Cannabis storefronts open in Canada's largest market

Published 02-APR-2019 09:50 A.M.

|

3 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.


Click Here to View Latest Articles

The first brick-and-mortar retail cannabis stores opened in Ontario on Monday, attracting long lines of enthusiastic customers in Canada's largest marijuana market six months after legalization writes Michel Comte.

In Toronto, dozens of people camped overnight outside the city's only outlet, Hunny Pot Cannabis Co., while in Ottawa, one customer - bundled up in a parka and knit cap - said he waited two hours in the cold to be the first in line at Fire and Flower.

"This is the opening of the retail market in Ontario, which is Canada's largest, so we have very high hopes for our flagship store in the province," Trevor Fencott, chief executive of Fire and Flower, told AFP.

"We're expecting brisk sales today," he said as customers poured in to its Byward Market location in downtown Ottawa.

The retailer, which has nine other storefronts in Alberta and Saskatchewan, partnered with a local accountant and a former home heating and cooling equipment salesman to break into the Ontario market.

In October, Canada became only the second country - and first G7 economy - to legalize the recreational use of cannabis.

Over the past six months, a patchwork of online and physical stores have popped up across the country, as each province rolled out their own marijuana retailing framework.

In Quebec, there were huge lines outside government-run stores during the first few months of sales.

Ontario started selling cannabis through an online portal last October and a lottery was held in December for prospective marijuana shop owners. Only 10 of the winners were actually ready to open on time on Monday.

"From what I can see they've done a great job in terms of (store) decor, sophistication," said David, one of Hunny Pot's first customers. "Overall, this is a real nice experience to be able to purchase in a legal, adult recreational store."

- Sticker price shock -

Eric Lavoie, who with partner Michael Patterson won a license to operate a cannabis store in Ottawa and sold a stake to Fire and Flower for shares in the company worth more than Can$1 million (US$750,000), said: "I've never won anything in my life like this, it's exciting."

"If we sold out today we'd be very happy, but I think we have ample supply," he added, noting a nationwide supply crunch.

There is demand for more than 2,000 storefronts in Ontario, according to industry sources, but the province with a population of 14 million allowed just 25 to start.

Sales on Monday were orderly. A man in Toronto who smoked a joint in line was turned away at the counter because he was intoxicated.

"The fact that it's legal now and you can go into a store without getting in (legal) trouble is amazing," said Hunny Pot customer Stephanie, giving only her first name, after spending 12 hours in line.

Some expressed sticker shock. Prices for legal cannabis are nearly double the rates on the black market, according to the government statistical agency.

"It's very difficult to see my generation, who have grown up with the grey market, transitioning to this price point," Ben Schilling, who paid Can$129 for 10.5 grams of pot, told the Toronto Star.

Fencott acknowledged that pricing is "certainly a challenge," but added that fresh supplies coming soon should put downward pressure on prices.

© Agence France-Presse



General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.

 

Discover Small Cap
Biotech Stocks

Join thousands of other Investors following our stock commentary for Free

X