Our processing and extraction facility has the capability to produce high quality CBD and THC extracts, as well as a wide variety of additional products to become available following the anticipated second round of cannabis legalization coming this October 2019.
CIM: How does diversification (e.g. cultivation, retail, processing and extraction) benefit Canadabis Capital, shareholders and investors?
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CC: I touched briefly on our vertically-integrated structure previously, but the benefits don’t just relate to the relationship between our cultivation and retail pillars. Stigma Grow produces high quality cannabis that can be sold as dried flower or used in our processing and extraction facility to create a wide array of new and exciting products. These products will then be sold at our retail location as well as others throughout Canada. CanadaBis’ direct ownership of each of these assets not only ensures control over the quality of its products and experiences, but it also provides the Company with flexibility to adapt to changing consumer demand and changes in market conditions. For example, as consumers begin to gravitate towards a different type of cannabis-infused product, we have the ability to pivot our product offerings and control every input and output related to those products. Similarly, reduced margins for the Company’s product at the cultivation level may be offset by increased margins at the retail level. Ultimately our diversification gives us the ability to maximize our cash-flows, but it also serves as a risk-management tool.
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CIM: Does so many lines of business take your focus away from your core business? Are there synergies?
CC: Our core business is industry leadership, and having a diverse portfolio of brands, all connected in one way or another, makes us stronger as a whole and more able to control, or at least influence, our company’s path forward.
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