Article by Joseph Hall, Toronto Star
There have been product shortages, leasing and construction headaches and licensing hoops so numerous that only 20 of the 25 retail cannabis stores that were scheduled to open April 1 in Ontario have done so.
So, how’s business two months in?
“It’s hard to say how lucrative it’s been,” says Matt Maurer, vice-chair of the Cannabis Law Group at the Toronto firm Torkin Manes LLP. “But I don’t think any of them, if you could take a time machine and go back, would say I wish I’d never gotten into this.”
Hunny Gawri certainly wouldn’t.
Gawri, proprietor of the Hunny Pot Cannabis Co. shop on Queen St. W., estimates that 50,000 to 60,000 customers have jammed into his four-floor boutique since April 1. “We’re taking it day by day and trying to get better,” says Gawri, whose store was the only one of five initial provincially allotted shops to open in the city on that mandatory date.
“Like any business, there’s a learning curve.”
But all in all, the 34-year-old pot merchant pronounces himself very satisfied with how things have gone.
And while the grand-opening lineups have disappeared, customer volumes have remained strong over the ensuing weeks, Gawri says.
“We actually have been maintaining the same flow of people, we’re just becoming more efficient now with the lineups,” says Gawri, who says between 800 and 1,000 customers visit the store each day.
About a third of those, Gawri says, are now served through an express desk, where people who know exactly what they want can order at reception and pick it up directly.
The rest are still served by the store’s signature stable of “budtenders,” who greet each customer individually at reception — where all are asked for picture identification — and guide them one on one through the store.
Indeed, Gawri says the shop’s continued customer volumes have allowed him to increase staff levels to some 65 from about 54 on opening day.
“Every day we try to make it better … catering to what people are looking for,” he says.
And what customers have been looking for in the largest numbers, Gawri says, are products with high levels of THC — the buzz-inducing, psychoactive component of cannabis.
But Gawri says there has also been a steady demand for products that have equal amounts of THC and the more medicinal CBD cannabis component — a mixture that provincial and federal regulators and many pot experts have urged on neophyte users as a more freak-out-safe alternative.
“There’s also been a lot of requests for CBD products — CBD pills, CBD sprays, CBD capsules,” he says. “People who have come in and never tried (pot), that’s their comfort level. They don’t want that psychedelic high.”
Supply problems have been endemic in Ontario stores, with a pair of shops in Ottawa and Hamilton being forced recently to cut back their hours for want of product.
These shortages, ironically, may themselves be due in part to the small number of stores this province has allowed to open.
Largely because of supply shortage fears, the province set that initial number at 25, with five slated for the city, six for the surrounding GTA regions, five more in the eastern part of the province, seven in the west and two in the north.
But the small number of shops here are almost certainly causing licensed producers to favour provinces with more brick-and-mortar facilities up and running, says industry expert Nick Pateras.
Pateras, vice-president of strategy at the cannabis resource and information company Lift & Co., says many licensed producers have said they would ship their wares preferentially to provinces that have more stores.
“They just recognize that stores will be the long-term preferred channel for customers,” rather than buying online.
Such store-based preferences have seemingly eradicated supply problems in Alberta, which had 100 outlets as of last month, Pateras says. On May 30, that province lifted a moratorium on retail licences, announcing it would issue five a week for the foreseeable future, he says.