Only 5 of 51 recreational cannabis stores open in Saskatchewan three weeks after legalization

Saskatchewan's marijuana business continues to be an uphill struggle for its retailers nearly three weeks after legalization.

Only five stores are currently open in the province. SLGA has issued permits to just nine of the 51 winners of the provincial lottery that decided who could open a recreational pot shop. 

David Morris with SLGA said there are a lot of pieces to getting that permit approved and that some are getting close.

"It's a big undertaking, there's work that a lot businesses have to do on their own, including getting municipal zoning approval and meeting any sort of requirements that municipalities may have. They also need to work on construction, securing the business, plus the SLGA permitting requirements," Morris said.

Supply chain problems causing store closures, high prices

Two stores with permits — Living Skies in Saskatoon and SpiritLeaf in Moose Jaw — have yet to open their doors. But two others  — Jimmy's Cannabis in Martensville and New Leaf Emporium in Moose Jaw — have had to close up shop because supply is hard to come by.

Next time we open, we'd like it to be open for a longer time or permanently.- John Thomas, co-owner of Jimmy's Cannabis

"Some producers were able to fulfil their orders, others it was in greatly reduced qualities, and then others completely backed out of their commitments," said John Thomas, co-owner of Jimmy's Cannabis.

Valli Kuzub, co-owner of Lush Leaf Cannabis in Esterhazy, said it will be hard to bring prices down until there is more supply.

"I think the majority of people are expecting to see that we're able to carry product that would be comparable to the black market prices," she said. "There's always going to be someone that tries to sell it for lower. Our main concern is making sure it's high quality while still getting as low of a price range as we can."

It remains to be seen how legalization will impact the black market in Saskatchewan.

Tim Cullen, CEO of the Colorado Harvest Company, said Colorado's black market has taken a hit since legalization.

"The gold standard forever for cannabis was seven grams for $100 [US]. Since legalization happened [in 2014], that price has been cut in half," he said. "You have larger scale production, you have economies of scale. Legalizing it took a lot of the fear out of it as well and that lowered the price too."

Cullen said you can now get the same seven grams of marijuana in Colorado for $50 US or less. 

In Saskatchewan, SLGA is the regulator of cannabis, but distribution and wholesaling is left to the private sector. As a result, SLGA doesn't have supply agreements with licensed producers. It's up to retailers to arrange their own sales. There's no set minimum or maximum price for marijuana.

To-date, there is one cannabis wholesaler licensed by SLGA and there are 20 federally licensed producers who are registered by SLGA to sell product to retailers and wholesalers. Morris said there are applications ongoing for more potential producers in Saskatchewan, but couldn't confirm how many. He said there is no limit on how many producers or wholesalers could exist in Saskatchewan.

Next to no Saskatchewan online presence 

By law, cannabis retailers in Saskatchewan can only operate an online store if they already have an operational storefront in place. The second hurdle is having enough supply to support it.

Eden, in the RM of Edenwold, is the only Saskatchewan store actually selling cannabis online. Every other retailer has an online presence. Some sell T-shirts or paraphernalia, but no plants. 

Thomas said they've had their online store ready since Oct. 17, but they don't have enough supply to keep both stores open, let alone reliably offer any product online.

"I think what we have to see is that the producers are actually delivering what they say they're going to deliver. Because we'd feel more confident opening the store if we were confident that more supply is arriving next week and the supply that we're being promised is actually going to show up in the future.

"Next time we open, we'd like it to be open for a longer time or permanently."

Thomas said Jimmy's Cannabis is expecting their Estevan SLGA permit shortly, but again, need supply. Their Moosomin store is targeted to open in December and he's hoping supply issues will be worked out by then. 

Kuzub said Lush Leaf's online store is ready to go and should be ready by the end of the week. While they do worry a bit about supply, their bigger issue is location and shipping methods. In Saskatchewan, age verification is required at the time of delivery. 

"A lot of the other provinces that are government-run, they were able to start that a lot sooner. But for us with Canada Post, we weren't able to ship through them. So we're in the process of setting that up," Kuzub said, adding other shipping companies, like FedEx, don't have depots in Esterhazy.​

Kuzub said Lush Leaf was told things with Canada Post would be in place in time for legalization, but that didn't happen. The company is currently in the process of setting up an account so they will be able to offer the same delivery services as other provinces.

Not many charges for police

RCMP have arrested a few people for trafficking, but otherwise did not have much to report around enforcement.  

Saskatoon police say they laid six charges related to marijuana during the first two weeks of legalization, including possession of cannabis for the purpose of selling, minor possession, consuming cannabis in a public place and possession, consumption or distribution in a vehicle. 

Regina police chief Evan Bray said officers have seen a lot of consumption in public and are choosing to use it as a chance to education people instead of enforcement and punishment.

"I actually had a personal encounter with an individual the other day, it was a very positive one. The individual actually had a medical purpose for consumption and was able to the show the documentation of that," he said.

With files from Stephanie Taylor.