New Mexico Retail Shops Counting on Texas to Score Big

It pays to be neighbors with Texas. Go big, or go cross the border.

As New Mexico is poised to launch its adult-use marijuana market, retailers on the border between the two states are bracing themselves for the stampede of Texans who are likely to flood into small border communities to purchase cannabis.

Despite its comparatively modest population of 2.1 million, New Mexico’s recreational marijuana market is predicted to generate up to $125 million in yearly sales in 2022, rising to $400 million by 2025

With no consistent policy state to state, this kind of over-the-border sales boost is relatively common; and New Mexico is about to get swamped with retail customers–but the sales boom will probably be short-lived.

Serving The Texas Market

Cannabis businesses in eastern and southern New Mexico are banking on an influx of Texans to boost sales in a limited-time opportunity to generate tourism dollars. For Texans, New Mexico is a favorite tourism destination.

Groups of recreational marijuana merchants in important border cities, as well as at least one border cannabis producer, focused on serving the Texas market, are preparing for a boom in Texas cannabis customers.

The second-most populated state in the US has a fairly restricted medicinal marijuana program, with only 19,805 registered patients as of February.

To prepare, one large New Mexico marijuana company is increasing production, emphasizing opportunities for quick retail purchases, and focusing on digital marketing to entice Texans.

New Mexico is counting on Texas to be a key to its rapid growth.

New Mexico’s Limited Window Of Opportunity

Because the eastern part of New Mexico is very close to Texas, the expectation is for particularly strong demand from Texans in and around Clovis, New Mexico, which is close to the city of Lubbock, Texas, as well as in New Mexico’s Doña Ana County, which is home to the major city of Las Cruces and is directly adjacent to El Paso, Texas.

Many adult-use retail establishments are anticipated to spring up along the New Mexico-Texas border in places with very limited populations.

Cross-border sales to Texans, on the other hand, may be a one-time chance. Either Texas will legalize cannabis within the next five years, or it will be federally lawful. And this will impact the market dynamics in some of these border areas.

RELATED READING: Reluctant Arkansas State Officials Can No Longer Ignore Neighboring Cannabis Success Stories

Retail Sales In Border Towns

While this dramatic boost in sales is a golden opportunity for rural and smaller New Mexico border communities to tap into the Texan flood of cannabis consumers, once recreational marijuana is legalized in Texas, the tide may turn. Sales could wax and wane, leaving formerly booming border stores in dire straights.

Then again, maybe not.

Texans close to the New Mexico border may prefer to hop over to their neighbor state a few miles away rather than drive for several hours to reach an in-state dispensary. Without a federal policy in place that legalizes interstate commerce–or even allows it–the cross-border sales flows are destined to continue. And border communities of commerce will continue to thrive.

 


 

Border shops will not need to conduct much marketing to encourage Texans to cross the state line. The proximity to the border and access to a major thoroughfare will be the main lure for them. In a very short period, the shops that win out will be those that truly understand the customer–retailers that truly dial in the customer experience. New Mexico border retailers are counting on that to draw in Texan cannabis traffic.

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