Blum Holdings Inc (BLMH)

[IndustryParticipant]

Everything in life is oceans of gray....

Touche, point taken I may have regionally generalized, and every cog in the machine is different. I'm in Colorado, where cannabis life has normalized in many ways. I have rentals in So. California and vibe is WAY different. I I do fall into logical fallacies. I hate getting caught, LOL!

Time will tell, this conversation will be interesting over the years.

Question, any value in "IVXX", any opinion on branding vs white label for TRTC operational areas specifically?

Many assume California is a market "completely wide open" when as many have seen, there are many jurisdictions opting out, as well as commenting on production, yet the state has never known open retail for it's 250MM annual visitors.

Similarly, while Nevada is not quite the CO market (population plus annual visitors), it definitely surpasses in the sense of portion of annual visitors with larger disposable income and visits specifically for vice. On can note Nevada month 2+/- hit what it took Colorado 12 months to hit, and they did it with a fraction of the locations. (I believe CO hit 35MM+/- in sales month 12 of adult use with 300 locations)

Many, specifically as of late speak of Oregon, which it was known years ago it was an inferior market, but yet the previous applies, while some are struggling, others are not, which is similar to what has been in the past in California....ie: Some cultivation wholesaling for absolute top dollar, all production spoken for before ready, while others desperately mark it down to whatever necessary to move. Always has been, always will be the case in any market.

The layman sometimes does not understand this aspect of the industry. AAA quality is extremely rare and not the norm. Never has been, never will be (the norm).

I go through probably 30-40 ops per year, more and more many of those are among the largest and most well funded groups in the nation currently.

Common denominator? The larger and more well funded and "sophisticated" they are the worse their products. (believe it or not.)

I think the primary reason seems to be they fail to grasp they have entered a realm of "artist(s)/artistry" and nuance. I can't even count how many times I have had conversations with such groups explaining why higher compensation is necessary to secure top end talent and skill sets and was told "ehh, it's a weed, anyone can grow it".....as the 30MM "state of the art" facility puts out seedy, wet product of undesirable/inferior genetics as well..

As just touched on yesterday, NJ is also appearing to be a superior market (for the operator) in the sense of a market approaching CA as well as 3 times larger than CO, yet in a footprint 1/10th of the size, and discussing a total of 400 cultivation and dispensary licenses, similarly can be said for NV, as well as the CA locals opting out.

IVXX, value, white labeling.

One of the things I have seen, again, more with the "larger, sophisticated, and well funded" groups is "licensing" for products and brands, and I personally frown upon such.....(bear with me, going somewhere)

I/we sat with a group who had entered a "licensing" agreement for an edible line. My response?

Give me $50k, a graphic designer, point me to the nearest culinary school, and in 30 days we'll have you an entire edible line. The same can be said for anything for the most part. (Their deal was for 25%....so 50k a sneeze)

Any brand can be extremely valuable, (or worthless) depending on quality first, and exposure 2nd. A brand could be created tomorrow to compete with any and all currently existing in the market (nationwide).

More and more my position of late is I could create a brand with no label, and if the quality was there, people would seek "the stuff with no label"..

As such.....as far as production/operations, it would only be a matter of what is the facilities production, and what do the numbers look like (white label)...

If I (speaking first person) can product x volume out of x facility and our brand (IVXX) is doing well and constantly back ordered, why would I want to do white label and feed a potential competitor/competing brand? when I yield more in a vertically integrated model?

White label more an approach when your running obscene sizes (100k-200k plus) and no brand per se or vertical integration....(or many different approaches which I won't go into here as it's $1k an hour billable ;)

Going back to the above, they could also do as mentioned above.....pump out the product, maintain quality and grow presence and exposure, and "license" to other states as well.....

More and more due to such , I've actually been contemplating more focus on that approach.....ie: sit and create and pump out brands and then make licensing deals nationwide LOLOLOLOL......(with people unwise enough to want such unfavorable deals....)

I call em "sucker" deals due to above.....(simply create them at will with very little work and effort)....

Industry has also been seeing "licensing" deals for genetics as well, which is even worse......ie: we'll set you up with our proven genetics and advise cultivation process for 25%......Yes, people are doing these as well.......

I see a lot of IVXX nonsense (critique's) and it's quite easy to produce a line and have it in every dispo in the state....I would assume their lack of progress on such has merely been through lacking the cultivation(s), which they are now achieving, which is yet another aspect....(why did they do dispo and not focus more on cultivation, or both equally balanced, etc....which could be bounced back and forth indefinitely...the important thing being they are now, which will greatly affect all numbers moving forward......

Most likely reason? This is where they started, these are where the opportunities were, and they went with such.....

CA various deals, now structures that can be built of quicker and cheaper, NV #1 at probably 6-7 weeks veg, NV #2 now essentially just funded by dispo sale, and so on.....

I maintain the same......at this point, all they have to do is "come to work and do their job" and all should unfold quite well....

Far too many things in pipeline in CA (applications in limbo, structures ready to be built out), same in NV, and NJ looking like a goldmine given the above (smaller license count for immense market).