Ontario could do away with cannabis retail license caps by January: report

Nov 21 2019, 1:40 pm

The Province of Ontario may be getting out of the cannabis distribution game and switching to an open licensing process for weed retail as early as January, according to reports in BNN Bloomberg.

Setting its sights high with hopes of eventually opening 750 to 1,000 stores across Ontario in 2020, according to a source speaking with Bloomberg, the provincial government has not yet reached a decision, citing a lack of consensus in cabinet.

“That’s eventually what the goal is — open it up to the market and let the market dictate,” Ontario Premier Doug Ford is quoted as saying Thursday morning. “It’s like any business: some people will be successful, some won’t.”

Bloomberg’s David George-Cosh reports he was also able to obtain a copy of an email sent by Denny Palarchio, vice president of supply chain and customer excellence at the Ontario Cannabis Store to licenced producers.

The email reportedly outlined the Province’s plans to allow for “third-party centralized distribution,” a move away from the current model of public distribution, that has the OCS, a Crown corporation, filling in the role.

“It is expected that these activities will continue to drive cost efficiencies for the industry and result in ongoing expansion of product assortment and service levels, thereby supporting future product development and innovation by producers,” he is quoted as saying.

Another interesting addition to the current cannabis regime would be “direct-delivery.” Different from the practice of farmgating, where producers would be allowed to sell products in retail outlets near or attached to their production facilities, under the proposed changes LPs would be able to ship product directly to customers, without using a distributor.

According to the report, OCS confirmed the authenticity of the email and its contents.