Fear and uncertainty are usually bad news for the economy. However, while no business is immune to economic decline, there are certain industries that tend to experience steady demand, even in a bear market.

Toiletries, groceries, alcohol, cosmetics, and funerals have performed well historically, even when disposable incomes fall and unemployment rises.

People will almost always need certain items beyond the basic necessities of food, water, and shelter. The demand for shampoo, toothpaste, detergent, soap, and other cleaning supplies barely loses steam. Toilet paper shortages have become iconic in an era that is rife with geopolitical unrest, pandemics, and bursting market bubbles. Hygiene is certainly not one of the first things to go when the economy hits a slump. The demand for products remains so steady, that people fear the prospect of ever running out and resort to stockpiling and hoarding.

The importance of hygiene and personal care is not simply a matter of preference—people may feel more pressure to maintain appearances in order to present the best versions of themselves when employment is uncertain. Job markets become more competitive as hiring tightens or layoffs occur, putting people out of work and into job seeking.

Cosmetics remain in demand for both work and play. The “lipstick effect” is an economic term used to describe the change in consumer purchasing patterns in a recession. It relates to the substitution effect: when discretionary incomes fall, people are less able to afford luxury items, and instead, purchase smaller luxuries to satiate a (perhaps heightened) hunger for an escape from the stress of economic turbulence.

People may also resort to alcohol and other substances to alter their moods. Similar to the lipstick effect, people will still drink, but many will opt for a less expensive brand of alcoholic beverage than the label they usually prefer.

“The only two things that are certain in life are death and taxes”

Consumer trends reveal that cannabis is quickly becoming the new alcohol, with an increasing number of people preferring marijuana over alcoholic beverages. The demand for marijuana is expected to remain steady, or even rise, during the recession.

Free Woman in White Long Sleeve Shirt Stock Photo

That said, dispensaries, growers, and retailers need to heed caution. Although the recession may be good news for certain businesses that sell staples, both short and long-term increases in crime are historically correlated in some areas to recessions. Financial struggle can cause people to make poor decisions, and certain socioeconomic shifts can breed disaffection and resentment towards businesses as well as society at large. 

Those that produce or sell cannabis-based products should consider implementing Cannabis Compliant Security Solutions in order to protect themselves from real physical and financial dangers. Businesses that thrive in times of crisis may become targets of criminals who are looking to rob a business of their products and resell them on the black market, or to steal their cash reserves. Any product that is available for sale legally is also likely bound to be available for sale by illegal means.

The risks run especially high for an industry that sells products with such high demand, while also being plagued with evolving legislation and treatments by the law. Businesses that operate in the cannabis industry should consult with experts on implementing plans and solutions. You can give Cannabis Compliant Security Solutions a call today.

Cannabis Compliant Security Solutions