In rise of U.S. vape shops, owners eye new marijuana market
By Jilian Mincer
NEW YORK (Reuters) - When Matt and Jen Osmun opened their vape shop in Bethel, Connecticut, last December, they didn't expect to get a boost from the local medical marijuana outlet.
"Sales are going really well, and getting better every month," said Jen Osmun, who started the business with her husband, a former plumber, after he was injured in an accident. Most customers at Grassy Plain Vape & Smoke buy electronic cigarettes to help them quit smoking tobacco, but a growing number are referred by medical marijuana commissaries in the neighborhood – the nearest is about five miles away.
The Osmuns' experience is becoming more common as the number of U.S. vape shops soars and shop owners seek to capitalize not only on the vaping trend, but on the more widespread, and legal, use of medical marijuana.
Since 2008, the number of U.S. vape shops has grown to about 8,500, and the sale of electronic cigarettes and supplies climbed to $3.5 billion, according to Wells Fargo Securities analyst Bonnie Herzog. She expects U.S. use of e-cigarettes and vaporizers to overtake combustible cigarettes in 10 years.
Marijuana represents an additional lucrative market. IBISWorld, a market research firm, projects sales of cannabis for medical use to increase to $13.4 billion in 2020 from $3.6 billion in 2015, largely due to demand from an aging population with conditions such as arthritis, Alzheimer’s disease and glaucoma.
GreenWave Advisors, an industry research firm, estimates marijuana sales could reach $35 billion in 2020 if all 50 states legalize marijuana for both medical and recreational uses.
Medical marijuana use is permitted in 23 states and the District of Columbia for a number of conditions, including cancer, multiple sclerosis, severe pain and HIV/AIDS, according to the Marijuana Policy Project. Another 15 states allow patients – often with severe seizure disorders - to use a few strains of cannabis for treatment. Recreational use is legal in Colorado, Washington, Oregon and Alaska.
At many vape shops, the new customers are typically older nonsmokers suffering from serious illness, according to vape shop owners, customers and industry experts. Continued...