Jones Soda Co. (CSE: JSDA) (OTCQB: JSDA) has taken aim at one of the lesser-developed product sectors in cannabis to date: THC-infused beverages. As one of the market leaders in the category on the West Coast, Jones Soda dove deeper into its expansion plans during its fourth-quarter earnings call last week, including:
- Expanding the number of infused drink flavors.
- Launching a new marijuana edibles product line.
- Entering at least two new states – Michigan and Nevada – on top of its current footprint in California and Washington state.
“We are thrilled to be at the forefront of what is proven to be a high-growth category,” CEO Mark Murray told shareholders during the call, noting that the broader cannabis drinks sector grew by 54% in 2022.
That said, beverages is still a very small category for cannabis, accounting for less than 2% of all sales in the U.S., according to data from analytics firm Headset. But many observers believe that translates to a large runway for growth.
Murray said that following the June debut of the company’s Mary Jones infused beverages in California last year, the company was able to get its products onto store shelves in 300 dispensaries across the state within four months, and the response thus far has the company excited to invest even more in the Golden State, with at least two more flavors of infused beverages yet to launch alongside their original four.
“While we are already the number one beverage brand in the 10- and 100-milligram carbonated beverage segment, we are only at 50% of our planned distribution capacity and expect to expand our reach to 450 plus stores by the end of (2023),” Murray said.
Not only that, but Jones Soda is also prepping an entrance into the California edibles market, which Murray said are expected to hit shelves in the next two to three months.
“We are thrilled about the opportunity to participate in the edible category, which currently represents 25% of the trade dollars in the cannabis market whereas beverages only account for 3% today,” Murray said.
“Our expansion efforts are just getting started,” Murray added, referring to Jones Soda’s cannabis division, and said the company has “signed contracts with partners to manufacture, distribute and sell our entire portfolio in Washington, Nevada and Michigan.”
Though the Washington expansion was announced in January, the entries into Nevada and Michigan had not been previously disclosed.
“While we’re already seeing encouraging results in California, we believe our potential for growth in the new states is fast,” Murray said. “We’re on the cusp of expanding the footprint of Mary Jones into several more territories and we are optimistic that as we scale our cannabis segment our growth trajectory will continue to steepen.”
“Our cannabis business is just getting started and early indications are very exciting,” Murray concluded.