What Could the Houseplant-Canopy Split Mean for Craft Cannabis?
Many Suspect Houseplant-Canopy Split Over Quality. Could Craft Cannabis Do Better? – LPC
Houseplant, Seth Rogen’s Canadian cannabis brand, is parting ways with Canopy Growth and leaving the Canadian market. The announcement of the Houseplant-Canopy split came roughly five months after Houseplant announced it was launching in the United States. Although both companies say the breakup is mutual, most believe that Houseplant was the dumper, not the dumpee. And, many believe, quality was a key issue.
The London Free Press quoted cannabis reviewer Brad Martin on his description of Houseplant’s Sativa strain in 2020.
“The feel is about as bad as it can be,” Martin wrote. “The buds are brittle, so fragile they’re unable to withstand any amount of force whatsoever. They grind to a dusty particulate which could easily blow away in a gentle breeze.”
Not exactly a stellar review for what is supposed to be a quality, luxury cannabis brand.
Houseplant’s launch south of the border, on the other hand, has been stellar by all accounts. Demand literally broke the website when Houseplant broke into the US market in March.
“I have been working on my own weed company for the last 10 years,” Rogen said at the time, as if his Canadian business didn’t exist. “We are finally ready to launch in America.”
Today, Rogen said the Houseplant-Canopy split is “not an exit from the Canadian market”. However, once product runs out in September, it will be exactly an exit from the Canadian market. The press release claims Houseplant will be back with a product “more consistent with its US offerings”. But it didn’t give any details or dates.
Could Houseplant-Canopy Split Open the Door for a Craft Cannabis Company? – LPC
However, the Houseplant-Canopy split does raise another important question. Should a large licensed producer like Canopy Growth be expected to deliver premium quality? On the other hand, Canadian craft cannabis companies are struggling to find market share, despite quality. A recent change to Ontario Cannabis Store (OCS) policies means craft cannabis is also struggling to find shelf space.
But there are some bright spots. The recent merger between WeedMD and CannTX to form Entourage is one. This cannabis play gives the company the best of both worlds: mass cannabis production and craft cannabis. It’s a way larger companies can still offer the quality that comes with craft cannabis operations.
Perhaps Houseplant could re-enter the Canadian cannabis market using one or more craft cannabis operations as its suppliers. This would solve some problems. Quality – and quality control – would be easier for Houseplant to maintain. For the craft cannabis partner, it would mean a big name behind it, which would help it find shelf space. There could be other problems though. Houseplant is a big name, so would its craft cannabis partners be able to keep up with demand?
The Houseplant-Canopy split is certainly a sign of things to come as Canadian cannabis companies continue to shift focus to the opening US market. But it might also signal opportunities within Canadian craft cannabis as well. When companies want to launch premium, luxury brands in Canada, Canadian craft cannabis will be a logical place to go.
Read the London Free Press Story Here
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