Nearly one year later, still no decision on privatizing Cannabis NB

| David Brown

It’s been nearly one year since New Brunswick first announced they were seeking proposals for a single private operator to take over the operation, distribution and sales of recreational cannabis in New Brunswick, but no decision has yet been announced. 

On November 14, 2019, the province issued the request for proposals (RFP) to take over Cannabis NB, the provincially-run cannabis distribution and retail chain of 20 stores, and introduced amendments to the Liquor Corporation Act to facilitate the potential change on November 22.

The reasoning given by the government at the time for this proposal was that Cannabis NB was losing money, although the crown corporation has since then shown increasing profits as sales increased and it recouped initial startup costs

“This is part of our efforts to energize the private sector, get our financial house in order and maximize the benefits for taxpayers and the government,” said Finance and Treasury Board Minister Ernie Steeves in November, 2019 . “After a careful and thorough review of the current business model for the sale of recreational cannabis and an analysis of alternative options, we came to the conclusion that the best approach for New Brunswick taxpayers and government is to turn to the private sector.”

By January 13, 2020 the province announced that eight proposals had been received in response to the RFP, from Canopy Growth Corp, Fire & Flower Inc., Green Stop Cannabis Ltd, Kiaro Brands Inc., Loblaw Companies Ltd., New Brunswick Association of Cannabis Distributors, RSL NB, and YSS Corp.

At that point, the provincial government said they expected a decision by Spring 2020. Then, partially due to COVID-19, the decision was delayed until the summer, and then again delayed until after a provincial election on September 14. 

In September, Jennifer Vienneau, Director of Communications for the New Brunswick Finance Treasury Board, told StratCann that an update on the decision to privatize Cannabis NB would come following the swearing in of a new government. That swearing in took place in late September. 

A government representative shared with StratCann on October 26 that no new information is available. 

Cannabis NB’s most recent quarterly report showed a profit of $3.3 million from sales of $20.1 million.

Currently, all provinces and territories in Canada have a provincially-run distributor except for Saskatchewan and Nunavut. Alberta, Saskatchewan, Manitoba, Ontario and Yukon have exclusively private retail stores, while BC has a mixed model of public and private stores. Quebec, PEI and Nova Scotia have publicly run stores.

The Northwest Territories sell through five liquor stores and online through the government distributor. Nunavut recently opened up their territory to private retailers. Only one has applied so far, and has not yet been fully approved to open.