With only around 83,000 citizens, Medford Oregon has an amazing number of legal pot dispensaries.
There are 17 Medford pot dispensaries, the most in all of Oregon. And of 600 cities in the United States with a population of over 50,000, Medford ranked #2 in the nation, being surpassed only by Missoula Montana, population 74,000, who has 18 pot dispensaries.
Eugene Oregon, population 171,000 including 24,000 students at the University of Oregon was fourth had 16 dispensaries, meanwhile, Portland, Oregon’s largest city with over 2 million population had just 14.
Oregon had 6 out of the top 30 places, making it perhaps the highest pot-smoking nation in the country.
The first Medford dispensary in Oregon actually opened in Gold Hill, Oregon, approximately 12 miles from Medford in 2014, known as Breese Botanicals.
Breese Botanicals started as a licensed medical marijuana dispensary, but in 2014, Measure 91 was officially voted into Oregon’s laws, allowing essentially anyone 21 and older allowed to possess up to 8 ounces of marijuana legally or up to 4 marijuana plants.
Measure 91 required the Oregon Liquor and Control Commission to regulate the operation of legal dispensaries within Oregon. So far, there are currently 660 dispensaries operating legally Oregon Liquor and Control Commission rules.
To gauge the amount of legal interest in pot smoking in Oregon, consider that Oregon has 660 dispensaries for 4.2 million people. Meanwhile, neighboring California has
878 legal dispensaries covering a population of around 39 million, roughly 10 times the size.
To establish that marijuana is not a Pacific Coast thing, note that Washington State has only around 110 retail licensed dispensaries for a population almost twice the size of Oregon.
So why so many dispensaries Medford Oregon?
Undoubtedly, as legal dispensaries popped up in Medford, a great many entrepreneurs simply jumped on the bandwagon and thought, “What a great idea.”
And in many ways, the entry fee in the forms of licensing was not too expensive. The licensing fee to start a cannabis retail store in Oregon is roughly $4,750 dollars.
The biggest barrier is proving you have the financial net worth to sustain the business, but it’s entirely possible to consolidate financial net worth with one or several partners. Around $400,000 is recommended.
How much profit can you expect from owning a legal pot dispensary?
Profits are estimated at between $50,000 per year to upwards of $1 million. It all depends upon your business savvy.
Clay Bearson, a Medford City Councilman and associated with one of the Medford legal pot retailers feels there are far too many dispensaries in Medford, and that in the long term, he feels there will be a shake-up of the local dispensaries in Medford.
He bases his opinion partly on the tax structure. Since selling marijuana, state-licensed facility or not is not recognized as a legal business by the Federal Government, that means that normal tax write-offs such as business insurance, depreciation, loan interest, rent expenses, employee benefits, etc. are not allowed by the IRS to pot dispensaries.
As Bearson says, “Dispensaries are an unsustainable model, and the vast majority of those getting into the industry don’t realize the tremendous tax burden that comes with the retail pot industry. “
Besides the inability to write off business expenses, perhaps the biggest burden for Medford dispensaries and those in the state is the 17 percent retail tax rate they have to pay to the state on each retail marijuana sale.
While medical marijuana buyers don’t have to pay the tax, retailers are required to collect the tax at the time of the sale.
While the price at a legal dispensary for an ounce of marijuana may be comparable whether someone buys marijuana off the street, or from a legal dispensary when you add the 17 percent tax, that adds up to be an extra $25 or so for a 1-ounce purchase, which dispensaries say actually discourages people from visiting their establishment.
Where will the future lead for Medford pot retailers ?
Judging from the evidence, it does seem likely that Medford’s pot dispensary business will shrink. perhaps by half. With the weaker ones falling by the wayside.
The only reason for optimism is the possibility that a second legal marijuana initiative will develop in the future lowering the legal age down to 18 from the current 21.
This would perhaps be the shot in the arm the crowded pot dispensary business needs to make more shops sustainable. And naturally, if the Federal Government decides to legalize marijuana use, then the available business deductions any business can take would also become available to Medford pot retailers as well.