The Alcohol and Gaming Commission of Ontario, which controls cannabis sales in the Canadian province, has established new rules to enable cannabis retailers to offer delivery and curbside pick-up services on a permanent basis beginning March 15, 2022.
The new policy is intended to make permanent the two sale modalities that were temporarily authorized under the Reopening Ontario (A Flexible Response to COVID-19) Act from 2020. Delivery orders must be placed with a specific store and third-party deliveries will not be allowed.
Expand Access To Legal Markets
Regulators seek to widen the cannabis offer for buyers and expand access to the legal cannabis market, reported The Star.
Bubba Nicholson, vice-president of business development and ethos at Thrive Cannabis, a firm cultivating premium quality, small-batch craft cannabis in Ontario, is enthusiastic about the move that could help rebound the retail segment.
“We need to empower the retailers to be able to try and get customers in their door either virtual or bricks and mortar as best they can,” he said.
Drive Competition
The policy prevents cannabis retailers from operating entirely or predominantly as delivery businesses. “This means cannabis retailers will not be able to adopt the same model being used by some quick-service restaurants and other retailers,” reported local media.
Meanwhile, Omar Khan, senior vice-president of corporate and public affairs at High Tide Inc. (NASDAQ:HITI) said the policy will prevent delivery-only businesses from being dwarfed by large companies that could dominate cannabis’ e-commerce.
“This will drive competition and help ensure greater choice for consumers,” Khan noted.
Robyn Rabinovitch, Thrive’s vice-president of sales and marketing, said that setting up a delivery service takes time and can be expensive. “It’ll be interesting to see how viable those business streams are for the future with everyone running so tightly month to month and the larger cost being imposed on those that try and stand out through delivery services.”
Cannabis may only be delivered at a time when the physical cannabis retail store is open to the public.
Retail stores located within malls may still complete deliveries between 9:00 a.m. and 11:00 p.m, reported the Commission in an information bulletin on March 1st.
Image via El Planteo.
