More and more Quebec growers are selling their products to the Société québécoise du cannabis (SQDC). Their place has also increased in the growing sales of the crown corporation, which allows them to perform well in a very competitive market.
As of this week, Cheers Cannabis is one of 14 Quebec producers whose cannabis can be sold directly to Quebec consumers. They were only three a year ago, according to the SQDC.
“We can’t wait to present our product, our own brand,” says Cheers Cannabis Sales Director Vicky Laliberté. ” It’s the fun to be linked to consumers. We want a relationship with them, to listen to customers, ”adds his brother, Kevin Laliberté, production manager.
About ten members of the Laliberté family also work for the Varennes company. In 2018, the Laliberté Group, then working in construction and real estate, converted its farmland into indoor cannabis greenhouses.
“We didn’t know anything about that, we were in a bit of a panic. Without other Quebec producers who helped us, we would not have gone through it, ”says Kevin.
The family team began in January 2019 the annual production of 1.8 million grams of cannabis in their facilities of nearly 2000 m2. However, until now, it was not possible to find the packaging of Cheers Cannabis on the shelves. They only sold their stock in bulk to other licensed producers, often larger ones, who were in charge of marketing.
But it was becoming difficult to do good business this way, with the abundance of producers fighting for contracts. In fact, the number of license holders to cultivate, process or sell cannabis in Quebec has doubled between September 2020 and today, from around fifty to more than 100, according to data from Health Canada and Statistics Canada.
“The producer keeps a margin, and that reduces profits,” underlines Vicky Laliberté. She and her team therefore decided to apply for a sales license allowing them to do business with the SQDC.
Encourage the local economy
The leaders of 5 Points Cannabis, a company located in Pierreville, in Center-du-Québec, took the same turn three months ago, for similar reasons. “The SQDC is a very good partner, because it ensures that you have a privileged place,” says General Manager Alexis Bibeau.
It therefore refers to the “Cultivé Québec” label, launched last June, which allows consumers to label around a hundred offers of dried flowers from here. Mr. Bibeau believes that cannabis enthusiasts prefer local products and have a favorable bias towards the quality of cannabis from small producers, such as 5 Points Cannabis.
For its part, the SQDC says it has “the concern to encourage the local economy”. “From June to today, sales of products bearing the“ Cultivé Québec ”label have gone from 35% to 43%,” specifies the retailer’s spokesperson, Fabrice Giguère, by email.
In addition, the SQDC attributes the growth in its sales to the deployment of its network of stores, numbering 12 in October 2017, 68 in June 2021 and 78 today. Its leaders aim to have a hundred by March 2023.
Precariousness of producers
These progressions rejoice the general manager of the Association québécoise de industrie du cannabis (AQIC), who feels that the SQDC has been attentive to the needs of its members. The portrait of the industry is not, however, entirely rosy, notes Pierre Leclerc.
“In the field, I hear that this is a pivotal year and that it is extremely difficult for producers,” said Mr. Leclerc. “I hear that a significant percentage of producers are not profitable,” he adds, noting that cash is starting to run out in several companies.
“At zero hour, we understand that we are in overproduction”, explains the general manager of AQIC, whose workforce has grown, since its founding in spring 2019, from seven to more than fifty members. , nearly half of whom are farmers.
However, the market still has growth potential. According to a recent survey by the firm Deloitte, 54% of Canadian cannabis consumers buy only on the legal market. There is therefore still a large part of the illicit market to be conquered. The report also indicates that consumers are interested in products that are not authorized in Quebec, such as edibles, topical extracts and vaping.
The Director General of AQIC asks that the government consider his association as a valid interlocutor and work with him to develop a common vision, in order to ensure the survival and development of this industry in the province.