COVID-19 has been sending buyers into panic mode for all sorts of items and supplies. Among the “essentials” Canadians have been buying a little (or a lot) extra of: cannabis.
Legal recreational cannabis retailers across the country are reporting major increases in sales both online and in-person.
So what does this mean for the licensed producers that provide for the hoards of recently unemployed and TP-deprived Canadians? Can LPs keep up with demand while also managing the health risks amongst their staff and customers? And if so, how?
How are licensed producers reacting to COVID-19?
Canada’s cannabis providers, like many other businesses across the country, are facing the very new and very real challenge of remaining operational during the evolving COVID-19 crisis.
Our production facilities remain fully operational and we have not experienced any disruptions to regular operations, including our existing supply chain.
Many licensed producers including Zenabis, Aurora, Canopy, and 48North remain fully operational but are practicing new health protocols and encouraging employees to work from home when possible.
“The COVID-19 situation remains fluid, and with the health and safety of our team as a priority, 48North is doing everything we can in collaboration with our provincial partners to keep our products available for all Canadians,” says Charles Vennat, CEO at 48North. At its plants, shifts and breaks have been staggered to limit person-to-person contact, sanitation procedures have been increased, and supplemented Employment Insurance is being offered to those who may fall ill.
Similarly, Aurora has announced the activation of its crisis preparedness program, cancelling work travel for its employees while also monitoring and even discouraging personal travel.
“Our production facilities remain fully operational and we have not experienced any disruptions to regular operations, including our existing supply chain,” Michelle Lefler, VP Communications at Aurora, said in a statement. “We recognize that the situation is evolving and will continue to assess daily.”
Meanwhile at Canopy Growth, the increasingly demanding scenario prompted by the novel Coronavirus outbreak is being met with a digital-first solution.
“In responding to the current situation, we have shifted our focus from retail to e-commerce,” says Jordan Sinclair, Canopy’s VP Media & Communications. “We have established, fully supported e-commerce platforms for adult customers in Manitoba and Saskatchewan through our Tweed.com and Tokyosmoke.com e-commerce platforms, our patients are able to access SpectrumTherapeutics.com as they normally did before, and the independently-owned branded stores in Regina and Ontario have opted to remain open at this time.”
Canadians have also been experiencing a disruption in cannabis deliveries from Canada Post—with at-the-door drop-offs no longer an option and a trip to the post office now mandatory for many—but it is still possible to order cannabis online and avoid the brick-and-mortar dispensary.
Should Canadians expect shortages?
We’re in constant communication with our licensed producer partners and right now and they’re not indicating anything that gives us concern.
Despite the substantial boost in sales, there isn’t any indication of an impending cannabis shortage in Canada.
In Ontario, where sales through the provincial OCS store have recently doubled, no red flags have been raised.
“We’re in constant communication with our licensed producer partners and right now and they’re not indicating anything that gives us concern,” says Daffyd Roderick, Director of Communications at the Ontario Cannabis Store.
Echoing this sentiment, a media spokesperson for Aurora reports it is “well-positioned to meet demand.”
In the medical cannabis field, producers like WeedMD are taking similar precautions, but aren’t anticipating any shortages.
“An external question I often get is how will WeedMD supply all of its channels?” says Angelo Tsebelis, CEO of both WeedMD and newly acquired Starseed. “I’m pleased to confirm that we have 17 cultivation rooms that are all cycling through various stages of production alongside our mother room and two propagation rooms in our hybrid greenhouse in Strathroy, Ontario. Our teams strategically stagger our rooms so that harvest schedules are spaced out for ease of production and packaging, expediting our speed to market. With the 10 additional rooms that came online in the second half of 2019, we are now seeing the full production capabilities of our cultivation platform as we brace for a major production surge.”
In short, it’s not business as usual by a long shot, and LPs are assessing the situation daily, but so far production isn’t being impacted.
