Blum Holdings Inc (BLMH)

[IndustryParticipant]

"Economy of scale". There's absolutely no reason expenses should increase proportionately with revenue and sales. 95% of expenses will remain fixed.

If I have an operation (rent, licensing, payroll, etc) the increases should be minimal if I go from $1MM to $10MM.

(Accounting and legal may increase, an extra employee here and there, supplies of course, extra packaging (cultivation), etc, but it will not be a dollar for dollar, 10 fold increase in expenses.

That's just stupidity, pure and simple.

We just had an operation do a 500% increase in sales. Additional expenses were a couple full time, couple part timers, that's about it. (Instead of overstaffing, the entire staff now merely stays busy (swamped) the entire shift, which they prefer. Other operations have double or triple the staff/payroll for same volume. We typically staff about 1/2 or less of similar operations. (I'd rather have fewer employee's making more, staying busy (and happy) than overstaffing, everyone making less, etc....)

An interesting TRTC note (from what I have seen), compensation (average employee) is a little high, and their marketing expenses are probably unusually high, as their efforts appear to be fairly inefficient.

I'd agree though, their entire operation has changed (literally overnight), so while yes, financials are always important, in this specific case, yesterday's data is truly no longer relevant/outdated. Q3 and moving forward will actually be a more accurate representation of operations.