Regarding pricing I could reply to a couple individual comments here specifically, but this is a long thought. (Maybe it's own post? There are enough weed discussions already?)
(TL/DR I think bulk pricing (1oz) should be in the $6.13-$8.18 +GST/g range to beat, match or be competitive with the black market.)
I hope past and current customers as well as the licensed producers will chime in. I'm just talking recreational, medicinal users should be paying much less than what I am discussing here.
I'm not the best at math, so there are certainly calculations here that are going the be off, I just want to get this conversation started, please correct me where I am wrong. I'm not looking for math lessons, just answers.
I've never participated in the production or distribution side of cannabis. I have enjoyed some from time to time though. I don't know what the actual costs of producing are, but from what I understand it is likely in the $1-2/g range.
Black Market Producer (BMP) costs and Licensed Producer (LP) costs are going to be different for a number of reasons. There has to be some balance somewhere though, it's not like the black market was only doing this for peace and love, they were making money at all levels of the game.
In my recent experience, let's say the last 10 years, the price for one ounce (28g) would range from $180-$280. Both extremes of the scale were as extremely rare. I have been lucky to have several steady sources at $200/oz. In a pinch a couple options at $220.
$6.43-$10/g TOTAL. All in. And good shit. in all price ranges I have very few complaints to be made.
- They say they want to BEAT BMP pricing? In my opinion they have to match or come under what I was spending, TOTAL. Taxes incl. I'm sure there is still money to be made.
I think they could have 4 reasonable bulk pricing points here. There should be bulk pricing, if not $6-$9/g should be the pricing, the end.
$6.13/g x 28 + GST = $180.22
$6.81/g x 28 + GST = $200.22
$7.49/g x 28 + GST = $220.21
$8.18/g x 28 + GST = $240.49
by all means, charge $7-$18/g for a single up to 3.5/g. those are convenience, party, gift items. MAKE MONEY THERE. Make money on impulse buys, accessories, lifestyle, etc.
7g should range from $50-$80 TOTAL
14g $100-$150
28g $180-$240
This is just bud. There are so many more items to come. Money is to be made. If they could get their bulk bud prices into this range I can't imagine who would be able to argue?
That said I have to experience with MOMs. I understand you can get ounces from $99 and up...
There's a lot to factor in to doing this legally. They have store fronts, websites, employees in the store, on the floor in the factory, accountants, lawyers, etc, etc, etc. This is a different, new business. But MOMs and pot shops have already existed.
So if producing a gram of cannabis is $1-$2, let's just bump that up to $3/g cost. Now factor in Federal and provincial mark ups (the real reason prices are currently higher than black market) :
+$.0.75/g to: LGCA $0.75
+ 9% to: LGCA $0.27
+ 6% SRF to: MB $0.18
+ 5% GST = $0.15
= $1.35 /G
So that's already $4.35/g. Obviously those numbers change when you factor in real costs, pricing, LP mark ups. At a minimum that is where your money is going. Again, not good at math, wanna discuss and make sure we're not taken for suckers. New users shouldn't be getting ripped off