Legal Dispensaries Delivering AgainSam B.
But How Do They Stack Up Against Grey Market Delivery Services?
Not well, but they’re doing their best.
As part of the response to the most recent wave of the ongoing pandemic, Canadian dispensaries have been allowed to offer home delivery to clients for a limited time. This is actually the second time they’ve been allowed to do so since the lockdowns first began, but there was a reprieve over the holidays when we were briefly in between disasters.
That’s enough pandemic talk for now, though, I wrote enough about that in another of my recent posts.
Long story short, the government opened the doors for our province’s legal dispensaries to offer what the grey market has offered every day, since long before the dawn of time. Unless you had a dealer that would make you walk to theirs, of course, then it’s simply not happening- ever. Just drop it, alright? Who doesn’t want a hit from the nastiest bong in existence while you’re waiting for your guy to weigh it out over a pizza box that’s been there for a month.
Is that relatable? I long for a world where it isn’t.
Why Is Legal Cannabis Embracing Delivery Now?
I don’t think I’ll rattle any cages when I suggest that the ongoing pandemic made life fairly difficult for everyone, and in a lot of ways, small businesses were probably among the hardest hit. Most Ontario dispensaries, aside from the big names, fall into that category- they’re small retail businesses, and most of them operate out of a single location.
Not to mention that a lot of them were opening at the same time. Late last year, in September, it was widely reported that Ontario alone had seen the opening of over 1,000 licensed dispensaries since cannabis was legalized. So many retail outlets opened in a short span of time that the competition to stay open and provide unique offerings proved difficult for most. It became a lot more difficult once lockdowns started, and most newer stores hadn’t built up enough of a customer base to survive.
Not wanting to discourage those who waited through the long, chaotic process of becoming licensed retailers of cannabis, the government had to ensure that their stores could compete. I can only imagine that, prior to the government allowing licensed retailers to make direct deliveries, that the grey market saw a sizeable increase in profits from people who wanted to order and pay for their cannabis with minimal human interaction.
It was the safer option at the time, regardless of how legal it may not have been!
With internal competition between licensed retailers being so fierce, the solution had to be one that benefitted all dispensaries as equally as possible- We hardly need an accusation of our fine provincial government as being the type to play favorites, now, do we?
Delivery service was intended as a stop-gap, that local dispensaries could use to stay afloat through an uncertain time. Things changed, however, once their clientele became accustomed to the perks of home delivery.
The Changes Keep On Coming
Even as I’m writing this, the scoop is still developing.
In October of last year, a number of changes to the legislation governing the sale of cannabis within Ontario were proposed by the provincial government. One of the suggested changes was to allow licensed dispensaries to offer home delivery, even after lockdown measures are eventually reduced and brought to an end.
I wouldn’t be surprised to see local dispensaries listed on all the delivery apps, if it happens.
Currently, dispensaries have temporary authorization to deliver under the Reopening Ontario (A Flexible Response to COVID-19) Act, which was passed in 2020. The legislation concerns a number of industries, not only cannabis, and is considered an integral part of the province’s emergency response to the ongoing situation.
Still, once the emergency subsides, the act will likely be repealed. When ever it happens, the boost in morale it would cause is too much to pass up. There would really be no better way to tell the country that the threat is passed- that the emergency is over.
Will It Really Happen, Though?
I wouldn’t be surprised.
With bigger players trying to get into legal cannabis, the ones that can afford to home deliver cannabis within a reasonable time frame are likely to come out ahead. Especially the likes of massive companies like Shopper’s Drug Mart, backed by distribution chains beyond what any local shop could offer.
Though allowing home delivery appears to be a benefit for smaller retail stores, I think that in time, it might lead to big entities having the power to take over markets more easily. It’s a lot less difficult to expand your delivery area when you already have distribution centres all across the country!
That’s not a power the majority of legal cannabis outlets have access to.
All in all, I doubt that opening the legislation to allow for home delivery will do more harm than good to the majority of small canna-businesses.
The customers who choose to buy grey market cannabis won’t flip for home delivery- most of them get it already, and a lucky few get free delivery from their service of choice.
Allowing legal retailers to offer home delivery just opens up another way that they have to compete with the grey market- and I don’t think most will have the means to outperform the people who have been in the business for years!
If you want it delivered, you’re not gonna beat the grey market for price OR convenience.