Vancouver is the final nation to have authorized hashish spending per capita in main Canadian metropolitan areas

Vancouver, British Columbia had the lowest per capita spending on legal adult cannabis products among Canadian cities last year. This is based on data from Statistics Canada, which suggests the city still has a long way to go before regulated businesses can compete with the illicit products firmly entrenched in the market.

Legal marijuana spending in Vancouver metropolitan areas was Canadian $ 105.6 million ($ 85.5 million) in 2020, which averages just CA $ 38 per person. This is the lowest of the nine largest metropolitan areas recorded by Statistics Canada.

Edmonton led Canada in spending per person at CA $ 128.85, while Calgary was second at CA $ 99.61 per person. Alberta led Canada in the number of licensed cannabis stores last year.

Instead of data showing people in Vancouver use less cannabis compared to other cities, the data suggests that the unregulated market in the city on the west coast is, according to Colin Bambury, marketing director for retailer THC Canada in the south -Vancouver, continues to be much stronger.

“The obvious (factor) here is the entrenched old market. Everyone grows or has connections, ”he said.

The business has been around since 2016, however it switched to the fully legal market last year.

“The anecdotal thing is that many customers who come to the store are still their main source for buying cannabis in the old market,” he said, suggesting that BC customers are still experimenting with smaller purchases in the regulated market.

Sky high fees

Vancouver’s relatively slow start also reflects the limited number of provincial regulated stores open year round in the city, experts say, which in turn could be a function of sky-high business royalties in the city.

In February, Councilor Rebecca Bligh found that Vancouver’s annual fee of CA $ 33,958 for legal cannabis retailers was six times the business fee charged by Victoria.

According to Bligh’s request:

“The extremely high level of municipal company license fees for cannabis retailers is a significant barrier to entry for companies wishing to enter the legal market. This can create incentives for illegal activities, require additional enforcement and compliance costs, and increase the risk to the public safety and undermining the business of the legal entities that paid the exorbitant license fee. “

The city council unanimously supported the motion to review the fee.

The motion states that the review “seeks to better align it with other retail license fees in the city of Vancouver, and to assist businesses entering the legal cannabis retail market with recommendations that should take effect until the next business license fee renewal “.

British Columbia’s own statistics show that by January 2020, 33 cannabis business licenses had been approved or approved in principle in the Greater Vancouver / Sunshine Coast area, up to 47 by the end of the year.

By the beginning of April 2021, 84 branch applications had either been approved or approved in principle.

For comparison, Calgary and Edmonton had 148 and 120 regulated cannabis providers, respectively, as of April.

Opportunity knocks

The relatively small number of legal businesses in Vancouver offers cannabis entrepreneurs a chance – at least if excessive business fees are cut, experts say.

“There’s a great opportunity in this province,” said Jaclynn Pehota, executive director of the Association of Canadian Cannabis Retailers, a group of mostly independent marijuana retailers in British Columbia.

According to Statistics Canada, legal recreational cannabis products valued at approximately CA $ 105.6 million were sold in Vancouver last year.

Sales are expected to increase as new stores open.

“What we have to do is treat cannabis as an opportunity rather than a problem,” Pehota said. “We’re talking about an industry that represents billions of dollars in economic activity and tax revenue that we don’t track.”

Matt Lamers is the international editor of Marijuana Business Daily based out of Toronto. He can be reached at [email protected].

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