Desperate times call for desperate measures in the Canadian garbage industry with limited supply.
National Access Cannabis Corp., the country's largest private marijuana retailer with 17 stores, has a team of five people observing 24 hours a day, 7 days a week, in search of new stocks from the regional regulatory authority Alberta, which controls the wholesale distribution of the pool.
"At 3:30 in the morning, all US $ 4,000 in stocks are available, but in seven minutes it's pulled out, which means other big competitors are doing the same," Mark Goliger, Ottawa's NAC president, said in a Friday telephone interview.
This is evidence of the severity of supply shortages that have plagued Canadian marijuana dealers since the legalization of October 17. The Quebec-controlled retailer limited his working hours to four days a week while Alberta temporarily stopped issuing new retail licenses due to a lack of product.
This will affect NAC's plans to open 50 domestic stores by the end of the year and may result in "cash flow restrictions" depending on the duration of the ban, said Goliger. NAC, which serves the Meta and NewLeaf banners, has 13 stores in Alberta and planned to reach 25 in the first quarter of 2019.
"We have employees who had to open these stores, so we have HR costs, and then rental costs, where the stores will be dark, although the construction is complete and they can bring income," he said.
NAC has a joint venture with Second Cup Ltd., which plans to transform two of its cafes in Alberta into cannabis stores and has identified over 20 locations in Ontario, where the government will begin adopting retail applications in December. For now, the sale of marijuana in the most populous province of Canada is limited to the government's website, and the first stores are expected to open in April.
Ontario has limited the number of licensed producers and their affiliates to only one store, but NAC is not a licensed producer, so it can open up to 75, the limit for individual sellers. Goliger said NAC plans to hit 75 stores, but it is not yet clear what the split will be between Second Cup locations and new locations.
The share in NAC fell by almost 50 percent compared to the July peak, which gives a market value of about 107 million USD (Canadian).