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FROM ERIC IN RESPONSE TO DOOGDILINGER'S QUESTION I FORWARDED

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Serenity   Wednesday, 10/14/09 03:57:58 PM
Re: doogdilinger post# 106296
Post # of 219294 
FROM ERIC IN RESPONSE TO DOOGDILINGER'S QUESTION I FORWARDED

Question was:

"Can you ask Eric for numbers on the avg number of weekly orders from ALL the established retailers now!!!

Eric advised me last april that this fall he had hoped to be in a much more favorable position to provide avg weekly numbers. So although his mass expansion endeavors continue...it'd sure be great to get some clarity on the current weekly order book numbers...like are we now safe to assume that an avg week brings in $20K in orders which works out to $1M per year...or are the avg current weekly numbers MUCH higher???

It's time for Eric to let the patient longs know if WNBD is now on a bare minimum confirmed +$1M in per annum revs...& if we are...announce it weeeeeeeeeeeeeeeeeeeeeeeeeee"


REPLY

Eric Lehner to me

show details 3:38 PM (18 minutes ago)


Hello Mrs. XXXXXX,

I think there is a minor misunderstanding as to the intent of the comment made about weekly numbers. It would not have been my intention to suggest that any company should post weekly sales figures. It is likely that Doogdilinger is remembering more than one thing from his visit, lasting more than 2 hours, that merged in his recollection. What I said was is that by the end of the year increasing momentum may result in more regular or predictable orders from distributors in which trends can be compared, even weekly, for management purposes.

On the subject of sales, at the risk of continuing to be the renegade CEO who insists on introducing reality into discussions rather than hype, I should emphasize that even the new stores being signed-up with increasing frequency will take time to deliver their impact on sales. This is because the actual pace of daily living for the consumer is slower than our entrepreneurial imagination and aspirations as shareholders (including my own of course). This does not mean that it is not significant that the store counts are increasing, but rather that these additional stores will deliver their cumulative benefit to us gradually. Take this practical example: a new store decides to carry the product. They will then order in an initial quantity, say a case of 12 bottles or (increasingly) a display rack. Days, become weeks, before it “sinks in” at the store level amongst staff of what this product is. It then takes time for an initial group of customers to form – ie people who try it and then eventually provide feedback to the store. Then it takes time for word within the store to spread that “...this stuff must be good because John Smith told me about how it helped him, and come to think of it, he is not the only one...”, etc. Now this sounds pretty drab, I know. But that is one aspect of reality. It coexists with all the excitement which is legitimate and true as well. A mature understanding requires the combination of both. This combined reality (ie the vision as well as the actual behaviour of people) has an important upside – momentum. When the combination of sufficient time and a critical mass of consumer satisfaction hits its stride as momentum, then the same slowness that was so frustrating in the early days becomes a substantial force to be reckoned with, working for our benefit, because it is not easily stopped. Just think of a freight train and you will know what I mean.

We are still early enough in the process that all this pushing and slogging is painful. There has been a great deal of effort for relatively slow movement until recently but this is starting to give way to the force of momentum that will then help us and greatly reduce the effort and waiting for future sales. For this reason, a fixation on how close we are to the million dollar mark at this exact moment, misses the point that we are building momentum to take us far beyond that – perhaps to a $100 Million operation or more. The past 36 months have been about preparation, trial, error, improvement and identifying the right relationships. The first real positive effect of real momentum is just starting to show up now and will materially affect numbers beyond 2009.

I fully understand that this sober assessment is about as welcome as a sermon at a backyard BBQ, but it is my job to ensure that all those who are associated with the firm are respected with a no-nonsense reminder of the basic forces at work. In my opinion, this leaves our current shareholders with greater likelihood of achieving substantial capital gain through growing regard by potential investors watching for the company’s ability to focus on the mission, keep it real, and getting the job done in practical terms. We all wish we had a dollar for every pie-in-the-sky story that has been presented in the junior public markets. Because of my practical approach to these matters I have both the confidence to regard attainment of our goal as highly probable, and have earned the credibility that this opinion matters. How few companies can really speak with credibility about their goals?

Bottom line: It is basically irrelevant to our current market capitalization of approximately $15 Million whether our sales are $500K, $1 Million, or even several million. The primary factor determining our share price is the likelihood of us reaching the big prize - $100 Million (and more). More people are watching WNBD than ever – and the evidence they are seeing is that we are building responsibly, with staying power. That’s our corporate style. We are systematic, focused and hardworking. Shareholders who join us now are getting shares at a low valuation relative to our potential. People who would rather wait until we have already achieved our goal will not have access to the same capital gain potential. This is because a few more tipping points, especially in the U.S., will make the $15 Million market capitalization far too low.



Rgds,

Eric Lehner, CEO

WinningBrands.ca

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