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New York Cannabis Market Sizing Tips and Strategies

Because legal cannabis has the potential to attract higher cannabis sales, New York legalizing recreational cannabis was one of the biggest cannabis news pieces in 2021.

So, if you’re a cannabis company looking to expand in the state of New York and wondering how you can conduct New York cannabis market sizing research to infiltrate the market, this article is for you.

By the end of reading this article, you’ll have a better idea of how you can do your research and determine the size of the cannabis market in New York.

What are market size and market sizing?
Market size refers to the number of units of a product or service sold in a given period or the number of customers expected to buy or avail of the product or service.

Market sizing or estimation of the number of consumers of marijuana in New York aims to calculate that number and uses questions like:

●What is the legalized cannabis market size in New York?

●How many people in New York purchase medical cannabis each year?

There are two approaches you can use to estimate the number of your future cannabis customers in New York. These are the Top-Down and Bottom-Up Approaches.

How to estimate the size of your Cannabis market
Estimating the market using a top-down approach means obtaining an overall size of a market, then applying filters to break it down to a more close estimate of your specific market.

In other words, from the total number of New York residents to the total number of cannabis consumers in New York.

The bottom-up approach, on the other hand, is the exact opposite. It starts with the smallest number of customers, or units, then builds those numbers up to get a clearer picture of the market size.

Top-Down Approach
The framework for the top-down approach would look like this:
●New York population
●The estimated percentage of the population who consumes cannabis
●The estimated percentage of the population who consumes medical marijuana and recreational marijuana
●The estimated amount of cannabis consumption in a year
●The estimated cost of the cannabis product

Multiply all the figures to determine the market size.

Bottom-Up Approach
In a bottom-up approach, you start with:
●The individual user
●The amount of cannabis product consumed in a year
●The estimated cost of the cannabis product
●The annual cannabis spend of an individual
●The number of individuals that regularly purchase cannabis

Multiply all the figures to determine the market size.

Both approaches can lead to a reasonably realistic answer.

A top-down approach to market sizing may be easier in some cases. A bottom-up technique may also be easier for some cannabis sectors. You’ll have to choose which method and framework to utilize and go with the one that’s most straightforward for you.

Market Sizing Tips

●Before making any market sizing calculations, decide on the approach first. Whether you use a top-down or bottom-up market sizing model, be sure to define it according to the geographical scope you want to cover, which is New York in this case.

●To get more specific figures, segment your population by their demographic characteristics. Age is the most common way to divide a group. You can split your population into age groups or generations such as Baby Boomers, Gen X, and Gen Y or Millennials

Segmentation is based on the premise that each section has distinct cannabis purchasing behaviors or motivations.

●To make math easier, use round numbers. Use 19.5 million instead of 19,415,392, the estimated New York State 2022 population.

●Use a separate sheet of paper for calculations. Your method or framework should be on one page of paper, and your computations should be on another. This ensures that you’ll be able to refer back to your framework at any time. This also helps to keep your computations tidy.

Opening a Cannabis Business in New York

Here are other important details that you’ll want to know if you’re going to launch a cannabis business in the state.

●The bill to legalize recreational cannabis, which was signed into law by Gov. Andrew M. Cuomo, allows for adults 21 and older to possess up to 3 ounces of cannabis or 24 grams of concentrated cannabis, such as oils derived from a cannabis plant.

●Those who have been convicted of marijuana-related offenses will have their records expunged as well.

●People will be allowed to keep up to five pounds of cannabis at home, but they must keep it in a secure location.

●Possessing more than the allowed amount of cannabis or selling it without a license carries penalties ranging from a minor infraction to a crime.

●To secure a business license to sell cannabis in New York, visit the Office of Cannabis Management.

Business licenses for adult-use cannabis include Adult-use Cultivator, Adult-use Nursery, Adult-use Processor, Adult-use Distributor, Adult-use Cooperative, Adult-use Microbusiness, Adult-use Retail Dispensary, Adult-use On-site Consumption, Adult-use Delivery, Registered Organization Adult-use Cultivator Processor Distributor Retail Dispensary, and Registered Organization Adult-use Cultivator Processor Distributor.

●The number of recreational cannabis business licenses to be issued in New York has yet to be determined.

However, the goal is for 50% of licenses to go to social and economic justice applicants, minority- and women-owned businesses, handicapped veterans, and distressed farmers.

Loans and grants are also available for these groups.

●The cost of a business license is yet to be determined but it is likely to be non-refundable. The fee will also depend on the kind of license you’re applying for, your product volume, and other factors.

●The retail sales of recreational cannabis in New York are expected to begin this 2022.

Need help with your New York Cannabis market sizing project?
If you’re ready to open new retail locations in New York and you need help with market sizing research, we’re here to help.

We are a full-service market research company and we aim to deliver the right insights to help brands make better decisions.

Interviewing Service of America is one of the most trusted names in market research. With over 40 years of experience providing a reliable source of business information and data for companies worldwide, we can help you understand the cannabis competitive landscape and target your prospects more effectively.

Get in touch with us today for New York cannabis market sizing research and all your cannabis marketing research needs.