The Numbers Don't Lie
Flower still dominates by volume — about 78% of consumers buy it. But the growth is elsewhere. Pre-rolls saw an 11.9% revenue increase between 2023 and 2024, making them the fastest-growing product category in cannabis retail.
In Canada, pre-rolls nearly overtook flower sales in 2024. They actually led sales from May through October. The US is following the same trajectory.
What's driving it? Convenience, premium options, and changing demographics. Millennials account for 45% of the $3 billion pre-roll market. Gen Z is the fastest-growing segment overall, up 11.3% year-over-year.
Category Breakdown
| Category | Market Share | Growth | Margin Potential |
|---|---|---|---|
| Flower | ~40% | Declining slowly | Low-Medium |
| Pre-Rolls | ~20% | +11.9% YoY | Medium-High |
| Vapes | ~25% | +5-8% YoY | High |
| Edibles | ~12% | Stable | Medium |
| Concentrates | ~8% | Niche growth | High |
Why Pre-Rolls Are Winning
The growth isn't random. Pre-rolls solve real problems for both consumers and retailers:
- Convenience: Ready to smoke. No grinding, no rolling, no accessories needed.
- Portion control: Single joints or multi-packs let consumers manage consumption.
- Premium positioning: Infused pre-rolls command higher prices and margins.
- Gift-friendly: Multi-packs and tins make easy gifts and impulse buys.
- Social format: Pass-around-friendly for group settings.
The infused segment is especially strong. According to Headset, "Connoisseur/Infused" pre-rolls now account for 42.3% of pre-roll sales in the US and 32.6% in Canada. Consumers are trading up.
The Millennial Factor
Millennials spent $103.9 million on pre-rolls in September 2024 alone — 45% of total category spending. This demographic is driving the premium/infused trend. They're willing to pay more for convenience and quality.
Vapes: The Margin Play
Vapes represent about 25% of dispensary sales and deliver some of the best margins in the store. The $5 billion US vape market grew 5-8% year-over-year in 2024.
Key trends in the vape segment:
- Pod systems: Outperforming older 510 cartridge formats.
- Live resin: Premium vapes with real terpenes command higher prices.
- Larger formats: 2g devices are gaining share over 0.5g and 1g.
- Blended extracts: Multi-extract vapes (diamonds + live resin) are the new premium tier.
What's Slowing Down
Flower isn't dying, but its share is declining. Consumers — especially younger ones — are shifting toward ready-to-use formats. The convenience gap is real.
Basic edibles are plateauing. The growth in edibles is concentrated in low-dose products (42% of consumers prefer 10mg or less) and beverages (+15% YoY). High-dose gummies are becoming commoditized.
Stocking Strategy
Based on the data, here's what smart dispensaries are doing:
- Expand pre-roll selection: Especially infused options and multi-packs.
- Stock premium vapes: Live resin, multi-extract, larger formats.
- Don't abandon flower: It's still 40% of sales. But allocate growth capital elsewhere.
- Watch low-dose: Beverages and microdose edibles are growing.
- Track demographics: Your customer base determines optimal mix.
The retailers winning right now aren't just stocking what sold last year. They're leaning into the categories with momentum — and that means pre-rolls and premium vapes.
