Online marijuana platform Leafly has partnered with delivery service Uber Eats to offer cannabis delivery orders through the high-profile Uber Eats smartphone app in Toronto, the most-populous city in Canada.
The delivery ordering service, which began Monday, is the latest example of a cannabis play by a mainstream business such as Uber.
Any expansion plans into other parts of Ontario “will be based on how things go” with the initial group of participating Toronto retailers, an Uber Canada spokesperson told MJBizDaily.
“We want to get the experience right for the consumer and the retailer and ensure it all happens compliantly,” the spokesperson noted in an emailed statement.
The deal will allow Uber Eats users to place cannabis delivery orders through the app, but those deliveries can’t be fulfilled by Uber Eats couriers: Per Ontario regulations, they must be delivered by the cannabis store’s own staff.
Those drivers will be required to verify customers’ “age and sobriety” upon arrival, according to the Uber Canada news release.
Leafly already works with more than 200 licensed cannabis retailers in Toronto, according to a spokesperson.
“Because we already have relationships with these retailers, have vetted them to be on our platform, and many of them use our technology solutions for menu integration, we have an existing network of trusted retailers to potentially work with as part of this partnership with Uber Eats,” the spokesperson told MJBizDaily via email.
Uber Canada would not say what commission it charges for delivery orders through the new service, but the company’s spokesperson wrote that “different merchants choose or negotiate different arrangements.”
‘The publicity trumps the cost’
Independent retailer Minerva Cannabis is one of three Toronto marijuana stores that have signed up for the Uber Eats delivery-program launch, alongside Hidden Leaf Cannabis and Shivaa’s Rose.
Minerva President Paul Macchiusi said his downtown store competes with 14 other cannabis retailers within a 2-kilometer radius – including two illicit operators – illustrating Toronto’s cutthroat cannabis retail market.
Listing deliveries with Uber Eats is “significant because of the size of the digital marketplace that Uber Eats provides us,” Macchiusi told MJBizDaily on Monday.
“We haven’t been able to speak to this many people in the city, at this fast of a rate, ever before, given the regulations on advertising and marketing.”
Macchiusi said Minerva previously offered deliveries on a more limited basis.
“But now that there’s a demand for it, we believe that we should be able to offer full-time (deliveries) seven days a week.”
He said Minerva recently hired a full-time delivery driver.
Macchiusi acknowledged that partnering with Uber Eats has a cost, although he couldn’t disclose details.
“But for us right now, the publicity trumps the cost,” he added.
Cannabis delivery not new for Ontario
In its release, Uber Canada described the deal as “the first time cannabis delivery will be available on a major third-party delivery platform in the world.”
However, the Uber Eats-Leafly deal does not represent the first smartphone app-enabled cannabis delivery service in either Canada or the United States.
Nor is the deal with Leafly-Uber Eats’ first foray into the Canadian cannabis market: Uber Canada already has a deal to process click-and-collect orders for Tokyo Smoke cannabis stores in Ontario.
Many Ontario cannabis stores offer their own delivery programs, as well.
The Ontario government first permitted cannabis stores to offer deliveries and curbside pickups during the early stages of the COVID-19 pandemic.
Delivery and curbside pickup were made permanent this past March, but they must be associated with specific retail locations, ruling out delivery-only businesses.
Torontonians spent 54.1 million Canadian dollars ($39.4 million) on legal adult-use products in July, or roughly one-third of Ontario’s total cannabis spending that month, according to the latest retail sales data from Statistics Canada.
Solomon Israel can be reached at solomon.israel@mjbizdaily.com.
