A recent report from data provider BDSA found that big multistate operators dominate the dispensary shelves in mature markets – despite competition for local brands that have commanded local customer loyalty.
BDSA looked at the performance of the top five bestselling MSOs with vertically integrated operations (retail + wholesale brands), which includes:
- Cresco Labs (OTC: CRLBF)
- Curaleaf (OTC: CURLF)
- Shryne Group
- Green Thumb Industries (OTC: GTBIF)
- Verano (OTC: VRNOF)
The cannabis analytics firm reviewed data from each of the markets it monitors and found that MSOs hold a considerable share of total sales.
“In January-February 2023, BDSA Brand House data show that the five best-selling MSO brand houses made up a 19% share of total dollar sales across all BDSA-tracked markets, with the largest of these MSOs, Cresco Labs, bringing in 4% of dollar sales on its own,” the report noted. “To put things in context, Cresco Labs owns 10 of the 2,740 brands BDSA tracks across all markets.”
That’s 4% of market share with roughly 0.3% of the brands tracked by BDSA.
MSOs also performed well in emerging markets, because the companies had the access to capital and experience. New, smaller brands often run into the higher barriers of entry to new markets and aren’t able to compete as well.
This makes perfect sense. The larger MSOs have the legal expertise to navigate new programs that are often still being developed even as they launch. The MSOs also have the experience from having launched in numerous markets.
Mature markets, though, would seem to favor homegrown brands. But BDSA noted that across mature cannabis markets, the five best-selling MSO brand houses still made up 11% of dollar sales in January-February 2023.
That means that in general they lose some market share as the landscape matures. Still despite losing some of the advantages they enjoy in emerging markets, the best-selling MSO brand houses manage to hold onto a healthy level of sales in mature ones as well.