In June 2018, Canada voted on and obtained royal assent to legislation that led to the near full legalization of recreational cannabis use and home growing of up to four plants. For the most part, the federal government set out some standards such as age and carrying limits, but left the details on consumption and private versus public owned dispensaries up to the individual provinces.
In Ontario, it was initially announced that all stores would be publicly owned and run with the LCBOs oversight apparatus.
This shifted and the government of Ontario announced the first round of cannabis retail store licenses were going to be limited and winners would be drawn by lottery. This caused a wave of retail license owners to hold onto their licenses until they could be sold to large conglomerates with hopes of cornering the market on stores across Canada to make a profit, with some licenses rumoured to go for millions of dollars apiece.
Others have said that there would be a consolidation of retail space in this sector going back almost a year. What the story leaves out is how difficult it is to obtain these licences, how much money it costs, $10,000 for licences, $6,000 non-refundable just to enter the lottery, along with a letter of credit for $50 000 and an approval time in the span of months.
All this brings us to the current issue I see with the industry, something quite startling to be honest. Where are all the cannabis consumption places? Where are the cool cafes? The fun fusion food eateries, the vape lounges and cannabis bars? Are these places not perfectly good business pairings to the cannabis industry? Why is it that alcohol, which by and large does statistically more harm than the cannabis industry, has bars, restaurants and other such spaces, but cannabis does not?
One can say stigma plays a role but stigma does not make a law, this seems to me to be an unequal application of legislation that is causing harm to the industry and in my opinion, consumers seeking more from their cannabis experiences.
Waterloo has already seen a saturation of stores and some casualties from this one-horse approach to legalization. Just this week after months of struggles, and only months of operations, HyperLove cannabis shut down due to financial hardship.
This will cause price issues down the line when these large companies have a market monopoly, and need to make a profit after selling at a loss for so long. One of the few ways to mitigate this would be to open the market to more business opportunities by creating legal, safe consumption spaces like the ones I have outlined. While it is not the government’s concern to manage every failing business the government does play a role in making this industry more equitable. If the cannabis industry is to keep growing as a job market, more kinds of workplaces will need to be engineered and legislated. Otherwise, there will be a constant cycle of closures, turnover, and conglomeration until Ontario is left with a legal market worse off than when it started.
The people who are involved in this industry are passionate and driven, they love what they do and they have been waiting for a long time to get involved with the legal market. If stores are the only way to purchase and consume cannabis, we will continue to see this cycle of attrition until the only cannabis stores in operation are large franchises.