POT SHOP AP­PROVALS STALLED

AGLC wres­tles with sup­ply crunch

Calgary Herald - - FRONT PAGE - SHAWN LO­GAN

The prov­ince’s need for weed has prompted Al­berta Gam­ing, Liquor and Cannabis to deny new ap­pli­ca­tions and with­hold re­tail li­cences for pot shops amid an on­go­ing na­tional cannabis crunch.

On Wed­nes­day, the pro­vin­cial agency re­spon­si­ble for over­see­ing Al­berta’s fledg­ling le­gal cannabis in­dus­try said on­go­ing sup­ply short­ages have prompted the tem­po­rary halt to ap­prov­ing more re­tail­ers un­til sup­ply lines are sta­bi­lized.

Alain Maison­neuve, pres­i­dent and CEO of AGLC, said a na­tion­wide short­age of re­cre­ational mar­i­juana has af­fected Al­berta stores that they had hoped would have enough sup­ply to last for months.

“AGLC or­dered enough prod­uct to sup­port up to 250 re­tail stores in the first six months of le­gal­iza­tion; how­ever, as of Novem­ber 17 we have only re­ceived ap­prox­i­mately 20 per cent of what we had or­dered,” he said in a state­ment.

“While some li­censed pro­duc­ers have ful­filled their com­mit­ments, not all have. We con­tinue to work with them to fill stock. Un­for­tu­nately, re­gard­less of our ef­forts, we are see­ing the sup­ply of most prod­ucts run out.”

AGLC said it had taken steps to se­cure more prod­uct as loom­ing short­ages be­came ap­par­ent, con­tact­ing all pro­duc­ers with fed­eral li­cences to sell cannabis, but were un­suc­cess­ful.

Given the short­age, AGLC an­nounced it will tem­po­rar­ily halt ac­cept­ing new ap­pli­ca­tions as well as freez­ing ad­di­tional cannabis re­tail li­cences in­def­i­nitely. Ap­pli­cants will be en­ti­tled to a full re­fund of any fees should they wish to with­draw from the process.

AGLC spokes­woman Heather Hol­men said un­til sup­ply is sta­bi­lized, the fo­cus will be on Al­berta’s 65 cur­rently li­censed re­tail­ers, which will split weekly ship­ments evenly, with a smaller share kept for the agency’s on­line cus­tomers, many of whom live in com­mu­ni­ties not served by cannabis shops.

“It’s es­sen­tially be­ing ra­tioned,” she said, adding the prov­ince has con­tracted with 15 li­censed pro­duc­ers whose out­put has fallen well short of what had ini­tially been pledged.

“We’re not hoard­ing for our­selves. Weekly prod­uct will be split 65 ways equally, and re­tail­ers will have the op­tion to pur­chase up to that limit.”

The bomb­shell came just as NewLeaf Cannabis, which op­er­ates the most li­censed shops in Al­berta, this week opened eight stores, in­clud­ing four in Cal­gary.

NewLeaf CAO An­gus Tay­lor said the sit­u­a­tion is dev­as­tat­ing to those who fol­lowed the rules and in­vested sig­nif­i­cant money and re­sources into their busi­nesses on the be­lief there would be am­ple sup­ply of the drug, which was le­gal­ized by the fed­eral gov­ern­ment Oct. 17.

“This is go­ing to im­pact ev­ery cannabis re­tailer. We have 14 li­censed stores but our plan was to open 25, and now we don’t know when any of those li­cences will be is­sued,” he said, not­ing he ex­pects there will be enough sup­ply for the new stores that launched, but as prod­uct is sold it’s un­clear what they’ll be able to keep on the shelves.

“We’re def­i­nitely con­cerned. We’ve hired peo­ple, we’re pay­ing rent, we’ve done ren­o­va­tions — I think there’s go­ing to be a lot of sin­gle-store op­er­a­tors dev­as­tated by this.”

As of Wed­nes­day, some 65 re­cre­ational cannabis re­tail­ers had been granted li­cences by AGLC, in­clud­ing 20 in Cal­gary. A quick re­view of AGLC’s own on­line cannabis shop found just 19 of 146 listed prod­ucts cur­rently in stock.

Ac­cord­ing to num­bers pro­vided by the city, there are cur­rently 104 ap­pli­ca­tions that have met all of the city’s cri­te­ria and only need to ob­tain a li­cence from AGLC along with a busi­ness per­mit.

Brandy MacInnis, se­nior plan­ning and pol­icy strate­gist, said the city is try­ing to de­ter­mine its next steps.

“The City ’s cannabis le­gal­iza­tion team is cur­rently look­ing into what this means to those cus­tomers cur­rently in the ap­provals or ap­peal process,” she said in a state­ment.

“The City will be con­tact­ing cannabis re­tail cus­tomers over the next few days with ad­di­tional in­for­ma­tion and op­tions for their con­sid­er­a­tion.”

Cam Bat­t­ley, chief cor­po­rate of­fi­cer of Al­berta-based Aurora Cannabis Inc., said given the still nascent na­ture of the in­dus­try, cou­pled with over­whelm­ing de­mand, sup­ply short­ages shouldn’t come as a ma­jor sur­prise.

But he ex­pects the bot­tle­neck cur­rently fac­ing the in­dus­try won’t be long-term.

“Al­berta is not alone in deal­ing with these con­cerns. We’re hear­ing ev­ery prov­ince and ter­ri­tory say­ing a ver­sion of the same thing,” Bat­t­ley said.

“This was to be an­tic­i­pated when we’re rolling out a very new and com­plex sys­tem. Ev­ery­body needs to step back and take a breath — ex­pect­ing per­fec­tion on Day 1 of such a com­plex new in­dus­try would be a lit­tle bit un­rea­son­able.”

Jeff Mooij, pres­i­dent of Four20 Pre­mium Mar­ket, said its most re­cent cannabis ship­ment from AGLC in­cluded a poster to hang on the door, in­form­ing cus­tomers that they were out of stock, a trou­bling sign the short­ages may be more than a mi­nor hic­cup.

We have 14 li­censed stores but our plan was to open 25, and now we don’t knowwhenany of those li­cences will be is­sued.

“I don’t know what to ex­pect. Ev­ery week’s dif­fer­ent, we’re not sure what level of in­ven­tory we’re get­ting and nei­ther does AGLC at this point in time be­cause … they ’re not get­ting what’s been promised, not even close,” he said.

“It’s a fur­ther hole we’re dig­ging for our­selves and it’s a scary en­vi­ron­ment to be in.”

Out­lets li­censed by the AGLC to sell re­cre­ational cannabis in Cal­gary (not all lo­ca­tions may be open for busi­ness):

JIM WELLS

“Ev­ery week’s dif­fer­ent, we’re not sure what level of in­ven­tory we’re get­ting,” says Jeff Mooij, pres­i­dent of Four20 Pre­mium Mar­ket.

JIM WELLS

Just 19 of 146 listed prod­ucts are cur­rently in stock on the AGLC’s on­line cannabis shop.

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