Vertically integrated cannabis retail chain Sacred Garden in New Mexico, a staple of the marijuana industry since its founding in 2010, is going under and will close its doors Sept. 21, according to media reports and a notice on the company website.
The New Mexico market has become too competitive for Sacred Garden’s model to work, Carla Padilla, the manager of the Sacred Garden dispensary in Las Cruces, told The Las Cruces Bulletin. The market’s size blew up after the legislature legalized recreational marijuana and adult-use sales launched in 2021, and some industry insiders had been expecting contraction.
“There’s just so much competition, the market is so overly saturated, that we’re just not making money,” Padilla told The Bulletin. She also predicted that Sacred Garden won’t be the only retailer to close up shop.
As of Sept. 3, New Mexico had approved 1,006 retail licenses, according to data from the state’s Regulation & Licensing Department.
Sacred Garden runs seven dispensaries scattered across New Mexico. In addition to its Las Cruces store, it operates two in Santa Fe, two in Albuquerque, one in Sunland Park, and another in Ruidoso. All will be closing, and the company is having a fire sale in the meantime, with all products at 50% off.
Nicole Fuchs, a spokeswoman with the Southwest Cannabis Trade Association, further told The Bulletin that the New Mexico market favors companies that are better-capitalized, in order to help them withstand the turbulent and competitive landscape.
“We are definitely seeing more than a handful of businesses struggling in the industry and looking at possible closure due to the vast amount of competition for cannabis retailers,” Fuchs told The Bulletin, adding that New Mexico has become “a system where it’s survival of the ones with the most money.”
Ben Lewinger of the New Mexico Cannabis Chamber of Commerce countered that while the landscape may have become more competitive in the past few years, there are still plenty of businesses that are “doing just fine.”
Sacred Garden also picked legal fights with state authorities over tax policy and alleged health code violations, which cost the company upwards of seven figures in legal fees and lost sales, The Bulletin reported. That may have contributed to the company’s downfall this year.
As of Sept. 3, New Mexico had approved 1,006 retail licenses. Read More