Akerna Flash Report: Online Cannabis Orders and Delivery Dip as States Reopen
Delivery Rates in May are 50% Lower Than April High
DENVER, May 18, 2020 (GLOBE NEWSWIRE) -- Business intelligence from Akerna (Nasdaq: KERN), a leading compliance technology provider and developer of the cannabis industry’s first seed-to-sale enterprise resource planning (ERP) software technology (MJ Platform®) shows in the wake of many states reopening, online cannabis orders and pickup as a fulfillment method have started to decline.
“The number of delivery orders skyrocketed in March and April, but in May we’re seeing a shift back towards in person transactions. The average number of daily deliveries kept climbing through April but appears to be trending downward in the last two weeks, so we may have hit a peak,” said Aryeh Primus, vice president of analytics, Akerna. “We continue to see that the in-store interaction between consumer and budtender is key for people purchasing cannabis, and delivery takes away that.”
Looking at the numbers relative to January 2020, before anything was affected by COVID-19, March saw a 220% increase in daily deliveries and that ballooned to 710% in April. Beginning March 14, the number of in store purchases declined steadily, in some cases dropping by over half, presumably due to stay at home orders. Now that states are reopening, more people are going back to dispensaries.
“When we saw the increase in alternate modes of fulfillment, like delivery and curbside pickup, our initial thought was that this might be a sustainable trend because of increased consumer convenience,” said Primus. “There will likely be a long-term increase, but the April bump doesn’t seem sustainable; at least some of the shoppers want to return to in person transactions. May deliveries are about five times what we saw in January, but that’s a 50% reduction compared to the highs in April.”
Business intelligence from Akerna also shows, year-over-year, May 2019 to May 2020, recreational order sales are up 157% with an average ticket size of $77.73. The 30 – 40 age group had the strongest order sales growth at 103%. As the industry evolves to meet customer needs, product pickup as a fulfillment method increased 141% year-over-year, accounting for 16% of order sales for 2020.
**The Numbers, Year-over-Year, April 2020 compared to April 2019:
Total cannabis sales increased 68%, with an average ticket size of $123. Top categories:
- Concentrates increased 22%, accounting for 11% of total product sales
- Cartridges / Pens increased 3%, accounting for 35% of total product sales
- Infused Edibles decreased 18%, accounting for 9% of total product sales
- Flower maintained, accounting for 43% of total product sales
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Akerna is a global regulatory compliance technology company. Akerna’s service offerings include MJ Platform®, Leaf Data Systems®, and solo sciences tech platform. Since its establishment in 2010, Akerna has tracked more than $18 billion in cannabis sales. Akerna is based in Denver. For more information, please visit www.akerna.com and follow us on Twitter @AkernaCorp.
About The Akerna Flash Report
Flash Report is a look at buying trends in the cannabis market as captured by Akerna’s MJ Freeway subsidiary. MJ Freeway provides operators with MJ Platform, the industry-leading solution for regulatory compliance technology, from seed-to-sale-to-self. Some instances of the flash report may include business intelligence derived from Akerna’s family of companies, including Ample Organics, Leaf Data Systems, solo sciences, and Trellis.
**Data is derived from MJ Platform, the leading provider of cannabis compliance software for the marijuana industry. Reporting data is obtained from operators using Akerna’s MJ Platform solutions. Increases are relative to the prior period. Additional business intelligence data sources may include proprietary tools used by Akerna’s family of companies.
Certain statements made in this release are “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. Such forward-looking statements include but are not limited to statements regarding sustained increases in demand for cannabis and the ability of the MJ Platform team to help operators make decisions through analytics and reporting. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of significant known and unknown risks, uncertainties, assumptions, and other important factors, many of which are outside Akerna’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others that may affect actual results or outcomes, include (i) Akerna’s ability to maintain relationships with customers and suppliers and retain its management and key employees, (ii) changes in applicable laws or regulations, (iii) changes in the market place due to the coronavirus pandemic or other market factors, (iv) and other risks and uncertainties disclosed from time to time in Akerna’s filings with the U.S. Securities and Exchange Commission, including those under “Risk Factors” therein. You are cautioned not to place undue reliance on forward-looking statements. All information herein speaks only as of the date hereof, in the case of information about Akerna, or the date of such information, in the case of information from persons other than Akerna. Akerna undertakes no duty to update or revise the information contained herein. Forecasts and estimates regarding Akerna’s industry and end markets are based on sources believed to be reliable; however, there can be no assurance these forecasts and estimates will prove accurate in whole or in part.
Akerna Media Relations
D. Nikki Wheeler
Akerna Investor Relations
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Released May 18, 2020