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This article was published 25/2/2019 (399 days ago), so information in it may no longer be current.
Provinces with a higher proportion of licensed bricks-and-mortar cannabis stores are selling considerably more cannabis per capita than provinces with less storefront access to legal marijuana, says a Brock University professor who crunched Statistics Canada's latest retail trade data for cannabis.
The December data show that $55.2 million worth of legal cannabis was sold in Canada, a 3.7 per cent increase over November's sales.
"It's quite reasonable, respectable progress, but it's not dramatic progress towards the government's policy goal" of supplanting the black market cannabis economy, said Michael Armstrong, an associate professor of operations research at Brock University in St. Catherines, Ont.
To illustrate his point, Armstrong compares December's retail cannabis sales in Quebec (about $12 million) to sales in Nova Scotia (about $6.4 million). Both Quebec and Nova Scotia currently have twelve cannabis stores each.
"Quebec has almost double Nova Scotia's sales, with the same number of stores… (but) Quebec's population is 8.4 million, Nova Scotia is just under one million," explained Armstrong.
"So if you look at the sales per capita, Quebec had $1.43 average sales per person in December, but Nova Scotia had $6.69," he said.
"That's suggesting Nova Scotia's actually doing four times better at starting to eat away at the black market. Or if you want to go from the business perspective, they're doing a four times better job at actually serving consumers, making the product available."Advertisement
In Ontario, where licensed bricks-and-mortar cannabis stores have yet to open and a provincial website remains the only way to legally access recreational marijuana, December retail cannabis sales were just $8.7 million. Consumers in British Columbia, the third most-populous province in Canada, bought a paltry $1.2 million of legal cannabis in December — almost as much as consumers in Prince Edward Island, the least populous province.
Armstrong described his analysis as a preliminary one, since it doesn't factor in provincial variables like local cannabis consumption habits, price differentials and the proportion of a province's population that's actually of legal age to buy cannabis.
But a high-level scrutiny of the data still suggests the leading factor in how much legal cannabis is sold in a province is simply the number of retail store locations, Armstrong argues.
Other data points lend support to his hypothesis.
Statistics Canada's latest National Cannabis Survey asked cannabis purchasers to choose up to three "main factors" they weighed when deciding to buy cannabis. "Accessible when I want" and "location" were the third- and fourth-most cited options, chosen by 33 per cent and 28 per cent of respondents, respectively. Only "quality and safety" and "lowest price" were ranked as more important factors.
In New Brunswick, first quarter sales at provincial retailer Cannabis NB earned $8.6 million in revenue. Just $400,000 of that revenue came from online sales, or 4.6 per cent.
Provinces with fewer physical stores per capita like Ontario, Quebec and B.C. simply need more licensed storefront locations if they want to catch up to the provinces that are leading the way in legal cannabis sales, said Armstrong.
"Yes, product shortage is a concern, but they need more stores to make any headway," he said.
Ranked in dollar terms, Alberta consumers bought the most cannabis in December ($13.6 million). That's followed by Quebec (about $12 million) and Ontario (about $8.7 million). Nova Scotia came in fourth place, selling $6.4 million dollars worth of legal weed in December.
December retail cannabis sales figures for the remaining six provinces rank as follows:
Yukon led cannabis sales among Canada's three territories, with Yukoners buying $403,000 worth of cannabis in December. Shoppers in the Northwest Territories bought $205,000 worth of cannabis. Statistics Canada did not publish December cannabis retail sales figures for Nunavut.