Ontario’s “pot shop lottery” has been met with a less-than-stellar success rate, but the province is taking a new approach aiming to turn things around.
An “open allocation” system to issue licenses is being proposed for next year, which would allow potential store owners to just apply online and pass a series of background checks to sell legal cannabis at the brick-and-mortar retail level.
There are only 24 cannabis stores that are currently operating in Ontario as well as the government-run online store, very few when compared to Alberta, where there are more than 300 cannabis stores open.
This could be a massive move for the province, with a ripple-effect for the rest of the country’s industry.
Via Bloomberg:
Cannabis sales in Ontario have totalled $185 million in the first 11 months of legalization, the most in the country, according to Statistics Canada. However, the province has lost out on $325 million in economic activity and approximately $50 million in tax revenue by not having as many pot stores as Alberta, according to analysis by The Cannalysts Inc., an independent cannabis research firm.
“We’re looking at getting back to the easiest, fastest way to the open allocated model that we considered to be the ‘gold star’ plan,” the person said.
A decision could be reached “in the coming weeks”.
Canadian cannabis shares seemed to respond well to the news, with Aurora Cannabis Inc. (TSX: ACB) rising more than 20% in early trading to over $4 on Thursday, followed by Canopy Growth Corp. (TSX: WEED) up more than 20% to sit over $28.
Cronos Group (TSX: CRON) gained upwards of 15.6% to $10.55 while Tilray (NASDAQ: TLRY) was up past 9.4% to nearly $23.
For more on this story, click here .