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BC has a long way to go create a thriving cannabis industry

Media Partners, Stratcann

This post is presented by our media partner Stratcann
View the original article here.

Shannon Ross has an idea to make BC cannabis the talk of the town again.

The once notorious province could get some of its edge back by letting people enjoy cannabis together in public, just like you would consume craft beer.

“I think the most effective thing we could do to get back on the stage and become a powerhouse, not only in British Columbia, but the whole international scene, is consumption spaces,” says Ross, co-founder of Antidote Processing in the Kootenays. “That would be a game changer.”

We’re not a financially successful industry for the majority of small businesses right now. We have our hands tied behind our back trying to create legal cannabis businesses.

Shannon Ross, Antidote Processing

Ross wants to know how the BC government plans to support consumption spaces. She says one of the biggest hindrances right now is the inability to get together and use cannabis socially. Ross wants public cannabis spaces to be similar to finding a place to enjoy a pint with pals. There’s still too much stigma around cannabis, she says.

She suggests creating farmers’ market-style gatherings as a valuable way for consumers to meet farmers, especially with the limitations placed on advertising.

“The marketing restrictions are so challenging on a federal level that the BC government could facilitate that consumer-grower connection and allow some marketing efforts to happen in a way that’s conducive to finding balance,” she says in an interview with StratCann.

There has to be a happy medium that encourages a certain level of responsible education and marketing, she adds.

“It’s really about connecting people and allowing them to consume,” she says, adding that even the big conferences are fading now.

Still, there are things that BC is doing well to set the stage for long-term relevance, namely farmgate and direct delivery. Ross calls them both tools for proactive change, but there are barriers to taking advantage.

The 15% markup on direct delivery products erodes the incentive, and getting retailers on board can be pretty tricky, she says. Also, there are extra expenses tied to both direct delivery and farmgate that cannabis businesses simply can’t justify.

“It takes a ton of resources that we don’t have yet,” says Ross. 

“Right now the industry isn’t mature enough. We’re not a financially successful industry for the majority of small businesses right now. We have our hands tied behind our back trying to create legal cannabis businesses.”

On the bright side, Ross says the provincial government has been receptive and is showing some curiosity toward cannabis by attending industry events. She says they are hearing the voices of craft growers and adapting.

She argues that the federal government is the biggest problem, particularly the excise tax. She says that until the excise tax is reduced, people won’t jump on these programs.

“The biggest challenge is access to capital in order to meet a lot of the regulatory requirements. Banks don’t want to loan very much and there’s still so much stigma, just being able to have a low interest loan… even access to $25,000. A lot of people aren’t even able to transition to legal because there’s no access to capital.” 

Kyp Rowe has a bit of a different perspective on which level of government is the most significant hindrance.

“The base hindrance is the province,” says Rowe, president of Victoria Cannabis Company (VCC). “Everybody wants to scream and yell at the feds with their excise tax, Health Canada, this, that, and the other thing. The biggest assholes in this entire industry are the provinces. The fact that they are quadruple-dipping into our pockets is making this entire industry unsustainable.”

Rowe lists the PST, GST, 15% direct delivery markup, and the province’s monopoly over the wholesale game.

“The whole thing is doomed to fail and to crush the small producer.”

While the Direct Delivery Program is a great start—“I love it,” he says—the 15% markup is aggravating. “I move my weed 30 feet into my farmgate store and I’ve got to cut them down 15%? That’s fucking ludicrous,” says Rowe.

“The Direct Delivery Program in totality as far as the rest of Canada is concerned is extremely progressive. It’s a way for the producers to make direct connections with the retailers without having the province right in the middle of it, mucking up the waters.”

Rowe also applauds farmgate but says it won’t benefit many BC producers.

VCC is only the third company to get its farmgate licence since the program came into effect over a year ago. He blames the low uptake on locations, as many facilities are in industrial parks or remote areas that don’t get much traffic. Conversely, VCC is located minutes from downtown Victoria and has 44,000 cars going past it daily.

Rowe says BC’s Liquor and Cannabis Regulation Branch made the process of getting its farmgate licence easy. 

It was the City of Victoria that dragged their feet. He says it took a year to get on the city’s docket for rezoning as they kept getting bumped from the agenda. Then, in order to get approval, VCC had to pay $60,000 for a sidewalk, which cut down its parking availability.

“We had to harass the city.”

“Three levels of government you have to deal with in the cannabis industry. They don’t talk to each other. We don’t have any power. To effect change is almost impossible.”


~David Wylie. David is a writer, father, and founder of The Oz., which covers cannabis from a consumer perspective.

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