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Pre-Rolls Growing Dominance in Emerging Cannabis Markets

21 July 2023 / Category: Blog
Pre-Rolls Growing Dominance in Emerging Cannabis Markets

Pre-rolls in the cannabis industry have experienced remarkable growth in established markets, leading to their immense popularity in recent years. This trend is expected to continue and expand into emerging cannabis markets.

When legal cannabis markets first emerged, pre-rolls were often viewed as a low-quality product, primarily used for trim and shake. However, as markets matured, the perception of pre-rolls shifted, leading to an increase in their popularity. Let’s take a closer look at the sales data to understand this trend.

What are Pre-rolls in the Cannabis Market?

Pre-rolls (aka pre-rolled joints) are ready-to-use cannabis cigarettes that have been professionally rolled and filled with ground cannabis flowers. They offer convenience to consumers by eliminating the need for manual rolling or assembling of the joint. Pre-rolls have become a favored option for both recreational and medicinal cannabis users due to their ease of use and consistent dosage.

How do Pre-rolls in the Cannabis Market Work?

Pre-rolls are created by using specialized machinery that automates the process of grinding the cannabis flower, sifting out undesirable particles, and filling the ground material into rolling papers or cones. The production process involves the following steps:

Grinding: The cannabis flower is finely ground to achieve a consistent particle size without damaging the trichomes, which contain the plant’s essential oils and cannabinoids.

Sifting: The ground cannabis material is sifted to ensure a uniform particle size and remove any particles that could affect the quality of the pre-roll.

Filling: A pre-roll filling machine is used to pack the sifted cannabis into rolling papers or cones, creating the finished pre-rolls. This machine simplifies and accelerates the production process.

The automation of pre-roll production has significantly contributed to their popularity by increasing efficiency, reducing labor costs, and ensuring consistent quality across a large volume of pre-rolls.

Pre-roll prices in Michigan surged when the recreational market opened at the end of 2019. Over time, as the market matured, the prices of pre-rolls declined, leading to increased sales. Moreover, as the prices dropped, infused pre-rolls gained traction and captured a larger share of the pre-roll market. These findings are not limited to Michigan alone but can be observed across multiple states such as Arizona, California, Colorado, Massachusetts, Nevada, Oregon, and Washington. The common theme is a decline in pre-roll prices, leading to increased sales and a rise in the popularity of infused pre-rolls.

Factors Driving the Growth of Pre-Rolls

The rapid growth of pre-rolls can be attributed to two significant factors: the declining price of flowers and advancements in pre-roll-making machinery.

Falling Flower Prices: The market price of the flower directly impacts the cost of pre-rolls. As the price of bulk flower decreases, the price gap between a gram of flower and a one-gram pre-roll narrows. This affordability factor makes pre-rolls more appealing to consumers.

Pre-Roll Making Machinery: Initially, producing pre-rolls was a labor-intensive process, hindering their affordability even if flower prices dropped. However, the introduction of advanced pre-roll-making machinery revolutionized the production process. With the help of automated pre-roll infusion machines, producers can create high-quality pre-rolls at a faster rate, significantly reducing labor costs. This automation has not only closed the price gap but has also facilitated the production of infused pre-rolls, making them more accessible to consumers.

Why Pre-Rolls Should be Considered Early On

While pre-rolls have witnessed significant growth, it is intriguing to note that their popularity often takes some time to gain momentum in emerging cannabis markets. This delay could be attributed to the priority given to other aspects of the business, such as cultivation, during the initial stages. However, with the emergence of multi-state operators (MSOs), experienced cannabis companies can enter new markets equipped with Standard Operating Procedures (SOPs) and the knowledge of efficient pre-roll production. As the industry evolves, it remains to be seen whether this trend of delayed popularity will continue.

How Much do Pre-rolls in the Cannabis Market Cost?

The cost of pre-rolls in the cannabis market can vary depending on factors such as the quality of the cannabis flower used, the brand reputation, and the market demand. However, the declining prices of pre-rolls have made them increasingly affordable for consumers.

Initially, when legal cannabis markets first emerged, pre-rolls were often of lower quality and came at a premium price. However, as markets matured and pre-roll production became more efficient, the prices of pre-rolls started to decline. Advances in pre-roll-making machinery played a significant role in reducing production costs and, consequently, the prices of pre-rolls.

Starting Pre-Roll Production: Simplified and Cost-Effective

One of the appealing aspects of pre-roll production is its simplicity and cost-effectiveness. Setting up a pre-roll manufacturing operation does not require a large production facility, and material can be sourced from other farms. The initial investment can be as low as $5,000, allowing entrepreneurs to acquire the necessary tabletop pre-roll-making machines.

The key machines to invest in are a grinder, a sifter, and a pre-roll filling machine. A high-quality grinder ensures a consistent particle size without damaging the trichomes, while a sifter removes particles that could potentially harm the pre-rolls. Finally, a pre-roll filling machine simplifies the process of filling pre-rolls. By starting with this basic setup, a single employee can produce hundreds of pre-rolls per shift. The production capacity can be easily scaled up by adding more equipment and employees.

Embrace the Pre-Roll Surge in Emerging Cannabis Markets

Considering the remarkable growth and market share occupied by pre-rolls, entrepreneurs entering emerging cannabis markets should seriously consider venturing into pre-roll production. The data supports the notion that pre-rolls are more than just a temporary trend. With the right machinery and a focused approach, businesses can capitalize on the rising popularity of pre-rolls and position themselves for success in the evolving cannabis industry.

Pre-rolls have witnessed a significant rise in popularity, both in established and emerging cannabis markets. The decline in prices, coupled with advancements in pre-roll-making machinery, has contributed to their growth. Entrepreneurs entering the cannabis industry should take note of this trend and consider pre-roll production as a viable business opportunity. By investing in the necessary equipment and embracing the pre-roll surge, businesses can position themselves for success in the evolving cannabis market.

Please keep in mind that this content was published for informational purposes and is not intended to provide legal or medical advice.

Cover Cannabis employs agents with extensive experience in the cannabis industry, enabling them to navigate the numerous challenges involved in securing insurance for cannabis businesses. Their deep understanding of the field makes them exceptionally equipped to identify the perfect policy tailored to your specific requirements. For more information on cannabis insurance and how to insure your cannabis business, call (833) 819-5010 to speak with an experienced cannabis insurance agent today.