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How are Ontario cannabis dispensaries expected to make a living with these ever-changing and constricting regulations?

Ontario dispensaries, especially in the GTA, are not being given a fair shake.

By Josh Socket Writes Published 3 years ago 7 min read
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Yerba Buena - 1669 Bayview Avenue | ERBN Green - 3244 Yonge Street | Hemisphere Cannabis Co. | 1703 Avenue Road

Welcome,

This week, I won’t be recommending any strains. This is the last time you will read the word terpene. I won’t be telling you what anything smells or taste like either. This article has no THC content. I will be talking about an issue effecting cannabis dispensaries and licensed producers alike.

The regulations surrounding cannabis dispensaries have been ever-changing during Covid-19. At times, specific sales options have been taken away from dispensaries. Meanwhile, similar convenciences remained available for The OCS as well as the illegal market. This prevented dispensaries from competing fairly.

At other times, dispensaries were not deemed essential, which meant they were not allowed foot traffic. Foot traffic for dispensary sales directly affect licensed producers. Dispensaries are a major source for consumers to learn about the plant and more importantly, to inquire about what's right for them. This is how many people discover brands in the cannabis space. Especially for new consumers.

Dispensaries are education hubs where consumers can safely ask questions. There is far too little information on the OCS site about the product. At the very least, the OCS cannot properly connect consumers without a personal touch. I think they need a virtual budtending system.

Imagine your grandmother looking to buy cannabis. You would want her to be able to go and ask questions right? I know I would.

Currently, dispensaries are only allowed delivery and click & collect. Meaning, customers cannot go into a store and ask questions. Which is incredibly inconvenient to cannabis customers. It’s much harder to have a proper conversation standing out in the cold in a Toronto winter. (As I edit this, it was -6 celsius today). This could lead to people having negative experiences because of a lack of guidance. Its easy for a first timer to become afraid of the product because they had a bad experience.

It also means licensed producers are losing opportunities to capture hearts and minds. When you can barely talk to a budtender (and budtenders have become quite knowledgeable) and you can’t even look around a store, it changes the buying process. Visual marketing inside stores is no longer. It's too cold to stand outside to buy weed. How does a new consumer know what to buy? What brands are good? What if I try the wrong thing and have a bad experience? It can be daunting. Especially when you’re not in the know. You know?

A Covid-19 Ontario Cannabis timeline

April ruling

July ruling

November ruling

My commentary:

At various points during the year, dispensaries have not been allowed to provide full services. They were forbidden delivery at a time when the Ontario Cannabis Store and the illegal market was both delivering.

With the current lockdown, customers are not allowed to enter dispensaries. You can still go to the LCBO, walk in and buy a bottle or can of something (Without any limits, but that's another conversation). Although some stores are offering curbside pick-up, delivery and click & collect.

Think about it, you don’t know how many people touched that before you. Even the staff have to touch the product to face it. In a dispensary, the number of people who handle the product is greatly reduced. Which is much safer. Why are dispensaries not offered allowed to be open?

When customers were allowed in stores (but delivery and click & collect were forbidden), stores were capable of maintaining Covid-19 compliance.

You would order your product from a budtender who was:

  • standing behind a partition
  • wears a mask while on the premises
  • regularly washing their hands
  • regularly cleaning their work stations
  • Maintain social distance

The budtender then orders the product from a person in a secured room. Less hands touch the product and less hands are given the opportunity to handle the product. There are minimal opportunities for the product to come in contact with people. I would argue its much safer. In a liquor store, anyone can touch product at any time. You don’t know who has Covid-19 and who doesn’t. And not everyone with it is willing to stay inside, or even know they have it

They proved they’d be able to comply and maintain best practises to keep people safe.

Meanwhile 2020 has still been a great year for cannabis sales in Ontario!

People are spending more time at home in isolation. They are turning to cannabis to ease the boredom, the stress, and the anxiety of Covid-19. In March, people began stock-piling weed. They knew they would be stuck inside for a long time.

During a global pandemic, the sale of Health Canada approved products in sealed packaging should be promoted in any form of sale. Imagine going to meet a dealer to purchase bud packed into a bag by hand now. Imagine your grandmother going to purchase her pot that way.

Each month this year, we’ve seen legal market sales rise. In July, Ontario saw a 15% from June. Which was the largest jump (between months) since legalization in October of 2018. When you could walk into a store and ask questions inside, the sales rose.

In August, the cannabis market nationally sold over $244 million dollars in product. By itself, Ontario burned through about $66.9 million dollars in legal weed. Nice. Ontario smoked 27% of Canada’s legal pot in August. Good job gang. These numbers could have been even larger for the entire year if consumers were provided the same options and conveniences year-round.

The industry is continuing to address consumer complaints in efforts to improve.

One of the major complaints about legal cannabis has been pricing. Earlier on in legalization, legal flower averaged at $10.25 per gram, while you could still buy illegal product for closer to $6.25 per gram for loose flower. Right now, the average price for legal flower is closer to $7.05 per gram, while illegal cannabis is closer to $8.00 per gram.

Legal products are roughly 68% cheaper than they were, meanwhile illegal products are going up in price. Since legalization, the price per gram for illegal product has gone up 22% in price, while the average legal gram has gone down by 32%.

Pricing is improving in the legal market and it will continue to improve. Providing we continue to spend our money there. As licensed producers continue to recoup their costs, cannabis will get cheaper. Creating barriers to cannabis sales will only prevent cannabis retailers from lowering their price.

Source: UP Cannabis/Hexo

Brands are improving their quality too! Not just the price.

At the beginning of the month, Hexo announced they were reposition their brand UP to acknowledge the lack of potency in their products. The campaign is intended to highlight consumer complaints and address them directly. This campaign is intended to be a pledge to their customers, promising to do better and provide a better product.

The Hunny Pot | 2591 Yonge St.

Why can’t/won't the government do the same?

I have to give the government some credit, the ACGO has been regularly doubling the number of RSA’s (Authorizations) they’re issuing to stores. There are currently 269 stores (as write this on December 11th 2020) authorized to open. There’s another 1100 waiting to open.

Although Alberta has over 500 authorized store and British Columbia has nearly 300. It would be nice if we could be the province with the most dispensaries, but in the meantime The ACGO deserves credit for picking up the pace.

Health Canada has announced they are willing to take comments on the current restrictions regarding cannabis. Read the article here.

If you're like me and take issue with the current treatment of cannabis, voice your complaints to:

[email protected]

Keep in mind Health Canada and the Ontario Government handle different parts of regulating cannabis. Changes on a federal level are definitely a start and should motivate movement from the Ontario government.

The cannabis marketing is booming in Ontario? Why is it being held back?

Licensed producers are acknowledging they need to make changes. They are holding themselves accountable to their consumers. Even the federal government is attempting to make changes. They're even asking for our opinion. (Write in, tell them what you think!)

Why won’t the Ontario government give cannabis a break? Heavily regulating the dispensaries with unfair and inconsistent laws is only going to hold the industry back.

Preventing dispensaries from competing with the illegal market to their full ability while offering privileges to other industry is not fair. What's even worse is forcing the dispensaries to compete with their own supplier, who provides better services because they control the laws. Unfair. I don’t know another way to put it. Especially when they give themselves preferential treatment while limiting the abilities of their competitors.

When money is being poured into an industry, why would anyone want to hinder progress? Especially when they could stand to directly benefit from it themselves. The OCS still profits when dispensaries sell cannabis. They may not make as much per unit, but there’s profit in selling thousands of units at wholesale volumes. That’s money that could be going into services, infrastructure, the community. Why fight it? Hurting local dispensaries owned by private citizens isn’t going to benefit anybody.

If you’ve made it this far, please leave a tip.

If I made you think, don’t hesitate to email me at [email protected]

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About the Creator

Josh Socket Writes

I'm a copywriter. My first thought was to create a library of cannabis information but I've decided to expand my writing.

I used to write for an agency that specialized in merchandising for influencers. Check it out.

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