SEATTLE, Nov. 09, 2018 (GLOBE NEWSWIRE) -- via NEWMEDIAWIRE -- CFN Media Group (“CFN Media”), the leading agency and financial media network dedicated to the North American cannabis industry, announces publication of an article covering Next Green Wave Holdings Inc. (CSE: NGW). California’s cannabis industry is projected to grow from $3.7 billion this year to $5.1 billion in 2019, according to Arcview Market Research and BDS Analytics, making it the world’s largest adult-use recreational market. In fact, the industry may surpass $5 billion per year beer market next year as it cannibalizes sales and reaches new consumers. There are many companies targeting the space, but only a handful could become market leaders.
Next Green Wave Holdings Inc. (CSE: NGW) is one of only a few companies building a vertically-integrated cannabis business—from seed-to-consumer. By taking this approach, the company aims to dramatically lower its costs, increase quality standards, and ultimately generate greater revenue growth and profit than its competitors. The company also holds conditional use permits (CUPs) for nursery, cultivation, extraction, and distribution, which form the foundation of its vertically-integrated business model. Investors may want to take a closer look at the stock given this unique business model.
Vertically Integrated Cannabis
Vertical integration is a business strategy whereby a company controls every stage of a single production path. For example, a vertically-integrated cannabis company may consolidate multiple steps in the cannabis production process, including both manufacturing and distribution.
The internal cost-savings and greater efficiency of this approach leads to several key benefits, including lower transaction costs, strict quality control, supply reliability, and increased market control. Since vertical integration requires a large capital outlay, the strategy also helps create a barrier to entry for competitors. Vertically-integrated companies often have greater pricing power and better quality control than non-vertically-integrated competitors.
Different states have different laws regarding vertical integration. California permits some licensees to hold both producer and processor licenses, but doesn’t permit manufacturers to own retail operations—a model similar to the alcohol industry’s distribution.
Next Green Wave’s Approach
Next Green Wave is building state-of-the-art facilities for cultivation, nursery/breeding, extraction, and distribution to produce and transport premium cannabis products to consumers.
The company’s assets include over 15 acres of cannabis-zoned land and two facilities where it will create hybrid strains and plans on becoming a supplier of clones, seeds, and seedlings to wholesale clients. In its flowering facility, the company will cultivate globally-recognized and award-winning genetics into premium flower. It will then process this flower to produce oils, waxes, tinctures, and other cannabis products, as well as provide extraction for others.
In addition to manufacturing, the company will develop a network of licensed retail stores to distribute its branded and white-label products throughout the state. The company will also contract with other high-quality brands to provide distribution.
The seed-to-consumer business model will empower innovative nursery practices, while enabling strict quality control and stable supply. By entering both premium and white-label markets, the company aims to control every price point on dispensary shelves—ranging from mid-to high-end branded products spanning every major category.
Looking Ahead
Next Green Wave Holdings Inc. (CSE: NGW) is uniquely positioned to capitalize on California’s cannabis industry given its unique seed-to-consumer business model. In addition the company has recently acquired a leading cannabis genetics company—Loud Seeds—which has won the High Times Cannabis Cup six times since 2012, making it one of the best known cannabis brands in the world.
Investors may want to take a closer look at the stock as it moves closer toward completing its facilities and moving into production.
For more information, visit the company’s website or download their investor presentation.
Please follow the link to read the full article article: http://www.cannabisfn.com/next-green-waves-unique-business-model-yields-greater-potential/
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