Expansion Strategy - Letter to Sharholders
“As a final note, to demonstrate my personal commitment and conviction, I have contractually and permanently waived my right to convert my own 2.5 million preferred share stake in Sugarmade into common shares, so they can never be brought into the common share market as supply.”
Sugarmade Issues Shareholder Letter on BudCars Growth and Expansion Strategy
4/22/20, 5:30 AM
NEW YORK, April 22, 2020 (GLOBE NEWSWIRE) -- via NetworkWire – Sugarmade, Inc. (OTCQB:SGMD) (“Sugarmade”, “SGMD”, or the “Company”), and its BudCars Cannabis Delivery Service (“BudCars”), issues the following Letter to Shareholders from the CEO:
Dear Valued Shareholder,
On behalf of the entire team, allow me to start out by expressing our gratitude for your patience and commitment as we navigate what increasingly appears to be an extremely promising road stretching out ahead of Sugarmade. My goal today is to discuss that road ahead and to provide shareholders with a deeper sense of perspective as we expand our BudCars segment to capitalize on this extremely powerful growth opportunity.
BudCars is quickly becoming a powerful presence in the California cannabis delivery marketplace. Our primary hub in Sacramento has experienced extremely rapid growth in terms of total orders, sales, daily volume, staff, and fleet. And this growth has been dynamic, robust, and sustained over the past two months. We believe this trend will continue to define our 2020 operational outcome distribution, granting us strong conviction in our aggressive revenue targets, as outlined in Sugarmade’s recent corporate communications.
Our expectation is that we will surpass the $10 million annualized revenue target before August (possibly well before), putting BudCars on a pace to reach and surpass $30 million in annualized revenues by year end. Especially, with the support of the expansion of two new locations.
As we recently announced, we are now expanding into the Greater Los Angeles regional marketplace, which represents perhaps the biggest and most lucrative cannabis delivery market in the world. We are initially set to open two new BudCars distribution hubs in this area. Given our research into this regional marketplace opportunity and our experience thus far with the BudCars business model in Sacramento, we anticipate an annualized revenue run-rate of $15-20 million at a minimum at each of the new LA locations.
We also plan to continue to expand BudCars across the California marketplace. Underlying demand for this service seems bottomless, and we believe we have only just started to scratch the surface of the potential for growth in this segment. But we are also very conscious of our responsibility to all of our stakeholders to maintain a fiscally viable path forward each step of the way.
As a final note, to demonstrate my personal commitment and conviction, I have contractually and permanently waived my right to convert my own 2.5 million preferred share stake in Sugarmade into common shares, so they can never be brought into the common share market as supply.
Once again, I cannot overstate how excited I am about this Company, our exceptional base of loyal shareholders, and the promising path we have in front of us. I look forward to updating you again as we accomplish new milestones.
Warm Regards,
Jimmy Chan, CEO
About Sugarmade, Inc.
AI
