Private pot shops have advantages: prof

The provincial government’s plan to legalize marijuana could change to include privatized sales.

It’s been reported that Conservative Premier Doug Ford plans to extend marijuana sales to private business owners. Kathleen Wynne’s Liberal government had planned to limit sales to Ontario cannabis stores overseen by the Liquor Control Board of Ontario.

According to Michael Armstrong, a Brock Goodman School of Business professor, privatized sales could help reduce illicit marijuana sales.

Armstrong said the current plan to sell marijuana through provincial stores will not meet demand.

The 40 retail stores planned to open for the Oct. 17 legalization of marijuana is comparable to the number of Costcos in Ontario, he said.

“There’s one in every major centre, but they’re not really convenient for consumers,” Armstrong said. “It’s a planned shopping trip.”

Even if the planned full complement of 150 Ontario stores are opened in 2020, Armstrong still doesn’t think it would be enough.

Alberta and New Brunswick are both offering more stores per capita, he said. New Brunswick is opening 20 stores with a population of about 750,000 people, whereas Ontario is to open 40 stores in 2018 for 13.6 million.

“That gives you a realistic idea of what numbers we need for Ontario’s population,” he said.

While he thinks privatized sales will reduce illicit sales, Armstrong also warns that meeting regulations for privatized sales in time for the Oct. 17 deadline is impossible.

Alberta, which is allowing private sales, began accepting applications for licences months ago, he said.

A compromise he suggested is contracting Ontario Cannabis Retail Corp. to existing licensed marijuana producers in Ontario — there are about 59 — to open greenhouse outlet stores.

“Those are companies that have already been vetted by Health Canada, they clearly know what cannabis is about,” he said. “So, if the Ontario government is looking for a relatively quick way to get a lot more stores, it would be a safe bet for them.”

In addition to obvious benefits to the economy such as new jobs, greenhouse outlets could give smaller growers a chance to enter the market, Armstrong said. Smaller growers could offer services similar to those of local wineries in the Niagara region, he said.

“Each one has their own wine tasting … they can sell some of their own products. It’s kind of a premium product experience for the consumer, so you could see something like that going with the smaller cannabis producers as well.”