Manitoba cannabis shops face tough competition as stores now
outnumber Tim Hortons coffee shops

Cannabis market reaching oversaturation, store owners say
Joanne Roberts ú CBC News ú Posted: Apr 20, 2022 5:11 AM CT | Last Updated: April 20

Othmar Joos and Melanie Bekevich, owners of Mistik Cannabis Co., say they were prepared to enter Manitoba's competitive market because they believe the community will support their local, Indigenous-owned store. (Darin Morash/CBC)

It might be easier to find cannabis in Manitoba than a double-double.

The province has 155 licensed cannabis stores, compared with just over 100 Tim Hortons locations, as of April, according to the Liquor, Gaming and Cannabis Authority of Manitoba.

Retailers are saying the market has become oversaturated, and they predict store consolidations and closures in the near future. However, it hasn't stopped stores from popping up all over the province.

Winnipeg's newest independent shop, Mistik Cannabis Co., had its grand opening just over a week ago. Owners Melanie Bekevich and Othmar Joos say they knew Manitoba's market was competitive, and say they're excited and prepared to be one of the key independent players.

"For us, it was about putting our best foot forward," Bekevich said. "Being small and independent is really important to us to really put who we are out there. And then we run our best race and hope that people support us."

Mistik customers can shop by experience - from non-psychoactive products to deep relaxation, all the way to more energetic products. She says this is what sets them apart from other stores.

Even though there are several other cannabis stores in her area, Bekevich says the reaction to their store opening has been encouraging.

"I think most people are really, really happy to support an independently owned, Indigenous-owned store," Bekevich said. "And of course, the space is beautiful. We've really put a lot of energy into . carefully planning the shop so that it really caters to all customers."

Mistik Cannabis Co. opened in Winnipeg in March. Its owners say the store is prepared to compete in Manitoba's cannabis market. (Darin Morash/CBC)

Delta 9 Cannabis Store, one of Canada's largest cannabis retailers, has 13 locations throughout Manitoba.

Owner John Arbuthnot says he believes the market is reaching oversaturation, and consumers will be a factor in store closures.

"The approach that we've taken in Manitoba [is] allowing for the free market to essentially dictate who those winners and losers will be," Arbuthnot said.

Delta 9 just announced an agreement with the province to become one of the first licensed cannabis distributors. He believes this will help create more market efficiencies that will see more out-of-province suppliers ship their product to Manitoba.

The Jupiter Cannabis store on Academy Road opened on April 20, 2021. Owner Tom Doran says Manitoba's cannabis market has become ultra competitive. (Darin Morash/CBC)

Thomas Doran and his wife, America, decided to open a cannabis store in June 2020, when the province opened up licensing for independent retailers. He's trying to come up with a strategy that will help independent stores survive the coming years.

Since they opened Jupiter Cannabis a year ago, the market has become ultra competitive - not only in terms of competing with other independent businesses, but also with big retailers like Delta 9 and Canna Cabana that are constantly expanding.

"The main challenge for us was just establishing our value proposition in a marketplace where you'd have competitors who were firmly entrenched for about four years, who are publicly traded and have a lot of resources," Doran said.

"We had to be very strategic in terms of where we selected our location and how we built it out."

Doran, who has been in the cannabis business in Alberta since 2003, says Manitoba will see stores closing in the future. He thinks independent stores need to start working together in order to survive.

"Our hope is that we can collaborate with other brands because it makes it a lot easier," Doran said. "We don't have the same kinds of resources as publicly traded brands and we can't make any mistakes."

Jupiter Cannabis owner Thomas Doran says independent retailers need to start collaborating to survive the cannabis market oversaturation. (Darin Morash/CBC)

Doran is hoping friendly Manitoba stays true to its name and continues to support local businesses.

"We noticed that people here, they support local. It means a lot more than other places that I've lived, and we're hoping that stands true going forward," Doran said.

Bekevich says collaborating with other independent businesses would be advantageous, and she's open to the idea. She even had a chat with Doran, who came to Mistik's grand opening with his wife.

"I think there's a lot of room for us to work together," Bekevich said.


ABOUT THE AUTHOR
Joanne Roberts

Joanne Roberts is an award-winning Winnipeg filmmaker. She is currently a reporter with CBC Manitoba. Find her on social media @reporterjoanne.

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