Farm-gate is a new type of retail which allows licensed producers to sell product from on-site storefronts. The program was first introduced in Ontario early this year and will be rolled out in B.C in 2022, with many other provinces considering piloting the program. Instead of buying cannabis from a dispensary or online through the provincial store, farm-gate allows for the sale of cannabis directly from the licensed producer. This changes the buying process for consumers who have greater purchasing choice and by making cannabis retail more of an experience similar to a winery or craft brewery.
Why has farm-gate been proposed? The cannabis industry lobbied regulators for farm-gate to improve sales into the legal channels. Selling directly to consumers helps licensed producers to mitigate distribution challenges to their customers. Despite there now being over 1000 licensed stores in Canada, the majority of those are in cities, which leaves sales in rural areas a continuing issue. Cannabis communities are searching to support locally grown product. Farm-gate allows these communities a more efficient and personal way of receiving products.
Benefits to the Cannabis Community Just like wine tasting tours at vineyards, farm-gate presents the cannabis industry with tourism opportunities. This not only creates new jobs but also helps normalize the industry and increase tax revenue. Farm-gate encourages consumers to buy local, benefiting smaller producers who have struggled to gain a foothold in a market dominated by big business. Bypassing supply chains allows farmers to provide consumers with fresher cannabis and attract them to the legal market. Farm-gate allows customers to be fully engaged in their purchase through tours which allow you to not only view the licensed producer growing location but also to even meet the master growers who grew the product. Not only is this exciting, and informative for the customers but it helps to develop customer loyalty as well as branding for the licensed producer.
Application Process In order to apply for a farm-gate retail licence you must first hold either a standard cultivation licence or a micro licence. The application process consists of two components, obtaining a Retail Operators License and then gaining Retail Store Authorization for the proposed location. Once an application for the Cannabis Retail Store Authorization has been submitted to the AGCO, a 15-day public notice begins. The registrar will then evaluate the application taking into consideration community feedback. For a licensed producer to be authorized for farm-gate, several obligations must first be met including site security designs, physical security plans, and an organizational security plan. There must also be physical separation of provincial and federal products. This can be accomplished by having separate storage areas for product to be sold on site versus product that is to be sold through the Ontario Cannabis Store and online. Farm-gate is a new way to benefit both the customer as well as the licensed producer. It is an engaging and exciting way for customers to become more involved and knowledgeable in their cannabis product purchase. The program can help to build a strong connection between producers and their customers which the standard retail model fell short on.
To speak with a member of the Mariwell team about the farm-gate program and our products, get in touch HERE