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What’s Happening at the Ontario Cannabis Store?

As a way to stay connected to customers, Ontario Cannabis Store (OCS) Chief Commercial Officer Cheri Mara sat down on 4/20 to answer questions in a Reddit Ask Me Anything session in their online community r/TheOCS.

The community is often monitored by the OCS for customer feedback, but members jumped at the chance to speak directly to Mara. The post garnered nearly 300 comments, and customers asked questions on everything from pricing discrepancies to Mara’s first time consuming cannabis–it was while listening to Simon & Garfunkel’s Cecilia, in case you were wondering. Mara shed some light on price, product, craft growers, and more.

Prices

One of the most commonly asked questions was from Ontarians wondering why products in Quebec were so much cheaper. According to Mara, while provinces are not interested in competing with each other on prices, they do keep an eye on country-wide prices and adjust accordingly. She said, at the end of the day, pricing comes down to the consumer’s perceived value of the product, which is not easy in a new marketplace, especially when strictly tested and environmentally controlled cannabis isn’t always directly comparable to the legacy market.

When the OCS receives each cannabis product from the producer, they set the price based on how the product was grown and what goes into it. Retail stores in Ontario then purchase the product wholesale at a fixed markdown from the prices on the website, and set their prices accordingly.

“We know more prices will decrease in the future with more efficiency being achieved in the marketplace.” Mara says, but acknowledges that the quality has to improve as well. “I can tell you, every one of our producer partners is focused on improving quality–but with a natural agricultural product like cannabis, it can sometimes take months, not weeks, to see changes on retail prices.”

She said they aim to provide competitive prices to combat the illegal market, but that their profits contribute to good causes too, like education that promotes social responsibility and de-stigmatizes cannabis consumers. By contributing to important provincial services as a Crown Corporation, it also helps keep broader taxes and increased provincial spending lower.

Products

Judging from their comments, customers are excited and interested in new Cannabis 2.0 products as well as growing their own cannabis. According to Mara, customers can expect new products like live rosin and bubble hash, seeds, and even clones, however, the latter pair are difficult to source.

Other questions about products were based around product quality and packaging.

Overly dry and old flower is a common complaint among consumers, and Mara acknowledges that. To combat this, they’ve implemented a policy to ensure that all products shipped to them are packaged within the last three months, but it may take some time for customers to notice as they work through their remaining inventory.

“There is a learning curve when it comes to growing and packaging products at the scale needed to supply the Canadian market,” Mara explains, “Since legalization, producers have been experimenting with different types of packaging to better lock in moisture, as well as different methods to dry and cure fresh flower before packaging.”

Packaging has been getting an overhaul in other areas, too. Mara says they are constantly working on displaying more accurate THC percentages, as well as making packaging more environmentally friendly.

According to Mara, in the rush to legalization companies were only looking for packaging that they knew would be child resistant and quick to produce, not necessarily the most environmentally friendly. Now that the dust is starting to settle, though, they are looking at ways to reduce their footprint and packaging waste, such as recyclable paper-based packaging, in-store recycling programs, and changing their policy with producers, requiring them to ship with less extra inner case packaging.

Craft Growers

When The OCS recently hired Peter Shearer, a long-time veteran in the cannabis space, one of his first duties was to draft a framework for craft cannabis growers in Ontario. Mara says that this framework will start with a clear definition of what craft means in their specific market that goes beyond marketing and actually reflects the roots of craft cannabis growing.

There is no official timeline as of yet, however, farmgate stores could show up sometime this year. Farmgate stores are retail shops that operate on the same property as the farming facility. The province confirmed that the OCS will continue to be the exclusive wholesaler for recreational cannabis in Ontario, however, they have been working with a few licensed producers that would like to launch a farmgate store at their facility.

Industry Growth

As an industry, cannabis is always growing, and the OCS is working to stay ahead of the curve. Looking at other models like California and Uruguay is important, but according to the OCS, so is hiring a diverse background of employees who understand the legacy market, retailers and information technology.

Mara says, “All these voices coming together is what is going to help us learn from our mistakes quickly and improving the marketplace for consumers. Our goal is to be leaders, and that requires learning from others as well as being brave in trying new things.”

Now that the AGCO is resuming issuing retail store applications, dozens of new shops could be popping up in the coming months. Mara says that the main goal is to provide access to legal cannabis products for all Ontarians in all corners of the province, both in store and online.

“Legal cannabis is a process that takes time to get right,” she says, “As we learn more along the way,  we expect governments will evolve their regulatory frameworks. And we expect customers will keep telling us what matters to them most.”