Disrupting the Illegal Cannabis Market – What’s the Magic Number?
Regina Wrestles with Whether or Not It Has Enough Cannabis Stores Disrupting the Illegal Cannabis Market – LPC
We talk about disrupting the illegal cannabis market all the time. It’s already known that greater access to legal cannabis will mean fewer people will go to the illegal market. In September 2020, the legal cannabis market outpaced the illegal cannabis market in Canada.
However, there’s not much information out there about where the tipping point is. But as far as Regina is concerned, the magic number is 24.
That’s according to a report the city received from industry analysts. The general rule for a mature market should be one legal cannabis retail store for every 10,000. In a city the size of Regina, population 240,000, that would make their magic number 24. So, 24 stores in Regina would “ensure a health business environment”, ultimately disrupting the illegal cannabis market.
This would “ensure a healthy business environment to disrupt the (illegal) market.”
But according to that same report, there’s a problem.
“The current zoning rules in Regina impose barriers to potential shop owners due to the minimum separation distances required, the limited zones that permit the use, and the absence of any discretion to consider the unique aspects of individual sites. This has left potential store owners frustrated with the limited options as expressed by customers to the City through permit reviews or preliminary reviews of sites, as well as service requests.”
In other words, it would be difficult for Regina to hit that magic number of 24 stores for disrupting the illegal cannabis market due to zoning laws. As it stands now, there are only 11 cannabis stores in Regina with 11 more applications in the pipeline.
What We Can Learn from Regina about Disrupting the Illegal Cannabis Market – LPC
According to the report to Regina, whether or not a cannabis market flourishes – legal or illegal – depends on price, supply, and location. Cheap cannabis sold legally can certainly undercut a market. Supply and location – can I get it here, and can I get it now? – is another no-brainer.
“Displacing the black market further, according to industry experts, will depend on the extent to which the legal market can offer a better cost, location and supply,” said the report.
However, city’s have more concerns than simply disrupting the illegal cannabis market. Many if not all cities have by-laws concerning cannabis stores in school zones. Some limit the number of stores in a given area, as does Regina.
One Regina administrator said that there has been limited public feedback about current cannabis store locations.
“Nothing overly of concern from the public,” said City of Regina executive director of People & Transformation Louise Folk. “We have heard specifically from the stakeholders and the developing community, (which is) one of the reasons why we are looking at bringing those recommendations forward on zoning.”
That doesn’t mean concerns don’t exist. Changing these by-laws to fit more cannabis stores in could bring public disapproval. The political question will always be considered, whether it’s based in scientific fact or not.
But if the science of disrupting the illegal cannabis market is right, then finding ways to open more cannabis stores should be a priority. That’s true in Regina as well as cities across Canada.
Read the Full Story in the Regina Leader-Post
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