It’s LEGAL: What comes next for cannabis in Canada?

Cannabis is officially legal for adult recreational use in Canada, ending 95 years of prohibition. It truly is the start of a new era, and an incredibly exciting time for those of us that work in the cannabis industry. But there are still many questions that remain and “kinks” to be worked out.

Brick-And-Mortar Retail
As of today, there are very few retail stores you can walk into and purchase cannabis. BC has one. Ontario won’t have any until April. Alberta is the exception, with 17 stores opening to the public today, and the expectation that more than 250 will be operating province-wide by the end of the year. For most of Canada, though, the licensing process is only just beginning. It will be several years (at least) before the market hits a saturation point for dispensaries in most areas.

Online stores
Online sales are available in most provinces, but you’re going to be ordering from a government-controlled e-commerce store. The only exception is Manitoba, which will permit licensed storefronts to also sell online. The infrastructure it takes to operate a successful online store at the scale needed in any province will likely be shaky for the foreseeable future. Take Ontario, for example. It’s population of nearly 14 million people will have only the Ontario Cannabis Store (online) to order from. Let’s say that the legal population is 10 million. Of that, approximately 10% consume cannabis on a regular basis. That leaves you with 1 million people. From that group, maybe 20% would be interested in purchasing from an online retailer on a monthly basis (keep in mind, online is the only option in Ontario). That leaves you with 200,000 orders per month. That’s a tall order for any organization that’s starting from 0, and the Ontario government isn’t exactly known for having a “nimble” startup mentality. (BTW, did you ever think you’d be buying a bong from the government? Welcome to a brave new world here in Canada!)

Edibles and concentrates
Currently still illegal. The passing of C-64 which legalized adult use had language in it that laid out a plan to rollout the legalization of edibles and concentrates within a year. Whether that will happen is anyone’s guess.

The level of marketing restriction placed on Licensed Producers and retailers is extreme, and makes it difficult to promote their products in any traditional fashion. Packaging, for example, looks like brown paper bags with a small logo. This level of government control won’t last now that the multi-billion dollar cannabis industry has a cadre of legit lobbyists. Eventually, cannabis will be marketed with restrictions that mimic alcohol, although that will take years to play out. We do expect to see some easing within a year, however, potentially at the same time as the edibles and concentrates legislation is discussed.

Illegal stores
There are illegal brick-and-mortar retailers everywhere, particularly in Ontario and BC. Will the government try to shut them all down? Or offer a path to licensing? We’re not sure yet, although in most places the plan is for a total shutdown.

There is momentum coming from throughout the industry to offer pardons for offences that are no longer illegal, mostly non-violent possession offences. Trudeau seems to be interested in the idea, but that’s where it ends as of now. For most cannabis crusaders, this seems to be shaping up as the next big fight post-legalization.

Uncertainty at the U.S. borders remains a big issue for the thousands and thousands of workers in this legal industry. Nobody knows what will happen (or when) but the status quo won’t be able to stay that way for long.

Today is a big day, with cannabis finally becoming legalized in Canada. It’s the biggest step yet in the development of our industry, but it’s still just one step, and there’s plenty of walking left to do.

Relevant Links:

Alberta’s Online Cannabis Store

BC’s Online Cannabis Store

Ontario’s Online Cannabis Store

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