Ontario Cannabis same-day delivery could be a logistical nightmare

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The Ontario Cannabis Retail Corp. (OCRC) posted a tender call last week for couriers so that they can offer same-day delivery.

According to the OCRC, the program is supposed to launch in early March and will be focused on the Greater Toronto Area to start.

“As OCRC’S marketplace evolves, the ability for the organization to provide a variety of delivery options to meet customers’ expectations is imperative to the growth of its e-commerce business. Accordingly, the OCRC is looking to add expedited/same-day home delivery service,” says the tender call that was posted online.

But in wake of the announcement, some are concerned that this could prove to be a difficult undertaking.

Randy Rolph, owner of Pineapple Express Delivery, is one of the bidders for a same-day delivery contract. He is also among those that believe the Ontario Cannabis Store (OCS) will face a lot challenges in implementing the program and keeping their promise of same-day delivery as the sales data shows that Ontario has experienced a slow start in legal cannabis sales.

Same-day delivery “is not a simple space,” according to Rolph. “It is not the same thing as just being in the logistics space, this business is very tedious but can also be very hectic.”

Rolph told sources that the lack of access to cannabis is what is contributing to the slow sales activity.

According to recent sales numbers released by Statistics Canada, Ontarians purchased $21.9-million in the first six weeks of legalization. Comparatively, Albertans purchased $19.4-million in the first six weeks of legalization but with less than a third of the amount of people living in Ontario. Alberta has had retail storefronts in place since legalization but Ontario’s stores are not set to be open until April.

“I could have already launched in Saskatchewan,” said Rolph. “But the problem is the stores in Saskatoon, just to name a few, they can’t even open for online delivery right now because they don’t even have enough supply just for the people walking into their stores.”

He also said that even if they were only to start with the GTA that it would be difficult to get delivery services including Uber and Lyft because “there is only a certain pool and everybody is fighting over drivers.”

“People don’t realize that you driver pool can be very limited especially when you’re fighting over them with Uber, Foodora and Doordash,” said Rolph.

Ryan Dempsey, CEO of Eddy Cannabis Delivery and former Uber Canada executive, is still debating bidding on the contract, noting that it is problematic that currently the OCS only has one distribution centre in Oakville.

“We still don’t think this is the ideal solution in terms of where we think things will need to go long-term,” said Dempsey. “You’re going to need trucks and warehouses and actual delivery people. Then the question becomes, can it be done at a low enough cost where it would actually make sense to consumers?”

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