned for national and global growth.
Source: MSAi Database as of 4/23/22. Data reflects volume through traditional outlets – 52
weeks ending 4/23/22.