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Retailers sniffing around in Nunavut cannabis market

In over six weeks since the Government of Nunavut opened the application process for retail cannabis locations in the territory, just one contender has stepped forward.

If retailers enter the cannabis sales market in Nunavut, it would be difficult for entrepreneurs to get established in small communities, unless community councils choose a local businessperson when there’s competing applicants, says MLA John Main, chair of the regular members’ caucus.
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Nuna Cannabis Ltd. is seeking to set up shop in Iqaluit. Public feedback on that proposal can be sent to the GN until Aug. 20.

“We have, however, received a lot of interest from potential retailers,” a spokesperson for the Department of Finance informed Nunavut News, “…but (we) cannot provide more details until we have received a formal application.”

The North West Company – owners of Nothern Stores, NorthMarts and Quickstops – did not return numerous calls or messages prior to publication deadline.

A representative of Arctic Co-operatives said if Co-ops delve into selling cannabis, it won’t be chain-wide. At the last annual general meeting in May 2019, a resolution to sell cannabis in the communities was defeated, said Duane Wilson, vice-president of stakeholder relations with Arctic Co-operatives.

“That was a message from the membership, whether it’s that ‘We don’t want this in our communities’ because they’ve got kind of a community lens, or whether it’s ‘We don’t want this in our community-owned business’ because they’ve got a risk lens and they know there’s a heightened risk for break-ins, etc., I can’t say,” said Wilson.

There’s still an opportunity for individual Co-ops to pursue cannabis sales if they choose, Wilson said.

“It depends on what the desires of our members are,” he said, adding that he’s not aware of any Nunavut stores pushing ahead with such an initiative.

Arviat North-Whale Cove MLA John Main, who’s chair of the regular members’ caucus, was vocal in the legislative assembly about the need to make the application process attainable for aspiring entrepreneurs in Nunavut.

He said he’s not surprised that no rush of local entrants into the industry has ensued because the cannabis sector in the south has proven to be on “shaky ground” with various companies failing to meet revenue objectives.

“Maybe this thing isn’t the homerun money-maker that everyone had envisioned initially,” he said.

It would be reasonable for the GN to enter negotiations with a Northern-based retailer at some point because, otherwise, the territory is missing out on business revenue in the private sector and tax revenue, Main said. Since cannabis legalization in October 2018, Nunavummiut have only been able to purchase the drug legally via GN-approved online retailers.

“We haven’t come close to making a dent in the (illegal) cannabis market so far… in terms of the products they’re offering and the convenience,” Main said.

If major retailers do get regulatory clearance to make a foray into cannabis sales in Nunavut, it would be difficult for an independent Nunavummiuq businessperson to get a foothold in the smaller communities, Main acknowledged, but not necessarily impossible.

“When the licence application comes in, the community in question will have a role in seeing whether it’s approved or not. The level of government that’s closest to the community will be given a chance to help shape what this industry will look like,” he said, adding that the community council may choose a local family-owned and run operation over a large retailer if there are competing applicants.