When recreational cannabis is legalized in Canada — as it’s expected to be later this year — will you buy yours from a retail storefront or the black market? And will you make that purchase from a dealer, or a sort of “pot sommelier?”
That largely depends on what you want from your pot-consumption experience, according to people CBC News has spoken with who plan to be part of Manitoba’s marijuana market.
Delta 9 Cannabis, for example, plans to dive into the recreational marijuana market by opening its first made-in-Manitoba store just two floors down from its current medical cannabis clinic, in the heart of Winnipeg’s Osborne Village.
“We’re really trying to focus on promoting the fact that Delta 9 is a Winnipeg/Manitoba success story,” said Marshall Posner, vice-president of sales and marketing at Delta 9 Cannabis.
“We were the first licensed producer in Manitoba. We’re still the only licensed producer that has a Health Canada licence to not only cultivate, but also sell.”
In February, the province announced four private companies or consortiums that will retail cannabis in Manitoba. Manitoba Liquor & Lotteries will secure the supply of marijuana and track it, but private retail stores will be in charge of selling it.
Posner says Delta 9’s retail storefront will do what traditional marketing schemes cannot.
Health Canada is strictly regulating the advertising and promotion of cannabis products, which means consumers won’t see cannabis on billboards or anywhere else where minors can view it. It leaves retailers with some online marketing opportunities, but promotions will mostly come from within the stores themselves.
“We’re going to have a sensory bar so people will be able to walk up, they’ll be able to actually look at the product, they’ll be able to smell it … and then we’ll certainly be allowed to tell you how you’ll feel,” said Posner of the 20 different strains of cannabis the company currently produces.
‘Help people understand the plant’
Helping customers understand how different products might make them feel is a focus for storefront retailers, says another of Manitoba’s licensed retailers.
“We’re here to help people understand the plant better, but also at the same time clear up any misunderstanding or misinformation around it,” said Evan Loster, business process analyst for National Access Cannabis, which also holds one of four retail licences in Manitoba.
For Loster, the best way to understand cannabis is by its terpene profile. Terpenes are compounds that exist not just in cannabis but in other plants, which has given science some understanding around how a particular terpene might affect the body.
“Is it going to help with pain, is it going to ease anxiety, is it going to help with insomnia? It’s the terpenes that are determining that. The cannabinoids as well, but metaphorically the cannabinoids are more of the engine of the strain, where the terpenes are the steering wheel,” said Loster.
Terpenes add to the complexity of cannabis, which can already be confusing for consumers dealing with the cannabinoid profiles and the particular strain of cannabis.
Cannabinoid profiles indicate the level of compounds such as tetrahydrocannabinol (THC) and cannabidiol (CBD). Those profiles help to identify the strain of cannabis, which can be an indica, sativa or a hybrid strain.
All these factors combined help determine how much a product will either elevate your mood or send you into couch mode.
From wine to weed
We’re still waiting to see who will take the lead as educators in this new market, but some in the wine industry say they are up to the task.
That means Manitoba could soon be home to not just wine reps but a number of cannabis reps.
“We have a lot of experience handling controlled substances and dealing with liquor boards across all 10 provinces,” said Lisa Campbell, cannabis portfolio specialist for Lifford Cannabis Solutions, a subsidiary company of Toronto-based Lifford Wine and Spirits.
“Now that cannabis is being regulated similar to alcohol, there are a lot of parallels in terms of the supply chain and the services that producers will need getting to market.”
All marijuana sold in Manitoba will first go through Manitoba Liquor & Lotteries, but as the number of licensed producers expands and products diversify, Campbell says there will be demand for a cannabis rep service to help link retailers with producers.
“There are so many products that are on the existing grey market which haven’t been approved yet by Health Canada so we’re really hoping that as we move towards product diversity, especially Year 2 of legalization, that all these products will be available — from dried flower and oils currently to in the future hopefully vape pens, as well as edibles and beverages,” said Campbell.
The black market
When it comes to product knowledge, some of the people who know the most are those who have been selling pot for decades in the black market.
Over time, black-market products have diversified, and will likely differ from what’s available legally.
With the proposal of the licensed producers at $10 per gram … I find they’re pricing themselves out of the market
– ‘Jeremy,’ a black-market dealer
“People are much more knowledgeable about what they want and how they want to use it, and they want different ways to consume cannabis,” said a black-market dealer who CBC is calling Jeremy to protect his identity.
“The vapes are very popular and a little more discreet … and a lot of the medical industry is looking for the concentrated oils,” he said.
Jeremy says 80 per cent of his clientele are using cannabis for medical reasons but are obtaining it illegally because they desire a concentrated product with potencies above what is permissible under Health Canada regulations.
Price could also play a role in keeping customers in the black market. The federal government’s proposed price of $10 per gram for marijuana from licensed producers was intended to be competitive with street prices and drive out the black market.
Data collected by Health Canada suggests Canadians currently pay between $5.88 and $7.75 per gram, depending on quality and whether they obtained it through legal or black-market channels. Jeremy says the average street price in Winnipeg is $6 per gram.
“Street value, nobody’s out there to make any corporate money. The market price has been set over how many years … and with the proposal of the licensed producers at $10 per gram with no other cuts or discounts on larger amounts, I find they’re pricing themselves out of the market,” he said.
Jeremy believes the black market will continue to thrive, but it’s the licensed producers and retailers that stand to make the most money. Early estimates have revenues in the recreational marijuana market in the billions, which is good news for those with government retail licences.
“We really don’t anticipate there being slow periods or lulls in any of the stores, province wide,” said Delta 9’s Posner.