At the end of the first month of adult-use sales in Illinois, cannabis companies are pursuing additional dispensaries as a way to expand product availability.
The midwestern state’s cannabis market is poised to offer a competitive runway for all public players, given the high demand from consumers and the restrictions in place for opening stores.
On Thursday (January 30), Illinois-based Green Thumb Industries (GTI) (CSE:GTII,OTCQX:GTBIF) confirmed its expansion plans will continue with the opening of its seventh dispensary in its home state. The store, under the banner name Rise, will be located in the city of Quincy and will open this Friday (January 31).
This represents the second adult-use only store in the portfolio of dispensaries owned by GTI. The Quincy store obtained its license for recreational sales on January 13, according to the Illinois Department of Financial and Professional Regulation (IDFPR), the state agency tasked with overseeing dispensaries in the state.
On Wednesday (January 20), Jushi Holdings (CSE:JUSH,OTCQX:JUSHF), a public multi-state operator that is a relative newcomer to the space, told its investors it has secured a majority ownership stake in two existing dispensaries in Illinois. This market entry for Jushi is driven by these stores.
One of the stores, located in Sauget, has already been approved by the IDFPR to sell adult-use products. The second store is eligible to pursue this approval, but has not done so yet. According to Jushi, both stores, per state dispensary regulations, are allowed to seek the opening of an additional location.
Jim Cacioppo, chairman and CEO of Jushi, described the state market as “attractive, competitive and limited license.”
Cresco Labs (CSE:CL,OTCQX:CRLBF), a fellow Illinois-based operator with one of the largest presences in the state, has indicated it plans to open what it calls high-profile locations of its Sunnyside dispensary stores in Chicago, including one near Wrigley Field, home of the Chicago Cubs.
As the state has faced supply difficulties due to high demand from its consumer base, it is expected that the number of stores will continue going up to alleviate the pressure.
Amid all the potential future stores, Columbia Care (NEO:CCHW,OTCQX:CCHWF) has indicated it plans to open a second store in Chicago “later this year.”
The volume seen by the introduction of recreational sales has been a boon for these operators, who have confirmed rising interest.
Nicholas Vita, CEO of Columbia Care, said Illinois is “going to be a terrific performer” moving forward. Earlier in the month, the company told investors it had seen a 260 percent increase in transactions for its Chicago dispensary, or more significantly a 100 percent increase of revenue for this location, compared to its December 2019 daily averages before the launch of adult-use sales.
During a public question and answer thread on Reddit, Adam Bierman, CEO of MedMen Enterprises (CSE:MMEN,OTCQX:MMNFF), said its dispensary in Chicago now sees 200 transactions per hour thanks to the addition of recreational sales.
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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.