Cannabis companies facing 'crossroads' selling off stores, farms and warehouses
TORONTO - Cannabis companies are selling off growing facilities, stores and warehouses as they try to better align their offerings with demand.
Industry observers say demand for cannabis is high, but there are so many assets available for sale right now because companies have misjudged what consumers want.
They say companies are looking to off-load properties as they cut products and pivot toward items more likely to fly off the shelves.
David Hyde, chief executive and co-founder of Hyde Advisory and Investments Inc., says the sell-off is happening because companies are at a "crossroads" as they come to terms with the profitability, viability and challenges of the industry.
He says many have realized their business plans are not sound and that demand for particular products is well below their expectations, leaving them with a glut of pot to sell.
Others are struggling to stand out as the number of pot products for sale in the country swells, craft cannabis' share of the market grows and illicit sales remain strong.
This report by The Canadian Press was first published Jan. 13, 2022.
