New Brunswick will be privatizing its public cannabis retail stores after one full year of unjustifiable losses.
Finance Minister Ernie Steeves announced Thursday the province is seeking a single private operator to take over Cannabis NB‘s operations, distribution and sales.
The province will be looking for applicants with experience in recreational cannabis sales; the financial capacity to develop and sustain operations; and a robust plan to compete with the black market, Steeves said in a live-streamed press conference following the announcement.
“Governments shouldn’t be in the business of business, we should be in the business of regulating. We’ve proven we can’t run a business the same way you run government,” he added. “If you have a private business you consult with yourself, maybe your share holders and maybe your partners within the business and take action within 24 hours or 72 hours or a couple weeks. That’s not the way government works.”
The province will be accepting applications until Jan. 10, 2020.
Business as usual for Cannabis NB
Health Canada’s strict regulations hindered the success of Cannabis NB, says N.B. Finance Minister Ernie Steeves. Photo courtesy of Cannabis NB
All 20 Cannabis NB locations will remain open and it’s business as usual in the meantime, Steeves said.
It’s too early to talk about possible employee severance or if locations will close, he added, but it would be unwise for a business to come in and fire all of the knowledgeable 250 staff already employed.
The new business will be completely autonomous and free to raise or lower prices, open or close any of the 20 locations and stock the products of its choice.
The Crown retailer bled almost $12 million during the first six months of operations, which prompted the government to consider alternatives to the public model, Steeves said.
The government was considering either closing seven of its least profitable stores, selling the business completely to the private sector or accepting applications for a sale to the private sector like they are now. The latter was agreed to be the best option for taxpayers.
Steeves was critical of Health Canada’s regulations and said the federal body doesn’t want the cannabis industry to succeed.
One sticking point for Steeves was how Cannabis NB was not allowed to have photos of people smiling or using cannabis on their website, pointing out how many private companies get away with sharing images of happy stoned people.
