Ontario Cannabis Store plans to overhaul wholesale markups

The Ontario Cannabis Store (OCS) said it is reforming wholesale cannabis markups at the expense of its own profits, a move intended to "help create a vibrant cannabis market." OCS, which is owned by the Ontario government, has a monopoly on supplying licensed recreational cannabis stores in Canada's largest provincial cannabis market. said in a statement Thursday, "Reducing margin levels is expected to help create a vibrant marketplace that will better compete with illegal operators." According to details released by the wholesaler, this will involve a fixed markup for each different marijuana product category, "calculated as a percentage above the CIF cost (including producer profit, excise tax) for the wholesale price." The specific markups will be made public, and OCS said, "Consistent with its commitment to social responsibility, OCS will reduce margins to encourage consumers to purchase safer forms of cannabis, such as edibles and topical cannabis. Dried flower will have the lowest margins of any product category and can effectively compete with the illicit market."

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