B.C. cannabis stores brace for emptier shelves as strike stops provincial shipments

Cannabis stores in B.C. are bracing for emptier shelves after a strike that began this week stopped the province's pot distribution centre from shipping out product.

The British Columbia General Employees' Union (BCGEU), which represents about 33,000 public-service workers across B.C., set up picket lines at four Liquor Distribution Branch (LDB) wholesale and distribution centres Monday.

Retail liquor and cannabis stores are not part of the strike launched over wages, but the cannabis division of the Burnaby customer care centre is part of the job action, the union said.

In response, the LDB announced its cannabis distribution centre will not accept or ship product, assemble orders, or process invoices or purchase orders.

"We sincerely apologize for this disruption and for the impact to your business,'' the LDB said in a note to stores published on its website.

The province was preparing to allow cannabis stores to accept direct deliveries of product from licensed producers long before the strike began, but until those deliveries start, stores have no choice but to get their products from the LDB.

"The B.C. Liquor Distribution Branch recognizes the current job action being taken by the B.C. General Employee's Union may be concerning to wholesale and retail customers,'' it said in a statement, noting that B.C. Cannabis Stores online is also unable to fulfil or deliver customer orders.

"We do not know the extent of any future job action and therefore cannot speculate on the inventory levels held by wholesale customers nor customer demand and buying behaviours in this dynamic environment.''

Survival beyond 2 weeks will be 'very difficult' 

Some store owners are already bracing to close if the distribution centre isn't back up and running soon.

"If it lasts more than two weeks, then we are probably looking at closing down the store because there is nothing to sell," said Jacob Michalow, the assistant general manager at Marigolds Cannabis in Vancouver.

Vikram Sachdeva estimates his B.C. chain of Seed and Stone stores has a good supply of products right now but agreed that could quickly change if the strike drags on.

"I'm hoping that we can survive for a week or a little bit longer, but beyond that point, it's going to be very difficult,'' he said.

Sachdeva wishes stores had been notified earlier about the delivery stoppage so they could have stocked up on products.

"It just came as a bit of a shock, and ... now the concern is how long before they start delivering to us so that we don't start running out of products?'' he said.

He added he will be disappointed if he has to turn away consumers for lack of product, especially if they are seeking cannabis for medical reasons.

He also fears consumers may turn to the still popular illicit market if they can't find cannabis stores with stock left.

High Tide Inc., which is behind the Canna Cabana chain of stores, has similar worries.

"For the time being, we are managing the situation by reallocating inventory between our British Columbia stores, but if the job action is not resolved within the next 10 days, we could face inventory issues,'' said Omar Khan, the senior vice-president of corporate and public affairs, in an email.

"We urge the BCLDB and the BCGEU to resolve their dispute as soon as possible, as lack of inventory at licensed cannabis stores risks driving consumers back into the hands of the illicit market, which will endanger public health and drive much-needed revenue away from government coffers.''

Providers criticize distribution model

B.C.'s distribution model is a point of contention for private retailers in the province. The current system only allows legal cannabis stores and government-owned shops to get their supply from B.C. liquor and cannabis centres rather than private sources.

Restaurants and bars, on the other hand, do have the option to buy directly from private craft breweries and wineries if the distribution centre doesn't deliver.

"That is something that we're calling on government to explore," said Jaclynn Pehota with the Association of Canadian Cannabis Retailers. "We would like the same diversity of supply chain for cannabis retail."