RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Potential Flower SalesHawkII wrote: SUM - Vaping deaths and the corresponding drop in sales for US participants (even if for a short term) is absolutely relevant to Canadian sales, margins and resulting legislation. Vape devices have higher margins and so when vape sales get hit (even if people switch to other form factors), then margins also take a hit. The US peers that were suggested as comps by Munch have vape products in the mix ... SPR has no intention of vapes as far as I know and so their margins will be inferior. In addition, if they were to consider it, I wish them luck because vape headlines aren;t going away anytime soon as evidenced by this article:
https://globalnews.ca/news/6194275/vaping-regulations-canada-provinces/ wrt TrueAeroGrow - it may be good for craft/small batches, but aeroponics is not scalable, which means if they go that route they will be a bit player. This is not what MH is after IMO.
It will be very hard to create a brand with good margins in the current Cdn regulatory environment IMO. Maybe it's time to remind readers of the Nov 22nd post highlighting this
... "as I understand it, beer brands are a non-starter on labels, lots of colours won't be approved, warnings need to be much bigger/plentiful, Fusion/Agent 47/ Hitman wording needs to be much smaller (in other words warnings must outsize brand wording as in existing flower packaing), beverage multi-packs aren't allowed unless they total 10mg (ie - 4x2.5, 2x5 or 1x10)."
To note, SPR does not have rights to US market. Therefore will not be in direct competition within US jurisdictions. Any company competing in Canadian market will be required to abide by the same regs. This will creatie a level playing field, which would then put more emphasis on details other than branding, such as quality for example, to set them apart or create an edge.
IMO, established Canadian comapanies will be at an advantage here in Canada and perhaps gain more praise for quality assurance when Canadian companies head into a Federally legal US market. No offence to US residents, but I have more faith in HC then the FDA, but that’s another story all together. The US and Canadian cannabis markets are two very different organisms. One legal one not. I hate to tell you but the world does not revolve around the US , in all aspect at least. Not all issues in the US will have the same impact else where. Who knows, HC regulated and quality assured Canadian made vapes may be the catalyst to propel these market margins the other way. I disagree with your opening statement, when vapes hit the shelves in Canada, we will have a better understanding. Till then, your merely speculating based on US NR for your agenda.
My point, any US companies used in the margins calaculation by Munch was part of a guesstimate. Fill in the blanks for unavailable Canadian market figures and unknown SPR figures. It was a decent attempt with the lack necessary of data.
As for the growth method of TAG. It is scalable and well fitted to suit the THC style of growing and not solely for small batch. The method of growth at THC is executed on a (smaller than average) room by room format. Quite intelligent method. This allows assurance of avoiding major cross contamination, easily regulated environment and allows for quick quarantine if necessary. Indoor/TAG is a safer and indeed scalable method at the THC facility.
You can calculate the margins or attempt to discredit more favourable SPR margins from Munch all you like. However, you are wasting your time as your facts are equally speculative.