RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:What NextBitofgreen wrote: Perhaps Aphria will focus on selling oils to companies like Whole Foods to do the manufacturing. I suspect this is what the extractions center is all about. It might make more sense to sell ingredients to companies Mars, and Diageo rather than compete with finished products. This would accelerate revenue streams.
INVSTIGAT0R wrote: Just to throw some numbers out there:
Let's say Aphria decides to build a chocolate bar production line of 1 million bars per year and sells them for about $20 per 20mg bar.
Let's forget for a second that Aphria would need to invest a ton of time/money to get a facility up and running and licenced, let alone formulate a chocolate bar that people are going to want to eat. If they contract out to a confectionary company to produce the chocolate/candy then Aphria won't be getting all of the $20 per bar, but let's still use that number just for fun.
1 million bars @ $20 per bar = $5 million per quarter. Pretty much nothing.
Aphria is going to need to sell a wide variety of different edibles and beverages and sell millions of each and every one of those products per year in order for them to make meaningful, market cap sustaining numbers.
Now if you think that Aphria is going to somehow sell 10,000,000 different chocolate/candies/beverages at $20 per unit wholesale guess what? You're only looking at an extra 50 million per quarter in revenue. Pretty concerning if you ask me, since you know, Aphria is definitely not going to be pumping out 10 million units of infused products at $20 a pop any time soon.
I agree that's likely what is going to happen but that means we say goodbye to the kinds of margins that infused products will be generating. It's pretty crazy that they're selling a single chocolate bar with THC in it for about $20. Getting wholesale prices for oil with margins that are going to shrink year by year isn't as attractive. Aphria will definitely have a leg up and be one of the largest first mover in the oils market though so at least there's that.