For retailers of cannabis, 2020 likely marks a temporary high point, according to new figures from Statistics Canada.
Year-to-year sales of cannabis as measured in dollars roughly doubled in 2020, from about $148 million in December 2019 to $298 million in December 2020. It is important to point out that cannabis retailers currently account for a tiny share of overall retail following the legalization of cannabis sales in the fall of 2018. Retail sales in December 2020 alone totalled $53.4 billion and $606 billion for all of 2020.
No account of Canadian retail would be complete without considering the effects of the COVID-19 pandemic. Compared to 2019, retail sales were down 1.4 per cent in 2020, the largest annual decline since the 2009 recession, as governments responded to the start of the COVID-19 pandemic with temporary measures that forced retailers to shutter their doors, many for forever.
The trend line for retail sales shows a steep decline in the spring of 2020. Whereas total retail sales for February 2020 totalled $52.2 billion, that figure had dropped to $35.3 billion by April 2020. An equally steep recovery followed as governments revised public health measures. Retail sales reached $52.3 billion by June 2020 and peaked at $55.2 billion in November before declining again in December as new public health measures responded to the second COVID-19 wave.
Looking at figures for December, the most important month for many retailers, total sales dropped to $53.4 billion, down 3.4 per cent from November 2020, as nine out of 11 sub-sectors representing 83.6 per cent of total retail sales recorded lower figures.
Looking at specific sectors beyond cannabis, clothing stores and clothing accessories stores, health and personal care stores, and to a lesser degree sporting goods, hobby, book and music stores saw major declines. Food and beverage stores (including liquor stores) and general merchandise stores saw increases, partly because of record sales in March 2020 amid what Statistics Canada calls “panic buying of non-perishable goods” (read: toilet paper) during the early stages of the pandemic, partly because Canadians spent a lot more time at home.
The pandemic also accelerated e-commerce, accounting for 5.9 per cent of total retail sales in 2020, up from 3.5 per cent in 2019 as the Canadian retailers opened or expanded their e-commerce presence.
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