Opening a cannabis retail store in Ontario requires a Retail Operator Licence, a Retail Store Authorization, and a sound location strategy. Ontario now has more than 1,500 cannabis stores, and the market continues to grow. The province had a slow start after the Cannabis Act passed in 2018, but private store licensing eventually opened the door to today’s thriving retail market.
But the road to a legal cannabis retail store in the province is complicated. Are you unsure where to start? Good news! You can start here.
The process is slightly different than in other provinces, but the fundamentals are the same: licensing, location, and building smart daily operations.
How Cannabis Store Licensing Works in Ontario
Ontario adds a secondary layer of authorizations beyond the typical licensing and permitting requirements in British Columbia and Alberta.
Anyone planning to operate a cannabis store must apply for a Retail Operator Licence and a Retail Store Authorization for each location.
How to Apply for a Retail Operator Licence
The Alcohol and Gaming Commission of Ontario (AGCO) is responsible for issuing operator licences under the Canadian Cannabis Act (2018). The AGCO subjects every applicant to strict eligibility requirements, including background checks for the applicant and key stakeholders.
The AGCO must be satisfied that you “exercise sufficient control” over the business and that you are not in default on taxes with the Canada Revenue Agency. The company must also not be owned by more than 25 percent by a licensed producer. Fees for the retail operator licence start at $6000.
How to Apply for Retail Store Authorization
Secondly, you’ll also need a Retail Store Authorization. Unlike the Operator Licence, this is on a store-by-store basis. If you are opening two locations at once, you’ll need to apply for two separate authorizations. As per AGCO, this step comes after the licensing.
This authorization covers aspects of the physical layout of the storefront and its location. We’ll get more into location below, but for now, you’ll just need to consider the provincial and municipal guidelines on where cannabis stores are allowed to operate. Plus, the application process mandates that you undergo a 15-day public notice process.
The AGCO recommends that you have already received approval for your new location from your municipality before applying. The AGCO also strongly encourages you to read through and adhere to the detailed requirements within the Registrar’s Standards for Cannabis Retail Stores.
Where to Open a Cannabis Store in Ontario
Where should you open a cannabis store in Ontario? First and foremost, you’ll have to be in a city that allows it.
Many of Ontario’s largest municipalities have completely opted out of allowing cannabis retail operations. In fact, according to the AGCO, more than 70 different cities and townships have banned legal cannabis stores from opening up within their city limits.
The good news? Over 300 places have welcomed cannabis with open arms.
Provincial and Municipal Location Rules for Cannabis Stores
Second, check out your local regulations. The province requires that stores open no closer than 150 metres from a school, with a few exceptions.
But your municipality will likely also have additional stipulations. For example, Ottawa requires that stores maintain a distance of 150 metres from recreational facilities, community centres, libraries, and active-use public parks.
Strategic location factors become the third consideration once you have municipal approval. Consider how much traffic is in the area (both pedestrian and vehicle), as well as nearby businesses.
Ask questions about who is in the neighbourhood and when. Will you hit a lunch crowd, an after-work crowd, or even the evening crowd? Are you around a university, industries, or office buildings? Knowing the local mix will help inform who your target audience is and when busy times are.
You’ll also want to consider your nearest competition. What do they do well? What can you do better? Answering these questions shapes your startup strategy in Ontario.
Building a Daily Operations Strategy for Your Cannabis Store
Daily operations planning is a critical part of building your cannabis store. For example, how do you manage inventory? How do you manage the back end of the business? What about signage?
Start building a comprehensive operations strategy as soon as possible. Envision all the major pieces you’ll need to run a cannabis store daily, from reporting to sales to administration. It will help you better understand your initial capital expenses and your ongoing operational expenses.
How TechPOS Supports Ontario Cannabis Store Operations
TechPOS has been helping cannabis stores get started in Ontario since the very beginning.
The TechPOS all-in-one ecosystem is a comprehensive solution that does more than just ring through sales. This omnichannel system makes inventory management, compliance reporting, and staff management easy. So instead of trying to piece together a series of disparate systems, you hit the ground running with one.
Opening a Dispensary in Ontario: Next Steps
Ontario is in the news because it currently boasts the most cannabis stores in the country — but there will always be room for newcomers and disruptors. So long as you adapt to the lessons learned from those before, you’ll be able to hit the ground running as you open your doors.
There are three fundamental takeaways about opening a cannabis store in Ontario:
- Understand the licensing process, including the expected wait times.
- Choose your location wisely and use that intel to determine your unique competitive differentiation.
- Strategize day-to-day operations long before opening day to better grasp CapEx and OpEx.
Interested in an all-in-one business solution that is already working for cannabis stores in Ontario? Schedule a demo with TechPOS Today.