Pot brands race to retail front line for edge in competitive cannabis landscape
TORONTO — As the race to produce enough cannabis for the soon-to-be-legal market gets increasingly crowded, licensed producers are setting their sights on the next frontier in the race for maximum pot profitability: developing retail stores.
Pot producers have been ramping up production in preparation for the legalization of marijuana for recreational use later this year and — realizing there is a healthy collective pipeline of product coming online over the next few years — are looking to deploy their cash in more profitable ways, said Russell Stanley, special situations analyst with Echelon Wealth Partners.
Retail is high on their priority list, said Stanley. He points to cannabis dispensary operations south of the border, which offer a direct connection to the consumer through “budtenders” who personalize the potentially overwhelming experience. Such vertical integration also serves to gives their products a competitive edge.
“That is no doubt something that Canadian producers are seeing as a motivation for getting into distribution,” he said. “Because the closer they are to the buyer, the stronger their competitive position may be.”