The biggest reason Terry is going to be crushed is his costs are going up. Unlike the US where weed is still illegal and there is still a grow op market outside of legal areas Canada will be legal everywhere.
This means that the number of wholesalers supplying Terry is going to drop significantly. The risk to the grow up will also be much higher as the government cracks down on illegal weed. This means Terry costs are going up. Now the number of people willing to be Terry’s will drop as enforcement increases. Marijuana laws have been unenforced even on the trafficking end since the liberals came to power. This has lowered the consequence of being Terry therefore increases competition and decreased cost.
So when weeds legal Terry’s wholesale cost is going up, his risk is going up, and his number of customers is going down. For him to stay in the business he has to raise his prices. As he raises prices his competitive edge disappears.
So if I’m a betting person I’m going with less illegal marijuana than illegal ciggerettes within 5 years. Once the US legalized marijuana the amount of untaxed weed sold in Canada will creep back up to ciggerette levels.
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