Crystal Schick/Yukon News Allister Kucheream, left, and Dave Galbraith of Kelly Construction prepare to hang the Cannabis Yukon storefront sign in Whitehorse on Oct. 17. The territorial government is beginning to plan to shut the store down.

YG moves to close its physical cannabis store as private market emerges

Minister John Streicker said the government anticipates the store to be closed by the end of 2019

The Yukon government has began the process of shutting down its cannabis store in Whitehorse as more private retailers entire the market.

John Streicker, the minister responsible for the Yukon Liquor Corporation, told the News in an interview Aug. 12 that he expects the territorial government’s physical store, located in the Marwell area, to be shuttered by the end of the year, if not earlier.

“It was always the plan (to close the physical store) and here we are,” Streicker said.

The news comes on the heels of the opening of the territory’s second private cannabis store, located in Dawson City (the first opened in downtown Whitehorse in April). There are also at least two other businesses that have applied for licences — one in Carmacks, and another in Watson Lake.

Streicker said that the government’s decision to begin shutting down its own store was not so much based on a certain number of private stores popping up than the government feeling confident that a strong private market was being established.

The Yukon government took things like the distribution of stores around the territory and the creation of “some competition” — particularly against the black market — into account when evaluating the strength of the private market, he explained.

“This is a very unique business situation because you’re competing against the black market, and so as private retailers come on board, we talk to them about wanting to work with them to help us to achieve our goals,” Streicker said.

“So it wasn’t so much about a number (of private stores), it’s, we needed those conversations to happen and to feel like those people, those retailers, are going to help us to achieve our goals, and that is happening now so we feel confident about that we can step back.”

The Yukon government is now considering two options on how to wind down operations at its physical store — either selling the entire store to a private retailer, or selling off the store’s assets.

“When we built the store, we built it with this thought in mind that … we were not going to be running it forever, so we made sure that we built things in a modular fashion so that we could just sell them off if (we don’t sell the whole store),” Streicker said.

The Yukon government will continue to operate its online store after the physical store closes and remain the territory’s cannabis wholesaler, as well as maintain enforcement activities.

“We’re going to continue to have this role to make sure that things are safe and that we’re displacing the black market, and we’ll let the private sector deal with the bulk of the sales,” Streicker said.

According to data from Statistics Canada, Yukoners purchased more than $2 million worth of cannabis between December 2018 and May 2019.

That works out to about $49 per Yukoner, making the territory’s residents the top spenders on cannabis in Canada in that timeframe when adjusted for population.

In second place was Prince Edward Island, whose residents spent an average of $46.40 per person.

Contact Jackie Hong at jackie.hong@yukon-news.com

Correction: A previous version of this story incorrectly reported that Manitoba citizens, on average, had spent the second-most on cannabis, when adjusted for population, in a six-month period.

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