Shopify Locking Up Canadian Cannabis Market
Online retail giant Shopify has been cutting huge deals with Canadian provinces and cannabis producers to set itself up as the largest cannabis point-of-sale and inventory management platform, reports The Motley Fool.
Shopify has signed contracts with the provinces of Ontario and British Columbia, as well as with Aurora Cannabis, Canopy Growth Corp., Hydropothecary Corp., and others. Shopify's deal with Ontario was made direct with the government, placing Shopify squarely in the middle of the entire cannabis industry in that province, while Shopify will function as an inventory-management go-between in British Columbia, where cannabis retail will be privatized. Aurora Cannabis and Hydropothecary Corp. are expected to be the two largest producers of cannabis in Canada once the legal market is in full swing.
Shopify's dealings in Canada may position the company for developing a first-mover advantage when cannabis becomes federally legalized in the U.S.
Shopify's sales are expected to top $1 billion this year alone. The company's software-as-a-service platform dominates in a wide range of markets, but its move into the cannabis space is not expected to significantly increase total revenue just yet — though analysts predict that, by 2019 or 2020, these cannabis deals may begin to contribute significant revenue to the company's annual total.
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