RE:RE:Hello LaThongPrices offered to consumers in the US are substantially higher than those in Canada for the same product while the margin numbers are similar. This indicates to me that there are inefficiencies within the business operations of US MSOs.
While there is competition in the US it is not high enough at the moment to motivate lower prices therefore inefficiencies are allowed to continue.
Once legalization kicks in there will be an influx of new cannabis companies starting up, expansion of existing companies and Canadian operators establishing substantially larger sales channels within the US.
These changes will invoke price compression and lower consumer pricing however the margin compression will test the skills of US MSOs. Their management teams will likely not respond fast enough nor properly to manage both expansion and operational efficiencies at the same time.
What I am noting here is not something that will play out over weeks or months but rather in years however it is another reason why I prefer Canadian operators as they are battle hardened.
I'll pick a beaten up fighter that has survived years of battles over a player who has never had as much as a blooded nose before.
Markets are brutal, I'm betting on a proven survivor - TLRY
JMHO