Since it first appeared in December 2019, the COVID-19 outbreak has affected countless of lives and businesses around the world. As the deadly virus spread at breath-taking pace across the globe, infecting almost every country on earth within 100 days, it forced governments to close borders, reduce movement, and enforce strict social distancing measures.
These strict measures are designed to slow the spread of the coronavirus and reduce the number of people infected by the outbreak. However, whilst this is working and many countries across Europe are taking control of the disease, it has also had a huge economic impact that will likely be felt for years to come.
These lockdown measures have forced businesses, restaurants, and cafes to close and there is not a single industry that has not been negatively impacted by their results in some form – and the cannabis business is no different.
The impact of lockdowns on businesses
Due to these strict lockdown measures being implemented, the world is almost certainly going to be facing a global recession. However, as the 2008 financial crisis showed, this is not always a negative impact for some businesses and industries and signs are encouraging the cannabis trade will be able to remain in a positive stage.
Following the 2008 recession, there was a clear shift in consumer attitudes as they shifted away from luxury brands and huge corporations and instead focused on supporting local and small businesses. Although it is impossible to predict how consumer attitudes will change following the COVID-19 pandemic, early signs are encouraging that this trend will be similar on this occasion too.
However, before we can begin to look at the effects that the recession might have on the industry, it is important to look at the current problems that the lockdown is causing. One of the most obvious, and most pressing issues, is the immediate closure of all non-essential shops. Almost overnight, businesses found themselves without a regular stream of consumers and sales. In the Netherlands, the day before the lockdown began smokers queued up outside coffee shops to stockpile up on cannabis supplies before they were forced to close.
The lockdown has had a wider impact on the industry too. Some of the biggest hemp, cannabis, and CBD events and conferences have been cancelled or postponed, including the International Cannabis Business Conference in Berlin and the CBD Show in London. However, it is not all negative and many businesses and organisers have used the lockdown to get creative.
In London, The High Club (THC) teamed up with Volteface and the London Canna Group to create the UK’s first virtual legalisation rally on 4/20. The usual rally which takes place at Hyde Park wasn’t able to go ahead this year, so the trio created the livestream event across Facebook, Instagram, and YouTube.
Changing consumer habits
Whilst this sudden panic buying of cannabis before the lockdown would certainly have had a positive impact on year-on-year sales, as the lockdown continues this would have pushed to a negative standpoint, and businesses will have had to adapt to changing consumer habits. One of the initial trends that experts are noticing is there appears to be an increase in cannabis consumers’ bulk buying their product in a single transaction.
Alongside the bulk buying from regular customers, there has also been a huge surge in demand for cannabis products in general. This surge has meant that demand for e-commerce cannabis providers has increased and many business owners and entrepreneurs are now launching their own online stores in response; helping them to combat the loss of profits from the lack of physical selling at traditional retail outlets.
This downturn in the economy has led to many people suddenly losing their jobs and facing anxiety about how they will be able to pay for their necessities such as rent, utilities, and groceries. You might, therefore, think that this would see people reduce non-essential items such as cannabis products, however, that is not necessarily the case and retailers are actually benefiting from what is commonly referred to as the ‘lipstick effect’.
This is an effect whereby consumers will still spend their money on small indulgences during difficult periods. When they are unable to buy the big, luxury items these small treats help to maintain some enjoyment during the darker periods and is the primary reason why many leisure venues are able to remain somewhat recession-proof.
As the lockdown continues, recreational cannabis users are combating the growing sense of isolation and anxiety that comes with it but indulging themselves. With consumer demand showing no signs of abating, retailers are adapting to these changing habits to take advantage. Alongside launching e-commerce abilities, cannabis retailers are getting increasingly inventive with their delivery options; offering direct delivery to houses or curbside pickup – ensuring they are able to maintain with the strict social distancing implementations.
What does the future have in store?
As the world slowly begins to adapt to what is being dubbed ‘the new normal’, it will mean the world will look vastly different to what it did just four months ago. It looks increasingly likely that some form of social distancing will, unfortunately, have to remain in place for many more months, until a vaccine is found, so the cannabis industry will have to adapt.
As cannabis consumers continue to adjust to this ‘new normal’, many are actually discovering the benefits and ease that purchasing cannabis products online can bring. Being able to shop for high-quality products from the comfort of your own home is likely going to become the go-to solution for many consumers.
Those brands which are providing innovative and creative solutions during these difficult times will likely be the ones that will thrive in the post-COVID-19 world. Here at Eurocones, our focus is on providing consumers with the very best in pre-rolled cones and cannabis accessories. Our young and passionate team are working to ensure our customers are able to enjoy our full product range throughout the coronavirus outbreak, and we are following strict social distancing measures to ensure that our staff and customers are safe.
Alongside consumers, we are helping retailers and professionals too. Our unique Knockbox 100 Filling Device is helping them to save hours of their time by filling 100 cones in under three minutes; allowing them to focus on growing their business and adapt to this new world.
The COVID-19 outbreak is a generation-defining moment in human history and is undoubtedly going to change the face of the earth as we know it. However, change is not necessarily a bad thing and after a period of decline in recent years, this could be the stimulus to reinvigorate the cannabis industry.