Cannabis Flower Pricing Tiers: What’s the Difference Really?

Cannabis is cannabis, right? Not quite. Suggesting that all cannabis is the same is like saying that all wine is the same — of course, you don’t have to be a sommelier to know that there is a difference between a $20 bottle and a $200 bottle. It’s no different with cannabis flower.

Visit any dispensary and one of the first things you’ll notice is the range of prices for different cultivars (marijuana strains). Why are some cultivars priced higher than others? Dispensary pricing tiers represent increasing levels of quality. 

Factors That Affect Cannabis Flower Pricing 

Marijuana prices vary from one state to another, and even from one dispensary to another. Dispensaries follow their own strategies to set prices of cannabis flower sold in their stores. Any number of different factors are at work behind these pricing strategies, and no two dispensaries may have the same “formula” for setting cannabis prices. 

To understand how different factors affect cannabis flower pricing, consider these four in particular: certification, cultivation process, brand name and genetics, and taxes. 

Certification

Organic, non-GMO, and farm-raised foods tend to be more expensive than their conventional counterparts for several reasons, but mostly because production and quality control processes are more stringent for these foods. The same applies to cannabis, specifically high-quality cultivars that are free of harmful pesticides and chemicals. Cannabis brands that seek to grow more potent, fragrant, or beneficial flowers without any added harmful chemicals usually have higher manufacturing costs, and therefore price their cannabis in a higher tier.

“Certification” may also refer to efforts by cannabis brands to give consumers more confidence in the origin or quality of the cannabis they are purchasing. For example, Happy Valley dispensaries in Massachusetts uses trackable codes on packaging so customers can get a certificate of authenticity from Medicinal Genomics on the origin, potency, and profile of a product before buying. 

Cultivation process

How cannabis is grown, trimmed, and packaged is another key pricing factor. First, consider that cannabis grows best in relatively humid and warm climates. Cannabis companies in states with sub-optimal growing climates must build and operate indoor cannabis growing labs to ensure year-round crop availability. Indoor growing requires extra equipment and incurs additional utility and labor costs than outdoor growing, all of which gets rolled into the final price you pay for a gram or ounce of indoor-grown cannabis flower

According to recent pricing benchmarks, the cost of indoor-grown cannabis is consistently between 1.5 and two times more expensive per pound than outdoor cannabis.

cannabis benchmarks us spot index 12 weeks 2019-2020
Source: Cannabis Benchmarks

However, there are benefits to growing cannabis indoors, and good reasons to buy higher-tier premium cannabis cultivated in this way. Indoor growers have more control over the elements that impact the flavor, aroma, and potency of the cannabis. For example, they can control the humidity and precisely manage watering and fertilization, and can even isolate specific wavelengths of light to give each cannabis plant the nourishment it needs to yield the highest-quality flowers. 

Indoor cultivation also requires more human labor, since large machine trimmers cannot be easily utilized to harvest cannabis flowers. Machine trimmers can strip terpenes and other cannabinoids from the flower; hand-trimming allows each flower to be packaged at peak quality, freshness, and potency.

The added production costs of growing, trimming, and packaging cannabis by hand mean higher prices in the dispensary, but the result is high-quality cannabis you can taste, see, smell, and feel.

Brand name and genetics

Some brand name cannabis products are more expensive based solely on their name being well-known, typically due to celebrity backing, a large Instagram following, or some other mark of popularity. However, this is more prevalent in the California, Washington, and Colorado markets as they have been established for longer and are more saturated.

Rare or exclusive cultivars that aren’t commonly available or even found at other dispensaries due to rarity of their genetics could also have a higher price point. 

Taxes

The legalization of cannabis in states like Colorado, California, and Massachusetts means consumers can finally enjoy cannabis the same way they enjoy fine food or an expensive glass of wine. Cannabis dispensaries help educate consumers, and their staff can help people find the right strain based on the taste, aroma, and the effects they are looking for. Unfortunately, the benefits that came with marijuana legalization were not without extra costs — specifically, taxes.

In the United States, companies in the cannabis industry are subject to federal tax rates between 30% and 70%. On top of that, states and cities can also levy taxes on cannabis providers. In Massachusetts, for example, adult use marijuana is subject to a state sales tax of 6.25%, a state excise tax of 10.75%, and a local option for municipalities up to 3%. 

Get the Best Price on High Quality Cannabis Flower

Top-shelf, premium cannabis is usually more expensive than lower tiers for some of the reasons discussed above, but you can save on premium cannabis by looking for specials and discounts in your area. Dispensaries may also offer rewards programs for medical patients. You can learn about new and upcoming specials by joining your local dispensary’s mailing list or by following them on social media.

Enter your email address at the bottom of this article to get exclusive cannabis deals and savings from Happy Valley delivered right to your inbox. Happy Valley is leading the charge to create a consistent, premium-quality cannabis experience for adults in Massachusetts

Stop by to speak to a Happy Valley Host about which cultivars best suit your needs.

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