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WINNIPEG, Oct. 24, 2018 /CNW/ – DELTA 9 CANNABIS INC. (TSXV: NINE) (OTC: VRNDF) (“Delta 9” or the “Company”), through its Delta 9 Cannabis Store subsidiary, logged close to 9,600 transactions in the first seven days after legalization of cannabis on October 17, totaling $736,124 in revenues up to the end of day on Tuesday this week.
The vast majority of revenues are attributable to sales of dried cannabis products, with the remaining coming from the sale of ancillary products and accessories. Average selling price per gram of dried cannabis sold over the first seven days of sales was approximately $11.47, with the average cost of sales for a gram at approximately $8.64.
“The first day of legal recreational cannabis sales blew away all of our expectations,” said John Arbuthnot, Chief Executive Officer. “We launched online sales of cannabis just after the stroke of midnight on October 17, and in the first minute logged more than 100 sales to customers in Manitoba. By 4 a.m., we had sold out all the product set aside for online sales, but even that was nothing compared to the experience at our first retail store in Winnipeg.”
Despite restricting online sales to 10 per cent of the Company’s initial in-store inventory, Delta 9 logged 1,583 online orders, of which 961 were sent by Canada Post, and 622 were sent via Pineapple Express for same day delivery in Winnipeg.
Chief Technology Officer Matthew Sodomsky said Delta 9 was able to meet the massive online demand thanks to its partnerships with Pineapple Express and Shopify. More than 91,000 unique website visitors were logged on the delta9.ca website, which runs on the Shopify online platform.
“Selecting Shopify as our technology partner was definitely the right decision.” said Sodomsky. “We were able to process thousands of orders on legalization day, while upholding our commitment to protecting our customer’s data, storing it on a 100 per cent Canadian-hosted solution.
“Shopify is the glue between Delta 9 Cannabis and Pineapple Express Delivery, allowing us to provide high-quality cannabis and accessories to our customers in their homes in as little 30 minutes.”
“We are excited to be working with Delta 9 to provide a tailored customer experience to meet the unique demands of both consumers and regulators as we power this new industry.” said Loren Padelford, VP and GM at Shopify.
The Delta 9 Cannabis Store in the St. Vital area of Winnipeg also recorded 8,017 sales in the first five days, with revenues of $572,454. The average online order this week was $104, while the average in-store order came in at $72.
The first customers for the Delta 9 Cannabis Store were seen camping outside the shop by 6:30 p.m. on October 16, and as the sun rose on October 17 hundreds of eager buyers were lined up around the building. It was just the first of several thousand sales at the Delta 9 outlet. Long lines continued throughout the day, extending completely around the building, with early customers patiently waiting up to two hours to buy their first legal, recreational cannabis products.
“We expected high volumes for both online and in-store sales, but what happened this week went beyond even our most optimistic projections,” Arbuthnot said. “We handled close to 2,000 sales by late afternoon, and even bigger crowds began arriving in the evening as people started arriving after work. We were starting to worry that everything in the vault would be cleared out by end of day.”
While outlets across Canada have reported shortages of product, Arbuthnot says Delta 9 continues to enjoy a robust supply, particularly from its own production facility in Winnipeg.
“We’ve been working very hard to increase production over the past year, and that work is paying off now as we face huge demand from the recreational market,” said Arbuthnot. “I’m happy to say Delta 9 has adequate supply, and we are even now preparing a large shipment to our store and to our wholesale customers.”
Delta 9 is taking in three shipments of dried bud, cannabis oil, and gel caps from its suppliers, including Broken Coast and Canopy Growth, and will be shipping approximately 200 kilograms of Delta 9 product to Manitoba Liquor and Lotteries later this week.