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Tuesday, Aug 16, 2022
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.


Weed delivery coming to BC in July, but not all retailers sold on the idea

Some retailers are excited by the added stream of revenue, while others worry about potential negative pressures on price

Weed delivery coming to BC in July, but not all retailers sold on the idea
Licenced stores in B.C. will be able to deliver weed starting July 15. Photo by Jared Gnam

Packaged as another way to encourage legal cannabis, British Columbia’s government will allow licensed sellers to drop weed off at the door starting next month.

At the same time, the province also eliminated security verification requirements for cannabis workers.

Stores can start sending out staff by bike, car or foot with weed, as long as it’s secured, to customers 19 and older beginning July 15.

Employees will need to carry a cannabis retail store (CRS) licence and customers will need to give their names and sign for the delivery.

“Allowing direct delivery to consumers isn’t just an advantage retailers have told us is vital to the viability of their sector, it’s also a way we can further our public safety goals,” Public Safety Minister Mike Farnworth said in a statement.

Farnworth recently urged British Columbians to stick with legal sellers after a provincial testing pilot found multiple contaminants in illicit weed.

While some retailers express excitement for the added revenue boost it will bring, others worry adding delivery will start a race to the bottom as consumers search for the lowest-cost options.

Read more: BC focuses on cannabis enforcement as illicit market shrinks

Read more: Testing pilot finds multiple contaminants in illicit BC bud

‘Even the playing field with the illicit market’

“Tremendously excited,” is how Harrison Stoker, chief growth officer for Dutch Love — part of pub proprietor Donnelly Group — describes his reaction to the announcement.

All six B.C. stores will start delivering as soon as the rule comes into effect, he says, admitting that a year ago would have been ideal for starting the program due to the pandemic.

He reiterates delivery is something the industry has been asking for and looks at it as an opportunity to drive economic stimulus, as well as a tool to “even the playing field with the illicit market.”

Kiaro is also working on implementing a delivery service as soon as it can, COO Eleanor Lynch tells Mugglehead in an email.

“While the policy is not perfect, it is a step in the right direction,” Lynch adds.

Costs of weed delivery could hike prices

While there is excitement swirling for some, Evergreen Cannabis co-owner Mike Babins worries about the long-term consequences, especially if smaller stores are forced to compete for lower prices.

“I think it’s going to hurt stores more than help stores long-term,” he tells Mugglehead by phone.

“If I’m calling for delivery, I’m going to get it delivered from whichever store is charging the cheapest, which forces every store to lower the prices as much as possible.”

Babins points out the added costs that will come with hiring a delivery team and having insurance.

“In reality, I can’t see anyone actually being able to do it, except the big stores.”

Evergreen Cannabis co-owner Mike Babins

Evergreen Cannabis co-owner Mike Babins isn’t solid on delivery just yet. Photo by Nick Laba

Stoker doesn’t anticipate the same issues when it comes to assembling a delivery team.

With some stores in Ontario, Stoker says his company already has a “knack” for delivery and how it resonates with customers, “especially customers that might have accessibility issues in being able to get to brick and mortar locations.”

Read more: Ontario weed stores open to customers as future of delivery uncertain

Read more: Delta, BC moves to public hearing for first weed store

However, Babins sees delivery as potentially opening a door for larger corporations like Amazon to one day enter the industry and eventually price out smaller businesses. For the time being, deliveries can only be made by those with CRS licences.

Stores must be responsible for the deliveries, meaning no third-party delivery services like Uber or Lyft will be in B.C.’s legal weed business.

Right now Babins says his prices are beating out the illicit market, but they might need to increase to make up for a delivery team. He’s weighing his options before deciding if delivery is worth it.

BC removes security verification for quick hiring

Security verification requirements for cannabis workers are being removed to eliminate hiring delays and allow retailers to implement delivery quickly.

Lynch from Kiaro commends the province for dropping the security verification, “which stigmatized cannabis employees and charged them over $100 to start work in the retail sector.”

BC amends regulations to allow online cannabis sales for pickup

Kiaro near Commercial Drive in Vancouver, B.C. Submitted photo

“We applaud the B.C. government for taking a progressive stand on these issues, and positioning B.C. as the leader in the cannabis industry, one of the top-performing economic drivers in Canada,” Lynch adds.

The provincial government will reimburse employees who paid the $100 and haven’t received their verification yet.

More than 7,000 cannabis workers have been screened since 2018 without any significant risk or links to organized crime, according to the province.

B.C. weed stores were given the green light to sell their products online for curbside pick-up last August. The province said it was considering proposals for delivery at the time.

In-store purchasing rules apply for delivery, including a maximum of 30 grams of dried weed or equivalent per transaction. Deliveries can only go to residential addresses.

Read more: BC amends regulations to allow online cannabis sales for pickup


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