Cannabis sales spiked to a new high in December 2024 of nearly half a billion dollars, but overall, retail sales continue to show signs of slowing down following exponential growth in the first few years of legalization. 

As this initial momentum cools off, retailers in Canada say they continue to see new aspects of the market and much more noticeable seasonal and even regional differences. 

Several retailers we spoke with, representing large chains operating in several different provinces, say they continue to see year-over-year growth in most markets at around five to six percent. This growth is driven not only by new stores, something that has slowed down in the past few years, and retail consolidation, but also by bringing in new clients and creating better customer loyalty. 

Plantlife Cannabis

“I know we’re still growing, maybe about five-and-a-half percent, but it’s not the same year-over-year growth we saw earlier,” says Ashton Faulkner, a regional manager at Plantlife Cannabis, which has 42 locations in Alberta.

Faulkner, who is based in Edmonton and has been with Plantlife since 2019,  recalls the rapid expansion of the market in those early days of legalization. He says that while growth has obviously slowed, he still sees a healthy market with opportunities. 

“I still think there’s some growth there, at least on the Plantlife side. I also think the craft and premium categories are bringing in new consumers that are helping with our growth. So I don’t think we’re at a plateau yet, I think we’re a couple years from that.”

What has become more noticeable as the market matures, says Faulkner, are some of the seasonal and regional nuances of sales. Some areas have more budget-focused shoppers, while others prefer large format flower SKUs or high-potency products. 

“We do see completely different trends in different regions,” he explains. “Calgary, for example, is known for being more bargain-based, especially with a large number of university students. When we go north into places like Fort Mac, we see a lot of high potency, high-end products, and concentrates,” something he attributes to more customers working in the trades.  

Meanwhile, beverages sell better in the summer, along with customers just popping in for something convenient like a pre-roll, while winter sales—especially around the holidays—focus more on large-volume purchases.

“Pre-rolls are always popular, but we see a spike in sales in the summer months.”

He says he doesn’t think it’s gift-giving so much as people stocking up while having time off from work or school, or even preparing themselves for holiday gatherings. 

“I find [seasonality] is a mixed bag,” adds Faulkner. “Year over year it changes as new products come out. With the holidays you get a lot more bulk purchases with consumers getting more things at once, as opposed to just one quick single purchase.”

There are still a lot of opportunities in the retail space, although he does see challenges for independent operators.

“I think for us [at Plantlife], the skies are the limit. We have a lot in the pipeline in terms of a growth plan and more shops. At the same time, we see some that are really struggling. Some mom-and-pops can’t necessarily compete with some of the advantages of the bigger chains.  But we’re definitely seeing good growth on our end.”

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True North Cannabis

Eric Chittim, VP of supply chain at True North Cannabis, with 48 locations in Ontario, says he sees a spike in vape sales in the winter, which he attributes to people not wanting to go outside to smoke flower when it’s cold out. Flower sales, he says, are more common in the summer, as are beverages, echoing a trend noted by every retailer StratCann spoke with. 

“Wintertime would be heavy disposables and vapes and the summertime is high flower sales,” says Chittim.

Similar to what Fualker says he sees in the Alberta market, Chittim also says he sees single-digit growth through the next year or so, but sees that growth ultimately cooling off. 

 “I see us probably being flat or single digit this year. I feel this year is the last year of retail growth and next year is when I project downward trends for the Ontario market.”

While there are always popular, in-demand products that all retailers need to carry, Chittim says retailers need to also focus on bringing in more unique products that, while not always high-volume, can bring in a loyal clientele who then might purchase other products. One of those product categories is capsules and oils, especially as a budget-friendly alternative to edibles. 

“Capsules and oils are a rather small category, but it’s something with a pretty consistent base across all my stores. People are always looking for sugar free CBN products, be it oils or capsules. That’s an easy example of a wellness product that might not ever break $100k in monthly sales but will bring a customer base to your store. It is an easily overlooked product.”

However, Unlike Faulkner, Chittim says he sees a bright future for independent retailers and chains like True North. If anything, he sees more consolidation among chain stores rather than well-run independents. 

“Owner-operators are not going anywhere. There’s a ton of consolidation through franchises, but there’s a ton of indies that are doing well across Ontario that usually hyper-perform in their local areas. I think those owner-operators will keep their businesses, whereas I think we’ll see all the chains melt into one another.”

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Nova/SNDL

Grant Sanderson, VP of cannabis retail operations at Nova/SNDL, says he also sees a similar growth rate, reflecting his colleagues and Statistics Canada’s regular-updated figures. SNDL is Canada’s largest private-sector cannabis retailer by store count, operating 187 locations across several provinces  under its three retail banners: “Value Buds”, “Spiritleaf”, and “Superette.” 

Like Chittim predicts, Sandereson sees increasing competition among some of the larger chains as new store growth slows down.

“When markets start to stabilize, competition intensifies,” explains Sanderson. “Retailers are battling for the loyalty of the customer base, and we have to make efficient operating decisions. We all source products from the same distributors, so we need to distinguish ourselves from each other with a combination of convenience, price, service, and selection.

“For sure 2025 will be an interesting year and I think we’ll see a lot of things shake out with some continued consolidation, contradiction, and some full exits this year.”

Still, he sees a continued opportunity for growth, and into new markets, not only in larger cities that had previously banned retail and are now opening up, but also in smaller regions in many parts of Canada. 

“There are still underserved areas across the country where I think there are opportunities for expansion and organic growth. I think there are a lot of spots across all provinces [that allow private stores].” 

That growth can come in many ways, from leaning into new product categories to doing a better job of attracting and retaining existing consumers. 

“That four wall execution means more today than it has in the past,” says Sanderson. 

“That promiscuous shopper that is shopping around looking for a deal, I think there’s an opportunity to create more brand loyalty with that kind of shopper than there has been in the past. I don’t think it’s necessarily all about just price. It’s a mixture of price, execution, assortment, and service.”

Another area for growth is deliveries, which are still somewhat limited to mail order and delivery by retailers in provinces that allow it. If third-party delivery services are allowed to actually deliver cannabis for a retailer, he says he sees that being fruitful as well.

“I think when we see more red tape reduction around third party delivery, that will be the real catalyst to e-commerce. There’s still some growth there now, but that will change everything.”

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High Tide

Andy Palalas, the Chief Marketing Officer at High Tide Inc., which operates Canna Cabana—the largest single cannabis retail brand in Canada with over 190 retail locations from BC to Ontario—also sees continued opportunities for growth in the retail cannabis sector.

“Our same-store sales growth remains fairly strong,” says Palalas. “We also have opened up, organically, more stores than your average chain [29 in 2024]. This last year plus has been largely us opening new stores as opposed to acquiring new locations through mergers and acquisitions.

“Sales growth in general has been really strong over the past twelve months with new stores coming through, and we did about $33-34 million in January of last year. We pushed about $42 million in December. So overall the revenue picture has been quite bright for us. In terms of same store sales on mature stores, we still see meaningful growth in many of those locations.”

Like Faulkner at Plantlife in Alberta, Palalas says holiday sales are not particularly pronounced in the retail cannabis space. However, people do tend to buy more—mostly for themselves—if they are on a holiday break or vacation.

“I think one of those misconceptions about cannabis retail, at least in the early days, was that Black Friday was going to be a significant sales event for us. In cannabis retail in general, I don’t think those categories of cannabis are particularly conducive to gifting; we don’t see a lot of gifting going on.” [Not counting ancillary products, which he notes do increase in the holiday season].

In general, verticals like electronics and toys and other gitfables are going to do a bit better than cannabis at the end of that November mark. Really, it’s when we come into December, around the second week when folks start getting off on vacation, that we see enormous growth in sales.” 

As for seasonal sales and different product categories, like other retailers StratCann spoke to, Palalas says beverages are more popular in the summer and a bit around the winter holidays, while pre-rolls spike in summer and vapes increase in the colder months. 

But while beverage sales spike in summer, he says it’s still a very small category overall, especially compared to flower and concentrates like vape pens. 

“Beverages are definitely up in the summer, but they’re not a huge percentage of sales,” explains Palalas. “They are about a quarter of the size of the edibles category. Edibles are around four and a half percent under our banner, while beverages are about one and a half. 

“So it does surge in the summer. It also has a pick-up in December. But pre-roll is really what we see surging in the summer. Pre rolls had a huge summer this year: it reached all-time highs in June, July, August of this year, even September. And we’ve seen that reliably pretty much every year. In general, vapes performed better this summer than they had in previous years. Pre roll is definitely the key category throughout the summer.”

In addition to pre-rolls, another huge growth category in 2024 that Palalas sees continuing is disposable, or all-in-one (AIO) vapes.

“Two trends in vape right now are the move to liquid diamonds, and the move to all-in-one vaporizers. Both of those have been a hockey stick up and to the right, with sequential growth that really hasn’t plateaued at all. 

“Vape all-in-one devices still have lots of room for more brands to enter the space. We’re starting to see licensed producers release meaningful products in the all-in-one category. The category is wonderful because there’s a real hardware and brand component that is making the difference for consumers in that category.”

Lastly, Palalas notes differences in different provinces, something a large chain like High Tide is uniquely positioned to speak on.

BC, he says, is a difficult market for vapes because of a high retail tax and other product limitations. Meanwhile, provinces like Alberta and Saskatchewan take the lead in vape sales, while Ontario shows more willingness among some consumers to pay a bit more for higher-quality or craft-focussed products. 

“BC has been a challenge on vape, despite a clear consumer desire for all-in-one formats. British Columbia is a really challenging market for vapes because of the pretty onerous consumer vape tax. We do tend to index into pre-roll much heavier in that market. It is the leading pre roll market.

“Alberta is the second-largest vape market by share and number one by volume, with around 25-26% market share,” which he says “compares to Ontario at around a 21% share and Manitoba at about a 20% share.

“Definitely Alberta is a major ready-to-use market, notes Palalas, adding that he sees a lot of downward pressure on dried flower brands in Alberta and a decline in flower sales.”

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