Although cannabis has been legalized in Canada for almost a year, rumbles persist about supply shortages in both the recreational and medicinal markets. While recently released data from Health Canadashowcases strong growth in cannabis sales across the country, consumers provinces-wide continue to gripe about inefficiencies and dissatisfaction with regard to quality, product availability, pricing and delivery.

Looking to help fill delivery gaps, more delivery service models are trying their hand in Canada to help medical and recreational consumers get the products they want more quickly. The bigger question that some may have, however, is whether these services are legal and exactly how do they work?

Knowing the rules will ensure buyers access legal sources

“Different provinces may have different rules about what is permissible,” explains Caryma Sa’d, a cannabis lawyer in Toronto. “As far as I’m aware, in Ontario, dispensaries are not allowed to have an online delivery presence, but LPs (licensed producers) are,” Sa’d says.

One such third-party logistics company that LPs can team up with on delivery is Pineapple Express Delivery. To date, the company has set up delivery services in Ontario, Manitoba and Saskatchewan for medical patients, offering same-day service on behalf of legal cannabis producers, including among others, Green Relief and CannMart Inc. in Ontario, and Hiku Brands Company Ltd. and Delta 9 Cannabis in Manitoba.

Some people may not even realize when they are ordering from grey-market sites, with CBC reporting that a cannabis delivery person was arrested in early August with 247 g of marijuana in Hamilton, Ont.

Sa’d acknowledges that people ordering online should be aware where the purchase is from, noting that “age verification will need to be an important part of the delivery process, not just upon purchase, but also to the delivery person. It can be a system that could be prone to abuse by people who aren’t yet of age.”

Delivery is about more than convenience for medicinal users

For many medical marijuana users, cannabis delivery can prove the difference between getting their medicine that particular day or not, which highlights the importance of these services for some. In Ontario currently, the Ontario Cannabis Store (OCS) sells cannabis for personal use online. If cannabis is shipped via Canada Post’s standard delivery service, a $5 flat rate is applied and receipt then takes two to threebusiness days.

However, not all medical cannabis users are able or have ready access to the post office on their own, or if Canada Post is delivering directly to their homes, may not hear a doorbell and end up with a slip at their door.

Some people using the plant for pain relief, for example, are seniors who may be homebound, live in remote areas or are unable to drive. Cannabis delivery can be helpful for those wanting to be free of postal delivery constraints.

Canadian rules can make cannabis delivery a tough nut to crack

“A lot of people don’t realize how many details go into distribution; it’s not as clear cut as some of the other services,” says Sarah Seale, a managing partner with Cannabis Management Resources Inc., and interim general manager for Pineapple Express Delivery.

Seale believes that for those who have done competitor analysis on what is happening in the U.S. and overseas, “they’ve tried to set up an Uber-style method of cannabis delivery. This model is app-based and depends largely on the crowd-sourcing model as a business strategy. That kind of cannabis delivery model, here in Canada, is just not compliant with Health Canada. They won’t allow it,” she argues.

Seale tells The Growth Op her understanding is that there have been companies that have tried to set up their businesses in Canada, but soon realized they were not compliant. “There are different licences and models required in each province that require a nimble business strategy among other factors, such as insurance considerations and strategic partnerships with licensed producers,” she says. “It is not a simple nor inexpensive model that can be set up quickly.”

Company sets sights on cannabis delivery

In March, ParcelPal Technology Inc., whose app offers food, alcohol and grocery delivery, announced it planned to add cannabis to its roster. In April, the company partnered with Vancouver-based cannabis brand Kiaro to provide delivery in Saskatoon, Sask. In a press release, ParcelPal president and CEO Kelly Abbott said, “Customers no longer have to wait for upwards of a week to safely receive their product. We are now one step closer to becoming the Uber of Cannabis in Canada.”

And in mid-July, the company announced late-stage planning for implementation of cannabis delivery in Ontario, aiming at Canada’s financial capital, Toronto, as its initial launching point. There are not yet further details on a partnership or launch date, although ParcelPal did note in July that it was “expected to occur shortly.

Pineapple Express Delivery opts not to identify with the Uber model, says Seale, adding that this has more to do with the security and safety of its drivers and customers. “When you model after the Uber system, it’s called crowd-sourcing, and, basically, anybody can sign up to be a driver,” she says. Each of her company’s experienced delivery drivers are permanent employees who have undergone a full criminal background check, full security check and employment references, she notes. “From a security point of view, we know who is handling the product, each and every single day,” she adds.

“Each province has its own set of rules around recreational delivery. Right now, we are licensed and allowed to deliver in the Manitoba and Saskatchewan provinces,” Seale says. “The other provinces have not released any definitive information yet on their timeframes, but we do hope to see this in 2020.”