COVID-19: Sales spike at Canadian cannabis stores

Canadians are stocking up to cope with the anxiety of the coronavirus pandemic, industry watchers say

A long line of customers wait outside Tokyo Smoke's Yonge Street store in Toronto on March 17, 2020. | Credit: Nick Lachance

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On March 17, Ontario Premier Doug Ford declared a state of emergency to help flatten the spread of COVID-19.

But amid the coronavirus outbreak, Canadian cannabis stores are seeing a spike in sales.

Global News first reported that 3,000 orders were placed to the Ontario Cannabis Store on March 14, an 80-percent increase over a typical Saturday. Meanwhile, Société québécoise du cannabis told Canadian Press that sales were up in the wake of the pandemic, but did not give specific numbers.

The cannabis retail market has grown considerably since legalization. Sales have brought $908 million to online and brick-and-mortar retailers, according to Statistics Canada. However, the general consensus is that sales for the market seem to lag behind what was originally projected.

Given the layoffs that hit the cannabis sector in February, many licensed producers are still trying to figure out the size of the retail market and how exactly the regulatory systems work.

While an increase in sales makes sense against a backdrop of panic buying – groceries, toilet paper, hand sanitizer, and respirator masks – others believe cannabis sales went up for other reasons. People are turning to cannabis products such as flower, edible, and vape products to help with anxiety, insomnia, pain, and headaches.

“What we’re seeing is the showcase of how much of an essential product cannabis is right now,” explains Sarah Seale, chief executive officer at Seale & Garland Consultants in Ontario. “People are scared that they are not going to be able to get their products and be able to use them.”

For medical cannabis users, medicine is an absolutely crucial part of their day.

Deepak Anand, chief executive officer at Materia Ventures in British Columbia, agrees with Seale.

“There are certainly some people that are stocking up,” he says, adding that when times get difficult people tend to turn to alcohol. “There is an element of that here with cannabis, as people might be looking at this as an intoxicant for whatever reasons.”

Anand believes both medical and recreational users are stocking up, but they are also purchasing in a heightened emotional state, since times are tough.

As public-health officials encourage social distancing to flatten the curve of coronavirus spread, many have turned to online delivery services to get cannabis.

Daffyd Roderick, a spokesperson for the Ontario Cannabis Store (OCS), told Global News that over the last three days, the retail platform has seen an increase in the total volume of sales and a high demand for same-day and next-day delivery.

For many medical cannabis users, cannabis delivery is the difference between getting their medicine that day or not.

“Whether people call themselves recreational users or medical users, the fact is, a majority of people who are using aren’t just sitting around looking to get high,” says Seale. “They’re using it for very specific needs and they want to make sure that they have a good stock.”

The OCS ships products by Canada Post’s standard delivery service with a $5 flat rate, but people can look into Pineapple Express Delivery, which offers same-day delivery of medical and recreational cannabis through select licensed producers.

As the spike in sales continues, one question that has come up is how the coronavirus pandemic will affect the supply chain.

Many companies have had to consider the impact of social distancing and what that would mean for cannabis production in general. Anand believes that for the time being the industry won’t see that large of a disruption.

However, he adds, “I can’t see how it’s not going to have an impact on the supply chain in the long run.” 

Although the spike in sales is indeed positive, it raises more questions: How can licensed producers continue to cultivate safely through this pandemic, and will they be able to keep up with supply anddemand? If anything, coronavirus has exposed the fragility of the supply chain.

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