• Record cannabis store closures
  • Record cannabis store closures

Fermetures record de magasins de cannabisCanada

Publié le 8 février 2024 par AQIC

A record number of cannabis stores in Canada might have closed or changed hands in 2023, according to new data from regulators in the three largest Canadian marijuana markets.

The data paints a picture of a viciously competitive retail landscape in some parts of the country, while other areas appear to remain in a steady build-out phase.

MJBizDaily asked regulators for data about cannabis retail license cancellations and new licenses issued in Alberta, British Columbia and Ontario, which together account for nearly 75% of regulated marijuana sales in Canada.

The number of cannabis retail licenses that were canceled or not renewed in Alberta during 2023 exceed the number of new store licenses issued – the first time this has happened in the province since Canada legalized marijuana in 2018.

In 2023, 62 cannabis store licenses were canceled or not renewed in Alberta; meanwhile, 48 new cannabis store licenses were issued.

The previous year, Alberta regulators issued 140 new store licenses compared with 73 licenses that were canceled or not renewed by license holders.

The data paints a rough picture of store closures.

Provincial regulator Alberta Gaming, Liquor and Cannabis (AGLC) cautions against drawing a direct line between a store canceling a license and the store exiting the industry, citing several other possibilities, including relocation.

Alberta currently has 749 cannabis providers, and the province is thought to be Canada’s most mature marijuana retail market.

Matt Maurer, chair of the Cannabis Law Group at Torkin Manes in Toronto, said it makes sense to see the number of new store licenses fall in a market such as Alberta, which already is well established.

In a phone interview with MJBizDaily, Maurer said he’s curious to see when the Alberta market will settle into a natural balance between supply and demand for open stores.

“As long as the cancellation number stays high, to me that says there’s still an imbalance. At some point, you should see minimal cancellations – a few a year – and that would be for reasons specific to the stores, not the industry in general,” Maurer said.

“Until we see those numbers drop further on the cancellations, it’s still a sign there’s oversaturation.”

Ontario applications drop

In Ontario, the largest cannabis market in Canada by sales, the number of new store applications has declined every year since 2021.

In 2021, just over 1,000 Retail Store Applications (RSAs) were issued, reflecting high entrepreneurial enthusiasm for the burgeoning industry, according to data shared with MJBizDaily by the Alcohol and Gaming Commission of Ontario (AGCO), the provincial regulator.

The following year, the number of RSAs in Ontario dropped by more than 50%, to 429 new RSAs, before falling again in 2023 to 269.

License cancellation numbers haven’t risen as quickly.

In 2021, eight RSAs were canceled.

The figure grew to 106 in 2022 and then fell to 92 in 2023.

The data suggests there are still more stores entering the Ontario market than there are exiting.

Krista Raymer, founder of Toronto-based cannabis retail consultancy Vetrina Group, noted that new municipalities in the province opened their doors to legal cannabis stores in 2023 after previously having “opted out.”

“You wouldn’t see that store growth number if it wasn’t for the fact that communities went from ‘opting out’ to ‘opting in’ (in 2023) to the regulated cannabis market,” Raymer told MJBizDaily.

Mississauga, the sixth-largest Canadian city by population, reversed its cannabis store ban last year.