The Alcohol and Gaming Commission of Ontario (AGCO) says its “too early to say” how many of the 25 designated brick-and-mortar cannabis retail stores will be in operation by the provincially mandated deadline of April 1.
“We are hitting the deadlines that are supposed to be met, and everything will be installed and ready by April 1,” said Hunny Gawri, a former Mississauga real estate agent who will be opening The Hunny Pot Cannabis Co. in downtown Toronto.
Gawri has never owned, operated or worked in the retail space, but says that his previous experience as a realtor helped him prepare for how “rushed” the process was. “From the day I found out I won, I knew there was a big challenge ahead of me, but I’ve always been up for challenges in the business environment.”
Ontario first announced the winners of the cannabis retail lottery on Jan. 11, which meant that those chosen had under three months to do everything from finding an actual store, to complying with the various ownership rules in order to obtain a Retail Store Authorization, to working with the Ontario Cannabis Store to obtain supply.
In an email to the Financial Post, the AGCO said that although they have dedicated teams working closely with each applicant, it is “certainly clear there will not be 25 stores open in Ontario right on April 1.”
Gawri is one of many sole proprietors, without prior experience in either the retail space or the cannabis space that won the cannabis lottery in January. The system of opening up legal cannabis retail to anyone has been heavily criticized by those already involved in some capacity in the cannabis industry, who argue that winners lacking the right experience will simply delay the process of getting legal stores up and running.
“I know people are saying things like how can he run a cannabis store without experience but let me tell you we’ve already put our whole team together — we have 48 or 50 employees including a general manager of the store all ready to go on April 1,” said Gawri.
In the days following the lottery, a slew of industry players including licenced producers and existing cannabis retail chains — with the help of lawyers and consultants — descended upon lottery winners to negotiate deals compliant with AGCO ownership rules, in order to gain a piece of the lucrative cannabis retail pie in Canada’s biggest province.
Many of those deals were successful. Cannabis retail chain High Tide Inc. — whose major investor is licensed producer Aurora Cannabis Inc. — has struck deals with three lottery winners in the province, while Canopy Growth Corp. is lending its Tweed brand name to a lottery winner in London, Ont.
But Gawri claims that although he too was inundated with requests from various players in the cannabis industry, he remains the sole owner of The Hunny Pot Cannabis Co. and has no partnership deal with any cannabis company.
“I applied for the lottery not to sell my licence, but to be part of an industry. I’ve wanted to be part of the industry since cannabis legalization was on the horizon,” Gawri said.
To date, only 10 out of the 25 lottery winners have obtained a Retail Store Authorization licence, one of the final stages before being allowed to open their doors to the public. Once the RSA licence is issued, owners have to go through a Retail Pre-Opening Inspection, a process which involves an AGCO official inspecting everything from store signage to testing out the store’s point-of-sale tracking system.
I applied for the lottery not to sell my licence, but to be part of an industry
On that front, Gawri says his dealings with the AGCO have been “smooth.”
“There’ve been no hiccups from that side, and the mindset to them has been that they’re dealing with a flagship store, because of our location,” Gawri said.
The Hunny Pot Shop will be located on Queen Street West, in the heart of Toronto’s entertainment district and right opposite The Friendly Stranger, one of the oldest cannabis accessory shops in the country.
Gawri calls his location a “win.”
“From an area perspective, this neighbourhood was on our list. Then we found this empty store looking for a tenant on Realtor.ca. Lots of work needed to be done to the space, but it’s really coming together and we can’t wait for people to see it,” Gawri said.
On whether there will actually be sufficient cannabis in his store come April 1, despite a supply shortage plaguing the country’s legal industry, Gawri remains confident. “The Ontario Cannabis Store knows that they are dealing with a tight timeline and they’ve been very responsive. There will be lots of product on April 1.”
The AGCO is expected to post an interactive map on their website soon, that will indicate the status of stores, including those approved to open on April 1.