Cannabis vendors say business is booming

The few licensed cannabis vendors operating on Long Island are discovering — and cashing in on — deep demand.

Strain Stars, the only recreational marijuana dispensary in the region, has an average of 1,100 daily customers, who spend an average of $100, according to estimates provided Wednesday by the state Office of Cannabis Management, which oversees the industry.

Strain Stars declined to share revenue figures due to what it said were safety concerns. But the shop's CEO and president, Yuvraj Singh, said East Farmingdale store's earnings are in line with industry standards, and that in its first month, Strain Stars paid between $400,000 and $500,000 in sales tax.

Dispensaries across the state conduct an average of $200,000 to $400,000 a week in sales, OCM Executive Director Christopher Alexander said at an East Islip forum focused on getting more towns to allow recreational pot shops. 

Thirty-five other businesses are licensed to open dispensaries in Nassau or Suffolk, but have yet to find locations. Most localities in the region prohibit pot shops, and zoning is relatively restrictive in communities that allow them. If the 35 other licensees launched, they would collectively make about $8 million to $16 million in revenue each week, Alexander said. 

"We know how many consumers are on the Island," Alexander said. "We know that we can bring similar businesses to towns and villages across the Island."

For 2½ weeks after Strain Stars opened, customers waited on line to enter the store, Singh said. The shop increased its staff from about 15 to 26 workers and was soon able to accommodate hundreds more customers a day, without lines forming. Part of this was due to employees getting used to the job and becoming more efficient, said Singh.

"We're just trying to make the flow of the store better however we can, whether it's changing around showcases, displays," said Singh, noting that he and his partners are drawing on their experience in the convenience-store sector.

"If you're not fast-paced, you're going to get left behind," he said. "Some call it chaotic, but if you know what you're doing, it's just fast-paced."

The Cannabis Place, a Queens-based pot delivery service, has also had to increase its head count, said CEO Osbert Orduña, a Suffolk County resident. The business launched in mid-May with about three employees, and now has 12. The company aims to hit 35, according to Orduña. 

Orduña said he couldn't disclose details about the number of customers ordering from The Cannabis Place or its sales or revenue under agreements the businesses made with investors. 

"We've posted positions for assistant managers, budtenders and mobile budtenders," he said, noting "that's the best indicator" he can provide on how his firm is faring. 

Legacy Dispensers, a delivery firm headquartered in Albany, has seen the volume of orders on Long Island decline, but sales are still strong, CEO Matt Robinson said. In early May, Legacy Dispensers' team made the first official recreational pot sale on the Island. The firm delivers orders in Nassau and Suffolk on Tuesdays and Saturdays.

"The first two months were insane," Robinson said, noting that Legacy Dispensers initially had 30 to 50 orders in the region each Saturday and now has about 20 to 30. "It's still good."

Robinson, who owns a construction company, said margins are relatively tight in the cannabis industry because businesses can't deduct most expenses from their income on federal tax forms. 

"That's like perfection, when you see a 10% profit," Robinson said, adding that he expects to earn more once he's able to open a brick-and-mortar location upstate. "You don't see a lot of money, not until you're doing a lot of numbers."

By Sarina Trangle

sarina.trangle@newsday.com@SarinaTrangle

Sarina Trangle covers affordability and cost of living issues and other business topics. She previously worked as an editor and reporter at amNewYork.