HTTP/1.0 200 OK Content-Type: text/html Easy Money In Marijuana Retailing? Think Again, Expert Says
Pubdate: Sat, 17 Feb 2018
Source: Edmonton Journal (CN AB)
Copyright: 2018 The Edmonton Journal
Author: Gordon Kent
Page: A3


Panel warned of supply problems, tight margins

A Vancouver cannabis retailer whose company plans to open 10 Alberta
stores this year says anyone rushing into the field shouldn't expect
to find a pot of gold.

"People definitely see it as a potentially very profitable business,
or cash cow. It's not," Andrew Gordon, director of operations for Aura
Cannabis, said Friday following a panel discussion sponsored by the
Leduc Regional Chamber of Commerce.

"The margins are very similar to other retailers … There's (also) a
potential of real shortages facing our business right out the gate in
the first 18 months. We have seen that in jurisdictions down south."

Gordon, whose firm runs one Vancouver dispensary, said he was
encouraged by the store regulations the province unveiled Friday,
particularly such moves as not limiting the number of outlets and
allowing them closer to schools and other sites than on the West Coast.

The 250 shops the provincial government expects will be licensed this
year is far better than the 40 Ontario plans to open, he said.

With nearly 80,000 registered medical cannabis users in Alberta, he
expects an economic boom once a legal recreational market is in place
that he said could be worth $9 billion annually within three to five

However, fellow panellist Andy Ridge, executive director of policy for
Alberta's cannabis secretariat, said while economic development is
important, issues such as public safety are higher priorities.

"We put a framework out and then stand back and let business do what
business has to do."

Gordon said advertising restrictions and the stigma associated with
marijuana can pose challenges for retailers.

Aura tries to win public support by holding quarterly meetings with
nearby businesses and residents, and allying with local service
providers, he said.

"(We partner with) yoga practitioners or counsellors or a dietitian or
a meditation specialist, and through their own social networks and
channels we can get our message out about who we are and what we
believe in," he said.

"There's no doubt about it, if you're not creative and innovative, you
will not survive in any sector in general, but particularly in cannabis."

With Alberta's rules now clearer for landlords, his company expects to
sign leases over the next 30 days for the five stores each it intends
to operate in Edmonton and Calgary.

The federal government seems unlikely to meet its target of legalizing
recreational pot July 1 because of delays passing legislation in the
Senate, but Gordon said some Aura shops might open as education
centres until they can sell marijuana.

While many potential Edmonton retailers have their eyes on Whyte
Avenue and the University of Alberta district, U.S. data shows
suburban and rural dealers are seeing the most growth, he said.
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