Those consumers are very value-conscious, he said. “And we do intend, and we are selling, higher-end cannabis products – just at a lower price point than the competition.”ĭescribing Value Buds’ target customer, Karasiuk cited market research showing that roughly 70% of Canadian cannabis by volume is consumed by 20% of the marijuana-consuming adult population. It’s that gap between price paid and the benefit received,” Karasiuk said. He said the updated Value Buds branding serves an important promotional purpose, particularly since Canadian cannabis advertising is restricted. The original concept was called “Deep Discount Cannabis,” and Karasiuk said the store conversions resulted in average sales increases of 250% within two months. Some stores have already been converted: Alcanna started experimenting with the concept of a discount marijuana retail brand at four Alberta locations last year, said Karasiuk, a former executive at Canadian producers MedReleaf and Aurora and current Alcanna board member. ![]() Alcanna will be Nova’s majority shareholder, backing it with a CA$10 million line of credit.Īn upsized private placement that closed this week raised CA$40 million for the new company.Īlberta-based Nova will become Canada’s third-largest private-sector marijuana retailer by number of corporate-owned stores, owning all but one of its 53 initial locations.įire & Flower currently owns 76 stores after purchasing Friendly Stranger, and High Tide has 64 corporate-owned stores and six franchises after acquiring Meta Growth.Įighty percent of Nova’s stores, or roughly 40 locations, will be converted to Value Buds. The resulting retailer will be called Nova Cannabis, the name of most of Alcanna’s current cannabis stores. ![]() Under the deal, Alberta-based Alcanna – a major Canadian alcohol retailer – will spin off its 34 marijuana stores and combine them with competing retailer YSS by way of a reverse takeover that values the new company at 130 million Canadian dollars (roughly $103 million). The business combination is part of a wave of mergers and acquisitions among Canadian cannabis retailers. ![]() “Every element has to line up for this model to work,” Karasiuk said.
0 Comments
Leave a Reply. |