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Licences Types

Research & Development

Processing

INDUSTRIAL HEMP

OVERVIEW OF CANNABIS PROCESSING

Under Health Canada's Cannabis Act (2018) and Cannabis Regulations (2018), the control and production of cannabis are strictly regulated to ensure compliance across Canada's medical and recreational cannabis industries. Cannabis processing focuses on the manufacturing, packaging, and labelling of cannabis products.

A Processing Licence is essential for businesses looking to enter the cannabis industry. It enables them to produce a wide range of cannabis products, from oils and edibles to topicals and concentrates. Additionally, combining an Online Sales Licence with a Processing Licence allows direct sales to Patients and other intra-industry Licensed Holders.

CLASSES OF CANNABIS PROCESSING LICENCES

There are two main classes of Cannabis Processing Licences:

STANDARD PROCESSING LICENCE

Scope: This Licence is designed for large-scale cannabis product manufacturers. It allows for the processing of various cannabis products, including legal packaging and labelling for direct-to-consumer sales through authorized distributors and intra-industry operations. Market Opportunity: This opportunity is ideal for businesses that aim to produce and distribute large volumes of cannabis products to the broader market.

MICRO-PROCESSING LICENCE

Scope: This Licence limits processing to a maximum of 600 kilograms of dried cannabis (or equivalent) per year. However, if the Licence Holder also has a micro-cultivation Licence for the same site and the cannabis comes exclusively from that site, this maximum quantity does not apply. Market Opportunity: Suited for smaller operations focusing on niche markets or specialized products with lower volume production.

Licence. This includes tasks such as hiring staff, maintaining inventory, and ensuring compliance with all regulations.
Obtaining these licenses is essential to operating a cannabis retail business legally in Ontario. GrowLegally can assist you through every step of the application process to ensure a smooth and successful launch.

HOW GROWLEGALLY CAN HELP

At GrowLegally, we can handle every aspect of your application process, ensuring you receive your Retail Operator Licence, Retail Store Authorization, and Manager Licence(s) without hassle.

Once you're licensed, we offer comprehensive "Kickstart" services to set your store up for success.

Development of training programs for store managers and staff, along with daily operation manuals

Setting up accounts with the Ontario Cannabis Retail Corporation(OCRC) for cannabis inventory

Assistance with Point of Sale (POS) system setup

Merchant account setup with providers

Bank account setup

Establishing relationships with third-party vendors for cannabis accessories

Providing detailed market research and data specific to your retailstore's location

Helping develop a procurement list for your first purchase of cannabis products and accessories

INVESTMENT & RETURN

Starting a cannabis retail store requires an initial pre-operational capital investment, typically between $55,000 and $100,000. These costs generally include:

Rent/Carry Costs (First and Last + 3 months): Approximately$15,000 (We recommend keeping rent under $3,000 per month)
AGCO Licensing Fees: Around $10,000
Construction Fit-Out: Between $15,000 and $50,000
Inventory Purchase: Ranging from $15,000 to $30,000

With a conservative estimate, annual revenues for a well-run store in a decent location are projected to be between $650,000 and $1.2 million. Based on current market data and a lean operational structure, you can expect gross profits to be just under 30% to 40% of your annual revenue.

If you have any questions or need further details, please don't hesitate to reach out. We're here to help you succeed and look forward to welcoming you into the GrowLegally Cannabis Supply Ecosystem.

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Medical Cannabis Online Sales

On October 17, 2018, the Cannabis Act opened the opportunity for individuals or companies to apply for a Licence to sell cannabis online. Federal legislation allows the Online Sale of Cannabis for Medical Purposes. As of September 2020, there were over 377,000 registered Medical clients with federally licenced sellers in Canada.

A licence for the Online Sale of Cannabis for Medical Purposes allows the Licenced Holder to sell cannabis products directly to registered clients for medical purposes. Online Sale Licenced Holders may sell cannabis online, in written order, or over the telephone.

Application requirements for the Sale of Cannabis for Medical Purposes vary depending on whether they opt to take possession of cannabis at their facility. Operations involving the possession of cannabis will face more stringent requirements concerning security and storage. These additional requirements will entail guidelines detailing the cleaning and sanitation procedures for security storage areas, monitoring the storage area, and building security measures.

Authorized Sellers must obtain cannabis products from approved federally Licenced Processors. Registered clients must be authorized to use cannabis by a licenced practitioner. Cannabis products must be delivered to the clients via courier or securely through the mail.

A licence for the Sale of Cannabis for Medical Purposes would also provide authorization to perform other related activities, including:

Storage
Transportation
Possession
Destruction
Intra-Industry Sale to Other
Federal Licenced Holders
Federal Licenced Holders

Health Canada is responsible for licence approvals, suspensions, restrictions, renewals, amendments, and rejections.

As of 2020, the cost for medical cannabis was $7.05 per gram in Ontario instead of the average wholesale price of $4.20 per gram (OCS), representing a significant opportunity for licence holders to benefit from increased margins. The Licenced Holder may purchase tested and pre-packaged cannabis goods for resale to the medical market. This process will significantly reduce overhead costs and allow the operator to focus on e-commerce development.

“The total cannabis market in Canada is forecasted to generate $7.17 billion in revenue in 2019, with medical cannabis sales expected to account for up to $1.79 billion” (Deloitte). Contrary to initial hypotheses, the legalization of recreational cannabis has increased the number of medical cannabis users. Individuals are now more likely to engage in talks with their health care providers regarding the benefits of medical cannabis and available insurance coverage.

GrowLegally will work with your company from Seed to Success from Licensing to developing a strategic client acquisition strategy!