Ontario will allow private cannabis retailers to sell their products online or by phone for in-store pickup, in a significant move that chips away at the Ontario Cannabis Store’s monopoly on online cannabis sales. 

The province’s fall economic statement is proposing amendments to the current legislation around cannabis retail in order to “ensure consumers’ preferred cannabis products are available” and “wait times reduced” at the 25 retail stores that currently operate across the province. 

As it stands, the provincially-run Ontario Cannabis Store’s website ocs.ca is the only option for people to purchase legal cannabis products online. The new click-and-collect system would increase the involvement of the private sector in cannabis retail and allow consumers to browse through multiple websites, choose the products they want and immediately pick them up at the store of their choice. 

“It brings an instant gratification to the consumer, and an Amazon-like experience that we don’t have right now in the province, given how long it takes for the OCS to deliver product,” said Omar Yar Khan, National Cannabis Sector Lead for Hill + Knowlton Strategies. 

A similar system exists in Alberta, where Leafly — the largest cannabis website in the world — acts as a platform that individual retailers sell their products on, in addition to them being available in store. After choosing your products, an identification check will take place upon pick up. 

I certainly applaud the government for proposing these regulations. Today is just the first step, but Leafly will absolutely aim to participate in Ontario,” said Jo Vos, Managing Director of Leafly Canada. 

Khan believes that the OCS will still maintain a monopoly on online sales and delivery, given that private retailers will not be allowed to deliver online orders directly to consumers. 

“Part of the challenge that policymakers and retailers have faced is how do you get consumers to gravitate away from the illicit market? Anything that policymakers can do to empower those who choose to play within the rules that can compete with black market online services is welcome,” he said. 

The Ontario Cannabis Store did not immediately respond to a request for comment.

The province also confirmed that it would allow licensed producers to establish retail stores at their production sites, a move that the Ford government had backtracked on in the last year. For example, Canopy Growth’s Tweed merchandise store located at its main production site in Smiths Falls, Ont. will now be able to sell cannabis products. It is unclear, however, how many stores each licensed producer will be able to open. 

Changes to the cannabis retail system appear to respond to frustration that both licensed producers and retailers have had about the inability of the present system to meet consumer demand. Besides having just one online site that consumers can purchase weed from, there are currently just 25 retail stores across a province of over 14 million people, with only 50 more set to open by the end of this year.

By contrast, there are almost 300 stores in Alberta.

Language in the fall economic statement also indicated that the government might abandon the highly-contentious cannabis lottery system, which has so far awarded 67 licences to winners over the last  year.

“The government remains committed to moving to an open allocation of cannabis retail store licences where the number of stores is limited only by market demand,” the statement read.

Industry participants have long called on the Ontario government to open up the retail licensing system such that any applicant who meets criteria set out by the Alcohol and Gaming Commission of Ontario will be able to own and operate a cannabis store in the province, similar to the Alberta model.

The lottery system sparked a frenzy when it was first implemented, with the few winners being offered millions of dollars in exchange for stakes in their stores.

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