Replies to post #190 on Fire & Flower Holdings Corp (FAF)

[FUNMAN]

If Ontario ramps up from granting 20 to 40 licenses per month, a F & F shareholder can hope they can snare at least 1 or 2 per month. That would put F & F back onto its guidance path, in the most populace province, plus the other provinces they are already expanding in.


I was adding because I believed they could hit the store opening target.

Target Date Total / Number of Stores

FY 2020 / Q3 65 stores

FY 2020 / Q4 78 stores

I believe the PPS is lagging because they aren't even close with only 51 stores, and 3 months to go.

It seem ludicrous that they haven't amended the presentation, especially since they already passed some of the target dates.

[FUNMAN]

Future of Ontario pot shops predicted to mirror Walmart and Costco

Moving away from “Apple store-esque” experience, data points to a transition from tech to grocery business model for cannabis retail

By Arundati Dandapani and Jean Lépine
October 1, 2020

https://www.thegrowthop.com/cannabis-news/future-of-ontario-pot-shops-predicted-to-mirror-walmart-and-costco

Interesting article, but in my opinion the writers are years away from realizing their conclusions. Cannabis is not going to be sold in grocery stores. - FUNMAN

Although the development of cannabis retail in Ontario has been less than ideal, the chapter of bottlenecks appears to be behind us following the announcement to double the speed at which the province will process new retail store authorizations.

Retail entrants can now focus on what they can offer their customers — both in product and in-store experiences — for which Toronto-based market research company, Vividata offers interesting insights.

What do consumers want?

In its 2019 study on post-legalization usage, the company analyzed data collected from over 5,000 respondents. Out of which, 53 per cent admitted to securing cannabis through legal sources, whereas 38 per cent did so from the illicit market. The main source of legal cannabis for current users is physical retail — adopted by well over half (55 per cent) of all Canadian users; at 46 per cent, digital retail comes a close second.

In cannabis, as with most products in the consumer packaged goods category, consumer insights are key to growing market share. One such insight has been duly observed and adopted by cannabis companies as COVID-19 brought the retail industry to a standstill.

Among first-time health and wellness users, edibles are the second most popular form of consumption — along with vapes — only after concentrates. Cannabis use, however, soared during periods of isolation. Edibles, pre-rolls and vapes emerged as victors in a time when people kept away from “sharing joints.”

As for non-cannabis users, lack of education remains the biggest stumbling block. A majority of Canadians (70 per cent) are not sure they know the difference between CBD and THC, the two principal compounds in cannabis.

Grocery retail model is the key
The future of cannabis retail is far from straightforward. Given Ontario’s restricted beverage alcohol retail sector with two dominant government-aided or owned players, retail can’t mirror its sin taxed cousin. Stigma against cannabis use also works against normalizing consumption.

If you recall early announcements concerning store designs, many retailers aimed for an upscale “Apple store-esque” experience. Budtender interaction was also responsible for the type of customer experience provided in-store according to surveys by Brightfield & Co.

But the current volatile environment is shaking things up.

Our view is that the cannabis retail sector will mirror the evolution of grocery, not technology retail. Although technology users and early adopters index higher on their use of cannabis (this user base is driven largely by younger and affluent demographics) it is the convenience store and health and wellness shoppers who will bring cannabis into mainstream retail because these users have a higher share of wallet and spending power at the moment.

Cannabis users are avid grocery shoppers with the highest percentage (25 per cent) going out food shopping twice a week. Should, for example, mini cannabis kiosks move into big malls or into the physical limits of Loblaws and Costco, it will represent a sizeable market currently not tapped into. In particular, the health and wellness Zoomer medical cannabis consumers are predicted to drive this normalization of cannabis consumption.

Like the small wine boutiques, cannabis in grocery stores could be sectioned off from the other products clearly and strictly in surveillance to avoid food product hazards and underage use. Over half of Canadian cannabis users shop for food with “cents-off” coupons, pointing to the opportunity in ways to earn the cannabis grocery shopper’s loyalty.

And the long term winners will be…

The most interesting retail will come from those not beholden to their integrated partner but those who have enough scale to secure product flow — the Whole Foods type operators. This is supported by the demonstrated earning power of current cannabis users, 25 per cent of whom have reported spending an average of between $100-$149 weekly, and 62 per cent of daily users of cannabis have shopped for food most often at groceries in the past six months.

According to Vividata’s survey, Walmart appears to be the most shopped at grocery store among cannabis consumers followed closely behind by Costco. The largest proportion of current cannabis users (65 per cent) shop at grocery stores the most, followed far behind by those who shop at bulk food stores (33 per cent) and drug stores (29 per cent).

Moreover, grocery shopping will further drive normalization as 71 per cent of current cannabis users (or 4.1 million Canadian cannabis consumers) shop for their food from a private label or non-branded stores (and a similar proportion shop as regularly from grocery stores) signalling the huge opportunity for cannabis brands to make an entry-point in grocery stores where brand names are not prized so much as safe legal products of daily convenience.



Arundati Dandapani is the Founder of Generation1.ca and Chief Editor at the Marketing Research and Intelligence Association (MRIA-ARIM). Jean Lépine is Executive Vice President of the BlackShire Group and founder of the Organization of Independent Cannabis Entrepreneurs (OICE.ca.)

[FUNMAN]

I can't believe the PPS is back down here?