Pita Pit is jumping on the cannabis bandwagon. This week, it was announced that the food chain struck a deal with WeedMD inc, a cannabis company in Canada to open a new venture.
Together the companies will be opening Pioneer Cannabis Co. Inc., that will be focused on helping entrepreneurs open cannabis stores in the private market.
"Our objective is to be a competitive player in this marketplace as it grows," said Jordan Schwartz, chief executive officer at Pioneer Cannabis Co. Inc.
When Canada legalized cannabis last October, distributors were battling it out to get product, especially in the private sectors. There are two markets when it comes to Canada's new cannabis industry- the private cannabis market and the federal government-ran market.
Multiple provinces in Canada, including Alberta, have opted to have private retailers sell cannabis versus having government-controlled stores.
But Provinces with the government-controlled stores have also struggled to meet the demand for cannabis. Stores in Quebec, for example, have been restricted to open for just four days a week in the past.
Pioneer Cannabis Co. Inc. will be focusing on the private sectors. Even with the cannabis shortages and the initial operational challenges of the new industry, Pioneer and Pita Pit see a lot of potential in this retail market.
"We believe that there's capacity here for the retail network that we're servicing to generate sales in the $30 million to $50 million range that shows profitability and demonstrates that there's a sustainable business here," said Schwartz.
Pita Pit, which has 225+ stores in Canada, plans to use its franchise experience to attract business owners who want to get into the booming cannabis industry.
"We’ve spent years learning and perfecting the skills we have in our businesses such as finding locations and hiring people," said Chris Fountain, chief executive officer of Pita Pit to "BNN Bloomberg" in a phone interview. "Quite frankly, it's probably a once-in-a-lifetime opportunity for something like this."
WeedMD will have a 9.9 percent stake in most of the Pioneer Cannabis stores and the rest of the stake will be divided by Pita Pit and the store franchises.
Learn more about the partnership at "BNN Bloomberg" now.
The edible cannabis market is exploding in both the U.S. states where cannabis is legal and Canada. Listen to this recent episode of The Barron Report below where Host Paul Barron discusses with Nancy Whiteman, founder and CEO of Wana Brands about what the future of the cannabis industry looks like in both the U.S. and Canada and how it will impact the foodservice industry.