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The Downside to Integrated Stores

In most rural provinces and areas with a lower population, integrated stores present a solution to the “numbers” problem often plaguing retailers in the countryside, however, in Newfoundland & Labrador it back-fired for a few days.

From August 23 to 26, employees of Dominion grocery stores were on strike due to being without a contract for nearly a year after rejecting their new contract in October 2019. Normally, the C-Shops located inside the grocery stores work well—the cannabis retailer doesn’t have to foot a huge bill when the store may only get a small number of customers—but since C-Shop employees are Dominion employees and therefore under the same collective bargaining agreement, they walked off the job, too. A total of 10 C-Shops closed their doors for a few days, and those stores account for 40% of Newfoundland & Labrador’s cannabis retailers.

The Newfoundland and Labrador Liquor Commission (NLC) is responsible for licencing private retailers like the C-Shops in Dominion grocery stores, which has become the largest cannabis retailer in the province. Like other provinces, the NLC also acts as a public retailer, selling products online to the public.

While C-Shops and Dominion may have lost three days’ worth of sales, cannabis consumers didn’t seem to lose much access, as they decided to simply purchase their cannabis somewhere else. According to the NLC, sales in the online store surged 58% during the three days of the strike.

The moral of the story here is not to dissuade retailers from integrated stores, which seem to be working perfectly well, but to ensure the continued support of your employees and make sure you don’t hitch your wagon to someone who doesn’t support theirs.