Pita Pit, WeedMD join forces to create pan-retail franchises


Pita Pit has more than 225 locations in Canada, including this one in Richmond Row, London. The company has partnered with WeedMD, a London-area marijuana producer, to form Pioneer Cannabis Corp. The newly formed company will advise clients who want to open marijuana retailers. DALE CARRUTHERS / LONDON FREE PRESS

A southwestern Ontario marijuana grower and fast-food chain have teamed up to open dispensary franchises across Canada, an agreement that marks the second partnership between a Canadian marijuana company and a restaurant operator.

WeedMD, a licensed marijuana producer with operations at Strathroy and Aylmer, and Pita Pit Canada, a franchise with more than 600 locations around the world, have launched Pioneer Cannabis Corp.

"This is a very capital-efficient partnership, through which we leverage our individual marijuana expertise," Keith Merker, WeedMD's chief executive, said on Monday.

Pioneer Cannabis will help customers open and operate marijuana retail stores through services such as location identification, requisition of necessary licenses, guidance on safety procedures, point of sale merchandising, payment systems, marketing and training.

"Pita Pit has a long history of success in the franchising and retail environments," Merker said. "They have a huge network. . . of both franchisees, as well as owners and suppliers. "

WeedMD will hold a 9.9% stake in Pioneer Cannabis stores in provinces like Ontario – one of six provinces that allow private retailers – where licensed producers are restricted to having less than 10% of dispensaries.

"Pioneer brings an opportunity for entrepreneurs interested in joining the cannabis industry but who may not have the financial support or operational experience to open their own retail marijuana store," said Kristie Smith, former senior president of Pioneer Pit. , said in a statement.

"Through this collaboration of established Canadian companies, we are paving the way for small businesses to participate in the emerging cannabis retail space that will foster local economic growth and opportunity."

The news of the company's creation came on the same day that Ontario announced the 25 individuals and companies that will have the chance to sign up for one of the first cannabis retail licenses.

Seventeen of the 25 winners are sole proprietorships, suggesting services like Pioneer Cannabis may be in demand as entrepreneurs rush to open shop windows by April and avoid heavy fines. Carriers that do not open on April 1 will be fined $ 12,500, while those not yet on the market by the end of the month are expected to pay $ 50,000.

But Merker says Pioneer Cannabis is not actively courting the lottery winners, as some marijuana companies have been doing in the days following the announcement by the Ontario's Alcohol and Gaming Commission, the province's retail marijuana regulator, on Friday.

"We tried to play a longer game. . . against going out and spending millions of dollars to get one of those lottery winners, "he said.

Founded in Kingston in 1995, Pita Pit has more than 225 locations throughout Canada, including three in London.

However, there are no plans to convert any of the restaurants into marijuana retailers, Merker added.

Last year, the Canadian coffee network Second Cup partnered with National Access Cannabis (NAC), a company that operates medical marijuana clinics across the country and 20 dispensaries in Manitoba and Alberta, with plans to convert some of Ontario's coffee shops in marijuana stores.

But plans were canceled last month after the progressive conservative government announced that only 25 retail licenses would be awarded to open brick and mortar stores in April, reversing its promise to issue an unlimited number of licenses.

The NAC was among more than 17,000 enrolled in the AGCO lottery, but was not selected.

More retail licenses for Ontario will be issued in December, although no other details have been provided.



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