Covid 19 Archives - Green Market Report

Julie AitchesonJulie AitchesonJune 1, 2020
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7min4890

With terms like “social distancing”, “quarantine”, and “safer at home” orders now common parlance thanks to the Covid-19 global pandemic, it seems an odd time to forge ahead with opening new retail establishments, yet several determined cannabis companies are betting on a better future and doing just that.

 Small business website “The Balance” itemizes the expenses associated with opening a storefront, which include licensing fees, rent, inventory, staffing, and equipment to name a few.  To open even a small business in an inexpensive city or town can cost thousands of dollars. Factor in the extra costs retailers will have to swallow to stay within Covid-19 guidelines for reopening such as plexiglass cashier guards, protective equipment for staff, and restrictions on the number of customers allowed in the store at any one time, and the overhead becomes untenable for many current and aspiring shop owners.

New Dispensaries

Despite these factors, companies like cannabis product manufacturer Green Thumb Industries, cannabis testing laboratory Cannasafe, and cannabis retailer Canna Provisions are expanding their enterprises.

Green Thumb Industries (OTC:GTBIF)  announced that it would be opening its fourth retail location in the Las Vegas, NV area on May 13, as well as the eighth store in Illinois on May 28. This makes for a total of forty-five storefronts nationwide for Green Thumb, with four new locations opening since the Covid-19 crisis began. 

Green Thumb’s approach involves an emphasis on efficient curbside pick-up and delivery strategies to safeguard customer and staff safety. In a May 26 press release about the new Illinois location, Green Thumb Industries founder and chief executive Ben Kovler stated that his company has “continued to move forward through the ongoing COVID-19 crisis to provide jobs and much-needed access to well-being through the power of cannabis during these difficult times, as demonstrated by the opening of Rise Niles, our fourth opening since the crisis began.”

Cresco Labs  (OTCQX:CRLBF) opened Sunnyside River North, the first Illinois adult-use dispensary in Chicago in the prestigious River North neighborhood. Sunnyside opened for adult-use cannabis sales on May 28th for online orders and in-store pick up that day through a pop-up retail experience. “We are thrilled to be opening the first adult use store in Chicago under the state’s new legislation and to provide an example of what normalized and professionalized cannabis looks like with a location in a traditional business district, a local and diverse operating team and a tremendous amount of community input and support,” said Charlie Bachtell, Cresco Labs’ CEO and Co-founder.

Cresco Labs has said it has implemented procedures system-wide to eliminate wait lines, crowding, and social distancing during the COVID-19 pandemic and the River North location will launch with online orders only through Sunnyside.shop. Once customers receive a text notification that their order is ready, they can check-in at the Guest Experience Center at 22 W. Hubbard to be entered into the virtual pickup queue.

Meanwhile, Cannasafe has announced the opening of three new ISO-accredited laboratories in Oregon, Florida, and Illinois to help meet the increased demand for cannabis during the pandemic. Canna Provisions has opened a new storefront in Easthampton, MA with another in nearby Holyoke slated to open shortly. Another Lee, MA location shut down due to the pandemic will also be reopening. Canna Provisions is using a quick transaction model involving ID checks, a wireless ATM card reader, and frequent sanitizing to facilitate safe customer interface while offering additional support via Zoom links and instructional videos to help customers understand the new system. 

These considered moves by some of the industry’s best-known names have all of the makings of successful ventures, especially given the attention to the potential infection hazards inherent in storefront retail. Still, as demand for cannabis continues strong and companies build capacity to meet that demand, it remains to be seen whether Covid-19 and a potential “second wave” will frame a gamble on the future of in-person sales as one worth taking or not.


Debra BorchardtDebra BorchardtMay 6, 2020
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3min7010

New March 2020 point-of-sale data from cannabis analytics firm BDSA shows a divergence between states where cannabis sales are improving during the COVID-19 lockdown versus states whose business has declined. According to the data, California sales have experienced another month of double-digit growth, following a troublesome period of weakness. Nevada’s dependence on the tourist trade has hurt the states’ businesses in a big way.

California

California sales jumped 11% year over year in March and 12% sequentially over February. That’s the second month in a row that California’s had double-digit growth. The state already had an established home delivery business, so when the lockdown took hold, a delivery model was already in place. Curbside service was added and in some cases, drive-through windows were available.

The state had been hurting for sales during the vape crisis as this was a popular purchase. For instance, 25% of sales in the state come fro vapes, while other states it is closer to 17%.   Year-over-years vape sales were down 8%, while flower sales were up 33% over last year and now command 37% of the market. The data said that non-beverage edibles and pre-rolls gained share in March as well.

Other Winners

In addition to California, newcomer Illinois saw its March sales increase 11% over February. That state has continued to allow in-person sales and began to allow curbside service. It’s only the third month for adult-use cannabis sales. Flower sales accounted for 36% of the market and vape sales were 33% of the market. Sales in Maryland increased 22% in March over February and 83% over March 2019.

Colorado sales rose 18% in March versus February and 15% over March 2019. Colorado dispensaries remained open and the state began issuing home delivery licenses. Arizona continues to crush it with a year over year sales growth of 42% and a sequential increase of 21%. Home delivery had already been established in the state, so the lockdown was an easy accommodation. Oregon reported that sales increased 31% year over year and 22% sequentially in March. Oregon also kept the dispensaries open and had an established home delivery model.

Losers

Nevada seemed like a no-brainer place to locate a business prior to the pandemic. Hordes of tourists from illegal states happy to spend big bucks for marijuana. The loss of the tourists caused sales to decline 6% year over year and a 4% drop from February.

In Massachusetts, adult-use dispensaries were initially allowed to remain open, but then just as abruptly closed. This caused sales to fall by 3% in March versus February. There is no word on when they will be allowed to reopen.

 


StaffStaffMarch 25, 2020
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7min12280

Cannabis dispensaries have been super busy as sales skyrocketed ahead of lengthy lockdowns. With anxiety levels rising, many consumers turned to cannabis to ease their tensions and help make the time stuck inside go by a little easier. For some companies, they have taken extra steps in order to assist in the fight against the virus.

Canopy Growth/Hexo

BNN Bloomberg reported that Canopy Growth (NYSE: CGC) spokesperson Jordan Sinclair said that the company donated “thousands” of gloves, Tyvek suits, and masks sourced from two massive greenhouses in British Columbia that it shut down earlier this month. “We committed our personal protective equipment from our recently shuttered B.C. sites to the front-line medical staff at a local health unit in Victoria,” Sinclair said in an email to BNN Bloomberg. Hexo said it donated 150 N95 facemasks to paramedic services in the Outaouais region in Quebec to “help fill their critical need”, according to a company spokesperson.

CannaCraft

The edible cannabis company CannaCraft said it has converted a portion of their manufacturing space and production capacity to formulate and package individual bottles of hand sanitizer that will be donated to individuals and organizations throughout California.

The company trialed the program last week, creating hundreds of tubes that were distributed to employees and customers. After the successful test run and registering with the FDA, the company procured enough materials to make 40 gallons (or 5,000 1oz. tubes) of hand sanitizer. The hand sanitizer will be donated to non-profits, customers, employees, and essential businesses and will be distributed later this week by Kind House Distribution, the company’s wholly-owned distribution arm.

“We are doing everything we can to protect our employees and our communities by adhering to guidelines and directives from officials and experts. At the same time, we are uniquely positioned to help in other ways because we have manufacturing equipment, scientific expertise, and a statewide distribution network built into our business,” said Jim Hourigan, CannaCraft CEO. “When we started hearing reports of a shortage in hand sanitizer, we knew that we could be of assistance without negatively impacting our employees or our operations.”

The hand sanitizer was formulated by CannaCraft’s head of R&D, Matthew Elmes, Ph.D., and is being packaged and distributed by a limited production team, due to the company’s decision to restrict facility access to essential production and distribution staff only. The teams have been split into smaller groups and are spread throughout CannaCraft’s 70,000 ft2 headquarters to reduce unnecessary interactions. Additionally, CannaCraft has implemented robust health and safety protocols throughout every step of the supply chain process.

Glass House

Glass House Group is donating 1,000 protective gowns to Cottage Hospital, a Santa Barbara hospital, so their healthcare workers can use the disposable protective equipment during the COVID-19 health crisis. The company is also working with its suppliers to find extra masks for frontline healthcare workers, donating 5% of their local product sales from its Santa Barbara dispensary to the food bank to help kids get free nutritious meals while schools are closed and offering all of their workers two weeks of paid leave.

Marrone Bio Innovations

Plant health company Marrone Bio Innovations, Inc.  (NASDAQ: MBII) announced that its Jet-Oxide® 15% post-harvest sanitizer and industrial disinfectant product is now allowed by the U.S. EPA for use against human coronaviruses to sanitize industrial food and agricultural hard surfaces.  The allowed use was based on a study conducted by the EPA with Human Coronavirus Strain 229E (one of the viruses associated with human colds)  on the effectiveness of spreading of diseases on hard surfaces.

The study, conducted at a sanctioned EPA laboratory, met all requirements for 40CFR 160 – yielding a 99.99% reduction of Human Coronavirus Strain 229E. The study was conducted using a dosage of approximately 1300 ppm (0.130%) of the active ingredient with a contact time of 60 seconds at an ambient temperature of 22 degrees Celsius.

Crazy Calm

CBD coffee brand Crazy Calm said that for every online order from now until the end of March, all profits will be donated to Direct Relief. The company said it chose Direct Relief (DirectRelief.org) because it has a long-standing track record, have already helped tremendously and will continue to do so:

“In the U.S., Direct Relief is delivering protective masks – along with exam gloves and isolation gowns – to health care organizations in areas with confirmed COVID-19 cases.”

“In China, Direct Relief has delivered via FedEx more than 30,000 pounds of protective gear — nearly 800,000 N95 and surgical masks, more than 400,000 gloves, and numerous coveralls, face shields, and shoe covers — to frontline health workers.”


Debra BorchardtDebra BorchardtMarch 20, 2020
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4min11400

It seems most businesses are reporting dismal outlooks during the pandemic. Event organizers, airlines, bars, restaurants, theatres – you name it everyone is suffering. Everyone except cannabis.

Business intelligence from Akerna (Nasdaq: KERN) said that cannabis sales are thriving during the COVID-19 pandemic. The company provided the following statistics:

The numbers March 11 – March 18:

  • Medical cannabis sales: Up 20.8%
  • Recreational cannabis sales: Up 11.6%
  • Flower sales: Up 22.6%
  • Vape sales: Up 9.7%
  • Edible sales: Up 12.4%

“Cannabis operators are running an essential business,” said Ostap Rapeyko, business intelligence analyst, Akerna. “On March 11, when major news of the potential impact of COVID-19 indicated changes in lifestyle, buying patterns were at normal rates. However, a week later, on March 18, sales increased by 19.2% overall.”

Columbia Care Sets Weekly Record

Columbia Care Inc. (OTCQX: CCHWF) reported preliminary revenue for the week ending March 14th, as well as preliminary year-to-date revenue for January 1 – March 14, 2020.

Preliminary Results (vs. same prior-year period)

  • Revenue for the week ended March 14, 2020 increased 156% to a weekly record $2.8 million
  • Year-to-date revenue through March 14, 2020 increased 131% to $23.6 million
  • Results include only a partial benefit of the Company’s six dispensaries opened during the first quarter of FY 2020

The results were repeated across the board with the following State Level Operational Highlights (week ended March 14, 2020):

  • MA: record weekly revenue
  • OH: record weekly revenue, including single day revenue record in Dayton
  • CA: record weekly revenue, including single day revenue record in De Soto
  • DE: record weekly revenue, including single day revenue records in Rehoboth and Wilmington
  • PA: single day revenue records in Allentown and Wilkes-Barre
  • IL: record weekly revenue, including single day revenue record in Chicago
  • FL: record weekly revenue
  • MD: record weekly revenue
  • PR: record weekly revenue

In a sign of support for the company, members of the Columbia Care management team and board of directors will be able to purchase shares in the open market, beginning March 19, 2020.

HardCar Keeps Delivering

Cannabis delivery and security business HARDCAR will continue to distribute cannabis while other distributors scramble with the shut down of California.  That’s because ‘Essential Services Sector’ companies may continue to operate while others MUST shut down. HARDCAR has been ESS certified for nearly 4 years. Emergency Services Sector companies may continue operations legally in the state of California when other companies must shut down operations.

“We saw this one 3  years ago when the first quakes were hitting in California so we made sure all vehicles were ready for events like this. We installed air purifiers as trials and had fantastic results. Then we added satellite phones and generators to some rigs so we are very prepared.” Todd Kleperis of HardCar.
Sal Moccia CEO of HardCar said, “Right now it’s not about profit – it’s about sustainability and moving through very treacherous roads. Who better than the US military veterans we have to make our way in a time of crisis. I’m proud of our team for never wavering and never faltering to make this industry secure.”

Gretchen GaileyGretchen GaileyMarch 16, 2020
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4min8950

With news coverage of the Coronavirus pandemic prepping Americans for the impending health crisis, many are taking extreme precautions with whom they interact, where they are going, and the businesses that they frequent. According to The Washington Post, “consumer spending – which supports 70 percent of the economy – is grinding to a halt,” and cannabis businesses are not immune.

The only way to shore up your business and maintain your customer base is through public relations and communication, internally and externally. A lack of information breeds fears and anxiety.  You have the power to alleviate those concerns and navigate this health crisis.

Communicate with your Customers: No one in this country has dealt with this kind of crisis in recent years, so there are questions all around on how to deal with it. Tell your customers about the extra precautions that you are taking in your dispensary to maintain a hygienic environment. CEO Wanda James of Simply Pure did a great job of this recently in an online video posted to Instagram, where she informed her customers of the precautions that they have always taken and are currently taking to ensure customer safety.

Make company announcements across multiple platforms: This will show your customers, employees, and stakeholders that you have a firm grasp of the situation and that you are covering all of your bases. By having one standard message across all platforms it also leaves no room for miscommunication.

Communicate with your suppliers: Around the country, quarantines may go into place, impacting your supply chain. Or perhaps you are a vape pen manufacturer waiting on parts to come in from China. You need to be aware of what strains and products may not be coming into your store so you can inform your patients and your budtenders. With this knowledge in hand, you can determine alternative product recommendations for your patients and have your workers prepared to offer that advice.

Have in Place Emergency Preparedness Plan: Make sure all employees are aware of contingency plans when they may call in sick, have childcare issues when their children are kept home from school, or you run out of product. You don’t want your business to be impacted because your employees don’t know how to react to internal conflicts.

Educate the media: In this 24-hour news cycle, reporters are going to need to fill every angle possible in their broadcasts to inform the public about what is going on in their communities and they will eventually look at what is going on in the cannabis industry. You want your organization to be known for the care, calm, and professionalism that the cannabis industry is bringing to this health crisis. If reporters have medical questions about what impact cannabis might have on the virus, bring in a doctor that you trust to speak on your behalf. Since COVID-19 is a respiratory illness, speak to reporters about products you may be advising patients to take that are not consumed through the lungs. Don’t wing it and don’t make unfounded claims about your product being able to cure it.

Above all, take care of yourselves and your loved ones. Our industry is still in its infancy, now is not the time for martyrs. We need everyone healthy and an “abundance of caution” is not cowardice, it’s the best science available.

 


Debra BorchardtDebra BorchardtMarch 16, 2020
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4min10150

Facing calls to stay inside and avoid large groups, cannabis consumers decided the way to best pass the time was to stock up on supplies. Dispensaries have been reporting large lines as shoppers increase purchases. Boston dispensaries were seen with lines snaking out the doors, while other states reported fewer shoppers, but larger purchases.

The Covid 19 virus has resulted in the cancellation of numerous cannabis conferences and even delayed some grand opening plans for new dispensaries. So far it seems April 20 celebrations haven’t been canceled yet and some of the bigger conferences planned for late May are still on schedule.

iAnthus (OTCQX:ITHUF) kept its soft opening of its first Northeast Be. retail store on Staten Island in New York last week. This is the company’s third store in New York. Beth Stavola, iAnthus Chief Strategy Officer noted that the soft opening was successful.

Ayr Expands Sick Leave

Multi-state operator, Ayr Strategies Inc. (CSE: AYR.A)(OTCQX: AYRSF) said it has joined with the United Food and Commercial Workers International Union in announcing measures to safeguard the health of its employees and customers. Under the measures, Ayr employees will benefit from an expanded sick leave policy that allows for additional paid time off and sick leave for those dealing with the impacts of the COVID-19 virus.

“Our highest priority is the well-being and safety of our employees, our customers and the community,” said Jon Sandelman, CEO of Ayr Strategies. “We’re expanding our sick leave policy to ensure that employees’ concern about COVID-19 does not keep them from protecting their health or the safety of those around them.”

“We’re committed to working with employers like Ayr Strategies to ensure the health and welfare of our members and their communities. We are pleased to see Ayr take a proactive step forward in protecting its employees,” said Fernando Lemus, Secretary-Treasurer and Acting President at UFCW.

CBD Does Not Prevent Covid 19

The FDA is cracking down on businesses claiming to prevent the spread of Covid 19. The agency sent out numerous warning letters to vitamin companies and essential oil sellers saying, “The FDA is taking urgent measures to protect consumers from certain products that, without approval or authorization by FDA, claim to mitigate, prevent, treat, diagnose, or cure COVID-19 in people. As described below, you sell products that are intended to mitigate, prevent, treat, diagnose or cure COVID-19 in people. We request that you take immediate action to cease the sale of such unapproved and unauthorized products for the mitigation, prevention, treatment, diagnosis, or cure of COVID-19.”

So far no letters have gone to CBD companies, but there have been reports that some CBD companies are trying to make the connection as these supplement companies have.

 

 



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