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Over the weekend, I visited Kamloops and decided to stop by the one and only cannabis store in the province, in part because I wanted to see what it was all about and what it looked like, and because I was going to look for a cannabidiol (CBD) product for someone I know.
It was an interesting experience, and there were four things that got my attention.
Security is a big deal
From the outside, the store resembles more of a nightclub than the liquor stores operated by the province. Two security guards manage the flow of traffic, and after driving by multiple times during the day, I’d estimate lines of anywhere from 30 to 50 people. On my visit, the line was a bit shorter than normal, but not by much, and I still ended up waiting about 40 minutes just to get in.
And that was a little surprising because once inside, I had noticed that the store had limited the number of customers to about a dozen or less. This seems a bit extreme given the product is tucked away, and you have to write down the sku and quantity of what you want to purchase for the cashier to get it for you once you’re at the till.
When you get into the store, you also need to provide two pieces of identification, rather than just showing it when you make the purchase, as you normally would when buying alcohol.
The demographics are what you would expect
For all the hype about new users coming out of the woodwork to try cannabis now that it’s been legalized, I haven’t seen that to be the case. While I did see one grey-haired person in the line behind me, by and large, from what I saw, the customers were mainly under the age of 35 by my estimate and knew of the products that they were looking for.
It’s all about recreational purchases
I was looking for a CBD-based product, and I asked the one attendant that was there to assist for help, only to discover there was only one product that would fit my criteria — providing pain relief without a high. The lady that helped me was even taken aback that I had waited so long and only been looking for a medicinal product. Clearly, the store didn’t anticipate much demand for medical marijuana, nor was it expected that it needed to be either.
Complete lack of branding whatsoever
The CBD capsules that I was looking for were made by Aurora Cannabis (TSX:ACB), but you wouldn’t be able to tell from the packaging. With no logo found anywhere on the box, customers will have to take some effort in finding a specific brand. While it does say “Aurora” on the front of the box, that’s the only hint as to the company behind the product.
Given its recent acquisitions in the space, it doesn’t come as a surprise to me that Aurora made the CBD product I was looking for. However, it does reaffirm the concerns and limitations that big brands like Aurora will have in trying to create any brand loyalty and any type of association.
Bottom line
Visiting the store was an interesting experience and allowed me to gain some insight into its operations and clientele. It’s still early but the hype is clearly there, and there’s a lot of demand. However, with few new cannabis customers from what I can tell, there may not be the massive growth that many pot stocks are banking on.
Fool contributor David Jagielski has no position in any of the stocks mentioned.