StatCan paints an optimistic picture of retail cannabis sales
In the first year of legalization, nearly $908 million worth of legal, non-medical cannabis was sold across Canada, according to a StatCan report released earlier today.
While sales fell short of projections made by Deloitte ($4.34 billion) and Canaccord ($1.46 billion), a number this close to $1 billion surely comes as a relief to c-suite staff, stakeholders, and investors who have been under intense pressure over the last several weeks.
A chart in the report indicates that, with the exception of a dip in retail sales in late August 2019, sales across the country have steadily increased since October 2018.
Cannabis sales took place at more than 400-plus brick-and-mortar stores across the country, as well as online. (The majority of stores are in Alberta, where Alberta Gaming, Liquor, and Cannabis has approved licences for more than 250 stores since October 17, 2018.)
Predictably, the country’s most populous province, Ontario, took the lion’s share of sales at about $217 million, with Alberta ($196 million) and Quebec ($195 million) following next in line.
Per capita, Canadians spent just $24 on cannabis. (By our estimate, that’s about a gram and a half, tax in, and without a delivery charge.) Unsurprisingly, the province with the lowest per-capita sales, at an embarrassing $10, was British Columbia. Total sales in B.C. came in just short of $50 million.
The report credits access to retail stores for the vast differences in per capita values. It suggests that access is impeded in certain regions due to a number of factors, including competition from the illegal market, and differences in regulatory approaches from one area to the next, among others.
While experts have suggested that storefront access has everything to do with sales, that trend cannot be observed in all provinces. It may be true for Alberta, which opened 101 stores between March and July 2019, and in Ontario, where a noticeable jump in sales can be observed when a wave of stores opened there in April 2019.
But in B.C., the province with the second-highest number of retail stores in Canada at 57, sales have remained low.
By using a population-weighted average distance, the report found that 45 per cent of Canadians live within 10 kilometers of a cannabis store. Residents in Prince Edward Island travelled an average distance of 12 kilometers to their nearest store, with Alberta ranked second (13 kilometers). B.C. showed the greatest reduction in average distance over time (57 kilometers down to 24 kilometers between March and July 2019).
While each province and territory offers access to cannabis through an online portal, and online sales were stable, the share of online sales dropped considerably as more brick-and-mortar stores opened. In October 2018, online sales accounted for 43.4 per cent of sales, but by September 2019, that number dropped to 5.9 per cent.
Overall, the report shows that despite challenges, Canadians’ appetite for cannabis is increasing (even if B.C. is set on being the hold-out). The report included no information regarding the sale of cannabis on the illicit market.
This article is available under a Canadian Creative Commons license.