Among the first to sell legal Cannabis in Canada, business owner says he's closing his store
Portugal Cove-St. Philip's business owner says he's had a tough time getting financing since the beginning.
Thomas Clarke sold cannabis illegally for 25 years and became one of the first people to sell it legally in Canada after the drug was regulated in October 2018.
But now he's faced with having to close up his independent shop in Portugal Cove-St. Philip's — among the first in Newfoundland and Labrador — for good.
"From the beginning, I've had a really hard time getting financing. I started this whole business with $250,000 that I had saved and borrowed from family members and I probably went through that money before 2019 was over," Clarke said Monday.
Clarke threw open his doors at midnight on Oct. 17, 2018, to be the first to legally sell cannabis in Canada in a historic moment that saw the end of prohibition across the country.
Other retailers and suppliers, such as Canopy Growth and its storefront Tweed, have also felt the sting of the young and still growing industry.
Clarke said he couldn't open bank accounts to keep his business going, and in 2020 there was a shift to having licensed retailers buy their product through the Newfoundland and Labrador Liquor Corporation — the regulator of alcohol and cannabis in the province.
He said he had to use cash up front and accumulated debt in the hundreds of thousands of dollars.
"Starting around 2021 I started to have less stock because I never had enough money to buy cannabis to satisfy every customer," he said.
"From 2021 until now I've generally been having a very small menu and that's not serving the people of Portugal Cove-St. Philip's and everyone else who comes to my shop. So I lost a lot of customers."
Clarke also pointed to the COVID-19 pandemic and competition moving in near his location as other reasons why he has faced detrimental losses and had to lay off his entire staff.
"I was doing $1.5 million in sales a year. Compared to last year, I only did half a million," he said.
"I'm to the point now where I'm completely out of money and have to close the doors."
Keeping the dream alive
In the NLC's 2023 third-quarter report, the Crown corporation posted $18.7 million in cannabis sales, marking an increase of 31.9 per cent over the third quarter of the previous year.
The NLC said a decision made in September — after a three-year review of the industry — to approve cannabis vaporizers boosted the bottom line with $1.6 million in sales in the third quarter. That amounted to nine per cent of total cannabis sales.
Cannabis N.L., the cannabis division of the NLC, also welcomed two new licensed retailers to the fold in the third quarter: Atlantic Cannabis in Torbay and Oceanic Cannabis in St. John's.
There are currently 41 licensed cannabis retailers in Newfoundland and Labrador, but Clarke says there may be more and his dream isn't quite over yet.
"I've been working with Oceanic and it looks like they're going to be opening a store here in April. I'm going to work here for them," Clarke said.
"I'll be able to still be in the industry, I'll be able to have a much better menu and I'll be better able to serve customers in the future."