Canada legalized the recreational use of pot in October 2018, and there was an initial rush to enter the market. Early reports were that a lot of start-ups, and even the Ontario government, lost money on the business, and that the sheer number of stores opening was going to lead to “closures and market rightsizing” (according to the CEO of the province’s pot distributor in 2020).
I don’t know what the state of the green economy currently is, but I haven’t noticed any closures in my community. In fact, dispensaries continue to be built. There are at least nine now within walking distance of my house, and 26 are listed in the city of Guelph.
That’s a lot of pot stores! This leads me to wonder just how much money there is in the recreational cannabis business. Are most of these places going to go bust? What are the profit margins? And how many pot smokers are there out there in the first place? Has pot use gone up since legalization? I don’t even know anyone who still smokes cigarettes anymore. I’m sure there is a market, but is it big enough to keep all these places in business? And who is the average recreational cannabis user? Blue collar, white collar, student? The presence of so many stores gets me thinking about these kinds of questions.