Recreational marijuana went 0-for-3 on legalization initiatives in the 2024 election. Businesses in the states that legalized the drug for recreational purposes in 2023 are still trying to get licenses. Although statistics show that marijuana is still popular, the industry as a whole is volatile, and it can be difficult for an organization to find its footing.
The obstacles are significant, but they are not impossible to overcome. Here’s a look at the state of the cannabis industry, how some organizations are navigating those difficulties, and the role data plays in helping them through it.
State of the industry
Although Minnesota approved recreational marijuana use in 2023, it did not open up its license application process until mid-February 2025. Lawmakers say they are committed to opening up cannabis businesses before the end of the calendar year. These kinds of hurdles are not uncommon in an industry that is illegal at the federal level and faces different regulations from state to state.
A survey from June 2024 reported that only 27% of cannabis operators in the United States were profitable, compared to 65% of all small businesses in the U.S. Among the reasons for this disparity is the heavy taxation faced by the cannabis industry. In some cases, cannabis companies have built up an overwhelming amount of debt. Because of marijuana’s status at the federal level, those companies can not turn to U.S. bankruptcy court for help. Another ominous sign for the industry comes from California, where it was recently reported that inactive and surrendered licenses for marijuana businesses outnumbered active ones.
A silver lining
It’s not all bad news. Some organizations are taking advantage of the popularity of cannabis-infused beverages. Michigan’s Cannabis Regulatory Agency reported a 31% increase in customer spending on infused liquids at its dispensaries from June 2023 to June 2024. In Illinois, THC-infused drinks brought in $2 billion in 2024.
Cannabis companies, recognizing the potential for growth in this area, have been creative in the ways they take advantage of these types of opportunities. Some have teamed up with beverage companies to help them through the complex process of blending cannabis oil with water.
Data’s role
The more informed organizations are, the better their chances of success. A reliable analytics solution can mean the difference between an inactive or surrendered license and being able to keep a business afloat. Even if a beverage is popular, where it can be sold depends on where the business is located. Some states allow cannabis-infused beverages to be sold only in dispensaries, while in other states they are allowed to be sold in liquor stores, convenience stores, or restaurants.
An analytics solution can help keep track of the many rules and regulations that are ever-changing in the cannabis industry. Other data can help inform what products are popular and where they are selling, allowing companies to focus their efforts on what works.
There are many indications that the decks are stacked against a small cannabis business. Not only are big companies better prepared to handle problems like debt, there is competition from illegal alternatives that some people still seek out. While a company can’t combat all of the potential issues, they can be prepared to make the best decisions possible with a flexible analytics solution that can be customized for their business.
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