Post by
Oldweed on Sep 30, 2023 1:50pm
The Way Ahead
For myself the struggle is deciding who has the best strategy. With movement starting to happen in the US, it is likely we will see more of a CPG model emerging. If that is the case, then the vertical integration will have to more of a classic farming model supplying companies. The vertical structure works while we are in a restricted medical market, but is not the best practice for retail scale in the US. Tilray has kept its vertical integration intact I'm guessing to remain certified for medical markets. What will e interesting to see is once retail in the US opens up, scale will be the driving force that will need to be addressed. Currently there is a massive oversupply, so vertical systems will struggle to be competitive. I think Canopy has already taken the CPG asset light (production) and got out of the retail. A big question is will Tilray be able to attract CPG partners at their current cost structure? Will the MSOs move away from growing as well? Is Canopy/STZ on the right track. In my opinion each company will have to pick their lane, retail, production, farming, and CPG branding. You can't do it all at enough scale to be competitive at a global scale. For the near term, having craft beer and such to subsidize revenue through this period is a different strategy, gow will this pan out long term? Will opportunity be los in the MJ sector by not being focused? This is why I am hesitant to say Tilray is the only one and MSOs are bad, there is still allot to happen before the clear winners emerge.
Comment by
Oldweed on Sep 30, 2023 8:59pm
I can assure you I am not leading anyone towards MSOs or LPs. There are several MSOs and only 1 Tlry so yes Tlry gets mentioned a dash. CGC is essentialy an MSO now. On that point, it would be absurd to suggest only Tlry is doing it right. My pick of choice is Hiti, and none of the above mentioned until I can see a path to profitabity, next Q Tlry might impress, as you said, time will tell.