Canada’s largest cannabis company enters province’s already-crowded retail scene
Canopy Growth Corp. to open 10 outlets in province, including one on Whyte Ave.
Canada’s largest cannabis outfit has arrived on Alberta’s retail scene in what its operators say is a show of confidence in what is sometimes seen as a saturated provincial pot market.
On Friday, Ontario-based Canopy Growth Corp. opened two stores in Calgary, among the first of its 10 Tweed and Tokyo Smoke outlets that will be operating in Alberta by mid-september, said Canadian general manager Grant Caton.
They’ll create about 100 jobs in the province.
“Alberta’s been an amazing market for us and we want to continue to invest and grow there,” said Caton, whose company’s products have been available in Alberta through other retail outlets.
“Alberta’s matured the fastest and it’s hard to quantify if it’s oversaturated.”
Depending on how the economics of the move pan out, there could be more Canopy-owned stores in Alberta’s future, he said.
Seven of the 10 new stores will be in Calgary, though Caton said that has more to do with the company finding and sitting on good locations in the city over the past few years than any consumer anomaly.
Its Alberta flagship store, he said, will serve customers on Edmonton’s Whyte Avenue.
Those outlets help push the number of cannabis stores in Calgary to 127 — more than any other city in Canada — and 516 in Alberta, which has about half of all pot shops in the country.
Some players in the cannabis industry in the province and elsewhere in Canada have been contracting in recent months in the face of underwhelming revenues and premature expansion.
Canopy Growth hasn’t been immune to some of those challenges and has seen its stock value tumble significantly this year.
Caton said he’s confident the consumer base has increased since recreational use of the drug was legalized in October 2018, and that the fortunes of his company and the industry will turn.
Much of that, he said, is driven by a steadily widening variety of products beyond the smokable flower that many Canadians still spurn, with Canopy banking on a line of THC and CBD -infused beverages.
“The cannabis industry has a lot of opportunity and (consumers) want to go into the bricks and mortar outlets,” he said.
Canopy is one of the few cannabis players that has vertically integrated — both producing products and marketing them in its own stores.
Caton said about 50 per cent of its Alberta outlets’ inventory will be self-produced.
Canopy’s debut continues the trend to more access and variety for Alberta consumers, said Nathan Mison, chairman of the Alberta Cannabis Council.
And the company will enter a retail fray that has become a centre of storefront rivalry, he said.
“Three of the biggest retailers — High Tide, Fire and Flower, and Spirit Leaf are headquartered in Alberta,” said Mison.
“Canopy’s really going to have to compete, and a lot of it is ‘how are you going to differentiate yourself?’”
He said it’s still unclear whether Alberta has too many cannabis stores, but some will likely fall victim to competition.
“You will see contraction — this is a lesson Canada and each province is learning in real time,” said Mison.
After liquor retailing in Alberta was privatized in 1993, the number of stores reached 2,200 about two decades ago before contraction began and now sits at 1,500.
Earlier this month, a spokeswoman for regulator Alberta Gaming, Liquor and Cannabis said five cannabis stores have closed their doors throughout the province.
Earlier this summer, Canopy opened a research facility in Edmonton but Caton said it has no plans of establishing a licensed production presence in Alberta.
With its Alberta openings, Canopy will count 50 stores in Canada, with 29 of them in the West.
Canopy’s really going to have to compete, and a lot of it is ‘how are you going to differentiate yourself?’