“You Will See Prices Come Down, But It Will Take Time”: Why Ohio Cannabis Has Room to Grow

Burn After Reading The 30-second intel for operators and investors ⏱ 0:30

Ohio cannabis sales hit $110.3 million in August 2026, up 19% year over year, and Standard Wellness CEO Jared Maloof sees room to reach $150 million a month, though he gives no timetable and expects wholesale prices to fall gradually.

• Operators: Retail pays back fastest, so Standard Wellness is prioritizing dispensaries, funded mostly from operations, with cultivation next. Labor and electricity are the main costs, and automation limits new hiring. Advertising limits make reaching shoppers harder in Ohio.
• Investors: Ohio sales are rising with stable pricing and margins, but average transaction sizes are shrinking. Financial strain across the industry slows new capacity, so Maloof expects price declines to arrive gradually. He expects smaller operators to fare well.
• Do now: Review your capital plan against the retail-first, cultivation-later sequence, and test how gradual wholesale price declines and smaller average transactions would affect your margins.

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When Ohio launched medical cannabis sales on Jan. 16, 2019, The Forest in Sandusky served one of the state’s first patients, putting Standard Wellness at the beginning of a regulated market that would eventually expand to adult-use consumers. Nearly eight years later, the company is drawing on its experience in cultivation, manufacturing, and dispensary operations to expand as more Ohioans enter licensed stores.

Founded in 2017, Standard Wellness has grown into a vertically integrated cannabis operator with businesses in Ohio, Missouri, and Utah, and affiliated operations in Maryland. In Ohio, the company grows and processes cannabis at its Gibsonburg facility and sells products through The Forest dispensary brand, giving it a presence across the state’s supply chain.

Ohio’s regulated cannabis sales reached $110.3 million in August 2026, up 19% from the previous year, but CEO Jared Maloof believes the market has considerable room to grow.

In an interview with IgniteIt, he discussed why Standard Wellness has prioritized retail expansion, how the company finances new investments, and what could determine the pace of competition in the years ahead.

Ohio Changes Its Cannabis Rules

The company’s expansion comes as Ohio implements Senate Bill 56, a broad revision of the state’s cannabis laws that was signed by Gov. Mike DeWine in December 2025. Most provisions took effect March 20, 2026, changing the rules for licensed cannabis businesses and restricting intoxicating hemp products that had been sold outside the dispensary system.

The law brought medical and adult-use cannabis under a combined framework, capped dispensaries at 400 statewide, and specified statutory THC limits of 35% for plant material and 70% for extracts, although the Division of Cannabis Control can raise the extract limits through rulemaking. The law also banned the manufacture and sale of intoxicating hemp products that had competed with regulated cannabis through convenience stores, vape shops, and other retail outlets.

Retail Expansion Comes First

For Standard Wellness, the decision to concentrate investment on dispensaries has largely come down to how quickly those businesses can generate a return. Maloof said retail generally offers a shorter path to recouping an investment than cultivation or manufacturing, making stores the company’s priority during the past two years.

“Typically, your shortest return comes from investing in retail dispensaries, and so for the better part of 2025 and 2026, we’ve focused our investment there,” he said.

The company plans to turn more attention to cultivation expansion late this year and into next year, with Maloof anticipating an overall investment mix of roughly 60% retail and 40% wholesale. Most of that growth is financed through operations, although the company has used borrowing selectively, including financing real estate purchases for recently acquired retail locations while paying for their build-outs with internally generated funds.

The planned cultivation expansion will also be funded through operations, while additional stores give the company more outlets for the products those facilities produce. That connection between retail and wholesale influences how Standard Wellness evaluates dispensary investments, whose value extends beyond the results of an individual location.

“Every retail outlet increases the strength of the organization and particularly increases the strength of the cultivation and manufacturing facilities,” Maloof said.

Balancing Product Selection And Operating Costs

Even with that incentive to sell its own products, Standard Wellness aims to source approximately 25% to 35% of its dispensary inventory from its cultivation and manufacturing operations, reserving most shelf space for other suppliers.

Maloof said the approach gives customers a broad selection, with a “significant amount of shelf space” available to competing products.

The company uses arm’s-length transfer pricing for merchandise supplied by its own facilities, which Maloof said produces retail margins similar to those on third-party products.

Beyond inventory costs, labor is the largest retail expense, making staffing and the way customers move through a store important considerations as the dispensary business grows.

Standard Wellness uses kiosks to accommodate shoppers who prefer to complete a transaction with limited assistance, while keeping dispensary staff available for those who want to discuss products.

At its cultivation and manufacturing facilities, where Maloof identified labor and electricity as the largest expenses, the company is using automation to limit the additional hiring needed for expansion.

Maloof said that approach involves moving existing employees into other roles rather than replacing them with equipment. As production grows, automation can reduce the amount of “headcount growth” the company would otherwise need, he said.

More Growth Before Prices Fall

Ohio’s rising sales have been accompanied by relatively stable pricing and margins over the past year, according to Maloof, although average transaction sizes have declined as the market matures. He attributes that trend partly to legal dispensaries attracting a broader range of consumers, including shoppers who spend less per visit as they move away from illicit sellers.

Maloof believes the state can eventually reach $150 million in monthly cannabis sales, with additional dispensaries helping more people discover and access the regulated market. He did not offer a timetable for reaching that level, and said Ohio’s advertising restrictions make it harder to reach prospective shoppers than in states such as Michigan and Missouri, where cannabis billboards are nearly ubiquitous.

“Not everybody knows that cannabis is legal in Ohio,” Maloof said.

The pace of cultivation investment will also help determine how the market develops, particularly as additional supply begins to put pressure on wholesale prices. Maloof expects smaller operators to fare well in Ohio, where financial strain across the broader cannabis industry has slowed the deployment of capital that might otherwise bring new capacity online more quickly.

That does not mean Ohio will avoid the price declines seen in other markets, but Maloof expects the adjustment to unfold more gradually as operators work within the limits of their balance sheets.

“You will see capacity expansion, you will see prices come down, but it will take time,” he said.

How operators navigate that transition and respond to changing state regulations will be among the issues discussed at IgniteIt’s Cannabis Capital & Policy Summit in Washington, D.C., on November 18. Join industry executives, investors, and policymakers for a closer look at the forces shaping the next phase of the U.S. cannabis market.