Though Canada made history with its landmark legalization of recreational cannabis last year — and with edibles legalization last week — an uneven retail segment has stifled growth for firms in the space, experts say.

Canada’s marijuana retailers are now faced with the difficult task of attempting to root themselves in the early stage market.

Mark Goliger, CEO of National Access Cannabis (NAC) (TSXV:META), told the Investing News Network (INN) that the regulatory environment has suppressed the industry thus far.

During an investor event held by Echelon Wealth Partners in Toronto, Ontario, last week, Goliger said the illicit market is the biggest competitor to the regulated industry, and the limited number of stores in the country is cutting into potential profits.

Retail struggles go hand in hand with marketing restrictions. The Cannabis Act heavily restricts the promotion of cannabis and cannabis-related products, limiting players in the space, Goliger said.

“Bill C45 does all that it can to tie hands behind our backs, put cement blocks on our feet,” he said.

“How’s that brand going to come to life when you can’t have a billboard, when you can’t do radio ads, when you can’t do a magazine ad, where you can’t do a regular, traditional marketing campaign?” the executive continued as he aired his frustrations with the industry.

Nadia Vattovaz, CFO of fellow retailer Fire & Flower Holdings (TSXV:FAF), echoed Goliger’s point and told INN that it’s difficult to build a brand in Canada with the current regulations.

She added that physical storefronts are one of the only ways retailers can actually establish recognizable cannabis brands in the country.

Vattovaz said creating direct access to the customer is what consumer product companies and licensed producers (LPs) should be focusing their efforts on.

“Things like brand placement, doing activations and retail locations — that will help build their brand. But it’s going to be a bit of a haul just over the course of time because really, it’s … store by store by store,” Vattovaz told INN.

Ontario, Canada’s most populous province with over 14 million residents, according to Statistics Canada, has currently issued 75 retail licenses, meaning that once the entire second wave of stores opens, there will be about one cannabis retailer for every 19,000 people.

At a panel during the recent MJBizConINT’L event in Toronto, Inner Spirit Holdings (CSE:ISH) CEO Darren Bondar said Ontario could hold easily 1,000 stores “without looking like the pot capital of the world.”

Ontario’s license lottery system came under fire earlier this year as some players in the space said it turned the process of building out the sector into a game of chance.

On Tuesday (October 15), the Ontario Cannabis Store, the provincial regulator for cannabis retailers, said in a release that it’s consulting with commercial partners to explore delivery methods to improve engagement between LPs and authorized retail stores.

Other key provinces, including Quebec and British Columbia, have also had slow store rollouts, and Quebec has been further hindered by the ban on edible cannabis products issued earlier this year.

Both NAC and Fire & Flower are looking to access the market in Ontario as it begins to open up — Goliger called it “the biggest market opportunity” the firm has as a retailer — though Vattovaz said Fire & Flower will focus on the western part of the country in the meantime.

Alberta, on the other hand, has fared better on the retail front. Currently, the province has the most marijuana stores in the country with over 300 locations, which means there is about one cannabis store for every 14,000 people.

An Alberta-based retailer, High Tide (CSE:HITI,OTCQB:HITIF), confirmed that it generated C$797,000 in system-wide gross sales through its 26 retail locations from last Thursday (October 17), the day edibles were legalized, to Saturday (October 19).

Both NAC and Fire & Flower have the bulk of their stores in Alberta, and NAC also has a presence in Manitoba through its line of Meta Cannabis Supply Co. retail fronts.

Goliger said LPs need to start investing in different formations and formulations for their cannabis products, especially as they move into the so-called Cannabis 2.0 phase of legalization.

The NAC executive said Alberta and Manitoba will continue to be growth opportunities for the company.

For Fire & Flower, Vattovaz said the company plans to have 45 stores open by the end of its fiscal 2019 year and is looking to leverage a recent investment from convenience giant Alimentation Couche-Tard (TSX:ATD.A).

Don’t forget to follow us @INN_Cannabis for real-time news updates!

Securities Disclosure: I, Danielle Edwards, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: High Tide is a client of the Investing News Network. This article is not paid-for content.

The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

Trulieve to donate $20,000 in scholarship funding and $15,000 to support leadership development

Trulieve Cannabis Corp . (CSE: TRUL) (OTC: TCNNF), a leading and top-performing cannabis company in the United States today announced a new partnership with the Thurgood Marshall College Fund (TMCF), the nation’s largest organization exclusively representing the Black College Community. Trulieve will donate $20,000 to help fund several college scholarships awarded to students who are attending one of the organization’s member-schools as part of Trulieve’s diversity, equity, and inclusion initiatives. The $15,000 in talent funding is earmarked to support TMCF’s internship program, reaching a diverse talent pool of students and alumni from their 47 member-schools to provide immersive experiences at Trulieve.

Keep reading... Show less

The new dispensary expands patient access to Florida’s largest inventory of medical cannabis products

Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) (“Trulieve” or “the Company”), a leading and top-performing cannabis company based in the United States announced today the opening of a brand-new Florida dispensary, the Company’s 80th nationwide. The new location marks the Company’s first in Tamarac and third in Broward County expanding patient access to Florida’s largest and broadest assortment of high-quality medical cannabis products.

Keep reading... Show less

Revive Therapeutics Ltd. (“Revive” or the “Company”) (CSE: RVV, USA: RVVTF), a specialty life sciences company focused on the research and development of therapeutics for medical needs and rare disorders, is pleased to announce an update on the Company’s U.S. Food & Drug Administration (“FDA”) Phase 3 clinical trial (the “Study”) to evaluate the safety and efficacy of Bucillamine in patients with mild to moderate COVID-19.

With its recent $23 million dollar financing, the Company plans to aggressively expand from 14 clinical sites to up to 50 clinical sites to meet the next enrollment goals for the Study in Q2-2020. The Study is a randomized, double-blinded, placebo-controlled trial and the safety and efficacy data analyzed at each interim analysis timepoint of 210, 400, 600 and 800 completed patients are only made available to the Independent Data and Safety Monitoring Board (“DSMB”) for review and recommendations on continuation, stopping or changes to the conduct of the Study. In the event of any serious safety concerns, the DSMB would be notified to determine any risks and provide its recommendations. To date, in this initial 210 interim point there have been no serious safety concerns that required the DSMB to be notified.

Keep reading... Show less

HempFusion Wellness Inc. (TSX:CBD.U) (OTCQX:CBDHF) (FWB:8OO) (“HempFusion” or the “Company”), a leading health and wellness CBD company utilizing the power of whole-food hemp nutrition, is pleased to announce that its common shares have been approved for DTC full-service eligibility in the United States by the Depository Trust Company (“DTC”) and can now be both traded and serviced through DTC’s electronic book-entry system.

DTC is a subsidiary of the Depository Trust & Clearing Corp. (“DTCC”) that provides clearing and settlement services for the financial markets and settles the majority of securities transactions in the United States. This electronic method of clearing securities speeds up the receipt of stock and cash and thus accelerates the settlement process for investors and brokers, enabling the stock to be traded over a much wider selection of brokerage firms.

Keep reading... Show less

CFN Enterprises Inc. (OTCQB: CNFN) (CFN Media) partners with FMW Media Works LLC to produce a regular series on the global cannabis markets to air on major financial news networks across the US. Initial segment features leading cannabis analyst and US Multi-State Operator (MSO)

CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the leading media network dedicated to the global legal cannabis, CBD and psychedelics industries, today announced that its inaugural news segment on the cannabis markets, “Cannabis Market Outlook for 2021,” will air on Bloomberg, Newsmax and Fox Business.

Keep reading... Show less