With approximately 3,600 lb / 1,630 kg of Beyond Tobacco™ base material currently being transported to its contract manufacturer, the Company is pleased to announce that its first distribution-ready shipment of approximately 9,000 finished ten-pack cartons of Taat will be shipped to Ohio-based tobacco wholesalers’ warehouses for November 27, 2020. Wholesalers will be able to use this inventory to fill orders of Taat placed by tobacco retailer accounts in the convenience channel as part of Taat’s launch. Following receipt of a 18,491 lb / 8,387 kg shipment of material, the Company will have a total on-hand supply that can produce more than 60,000 cartons of Taat which are intended for sale at retail.
LAS VEGAS and VANCOUVER, British Columbia, Oct. 16, 2020 (GLOBE NEWSWIRE) -- TAAT LIFESTYLE & WELLNESS LTD. (CSE: TAAT) (OTCQB: TOBAF) (FRANKFURT: 2TP2) (the “Company” or “Taat”) is pleased to announce that an initial inventory of approximately 9,000 ten-pack cartons of Taat is to arrive at wholesalers’ warehouses in Ohio by the end of November. This inventory can be used by wholesalers to fulfill purchase orders from tobacco retailers in the convenience channel as part of Taat’s launch. Further, the Company provides an update regarding its current supply of biomass for the Beyond Tobacco™ base material, as well as the present status of Beyond Tobacco™ undergoing refinement for the Company’s manufacturing partner to produce Taat. Following an initial purchase order of Taat by an Ohio-based tobacco distributor (announced in the Company’s October 6, 2020 press release), Taat has sought to solidify its supply chain and inventory of materials in order to prepare for anticipated demand and reorder patterns after launching the product.
The Company has developed Beyond Tobacco™, which is the nicotine-free and tobacco-free base material of Taat, its flagship product. Taat is to be offered in Original, Smooth, and Menthol varieties, to provide current tobacco smokers of legal age an option to retain the experience of smoking while leaving nicotine behind. Taat has been meticulously engineered to closely replicate the sensory and motor elements of smoking a tobacco cigarette, including a tobacco-like taste and smell created by a patent-pending refinement process for the Beyond Tobacco™ base material. Taat has received an initial purchase order from a Canton-based tobacco wholesaler who has direct and indirect relationships that collectively provide access to more than 5,000 tobacco points of sale in the convenience channel across the state.
Before the end of October 2020, approximately 3,600 lb / 1,630 kg of finished Beyond Tobacco™ base material is to be transported from Taat’s Las Vegas, NV processing facility to its contract manufacturer (the “Manufacturer”), who also produces cigarettes for global and regional tobacco brands. It is anticipated that this shipment of Beyond Tobacco™ base material will allow for approximately 9,000 ten-pack cartons of Taat to be produced. After the material arrives at the Manufacturer’s facility for production, the Taat product will be manufactured and packaged in its newly designed packs. The finished cartons will then be arranged and wrapped on pallets to be stored in the Manufacturer’s warehouse facility, awaiting dispatch instructions for outbound shipment as directed by Taat. Based on current supply chain timelines, the Company anticipates that the initial retail inventory of Taat is to arrive at Ohio wholesalers’ warehouses by the end of November 2020, which will allow the wholesalers to fulfill orders from accounts in the convenience channel.
As of this writing the Company has 6,563 lb / 2,977 kg of unprocessed biomass in its Las Vegas, NV processing facility, with an additional 18,491 lb / 8,387 kg to arrive by Monday October 19, 2020. The aggregate total of this supply is sufficient to produce approximately 626,000 20-stick packs of Taat. Taat’s current processing bandwidth for the Beyond Tobacco™ base material is approximately 1,200 lb / 544 kg per day. The Company’s management believes that with its Beyond Tobacco™ base material production capacity and the Manufacturer’s production rate of up to 2,000 sticks per minute, Taat is favourably positioned to meet forecasted demand during its launch phase in Ohio. As initial batches of unprocessed biomass and finished Beyond Tobacco™ base material are “turned over”, the Company will seek to optimize all relevant workflows to increase efficiency and prepare to potentially scale its manufacturing pipeline upward in the near term.
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Taat Founder Joe Deighan commented, “In my previous businesses it was always very clear that the ability to run an efficient and reliable supply chain is a major factor that can affect your ability to operate profitably. Whether that may consist of ensuring that your distributors always have the inventory they need, or keeping an eye on the little expenses that can add up and affect your margins, knowing and mastering your supply chain is nearly as important as the actual product itself. In the past few months, we have built a rock-solid infrastructure for procuring biomass, processing it to make Beyond Tobacco™, transporting it to the Manufacturer, producing and packaging Taat, and shipping it to our distributors who would then bring it to stores to put on their shelves. Now that we are within six weeks of our initial Taat inventory arriving in Ohio, the time has come to make sure we have everything we need to make our supply chain a well-oiled machine, which includes several tons of biomass to produce Beyond Tobacco™. We estimate we can make more than 600,000 packs of Taat based on the supply of raw material we will have as of Monday. Accordingly, I believe it is safe to say that we are no longer in a ‘test’ phase, as we begin to produce a large quantity of inventory to distribute in our launch market.”
Taat Chief Executive Officer Setti Coscarella commented, “Because our objective is to align Taat with incumbent products in the tobacco category, a key component of our launch strategy is cutting no corners when it comes to inventory levels. As a product that is meant to be purchased on a regular basis by current smokers of legal age, unavailability of Taat at any given point of sale can negatively impact our brand’s perception and prevent repeat purchases. Tobacco distributors in any market create their value by ensuring orders from stores in their network get filled, but that means it’s on us to provide a consistent supply of our product to those distributors. Today is my 77th day as Taat’s CEO, and I believe I have wasted no time at all in planning and establishing a supply chain that enables us to produce Beyond Tobacco™ and Taat in a timely, cost-effective, and scalable manner. We now have a reasonable supply of material which can be moved along our supply chain to produce finished inventory, allowing us to maintain a sufficient pipeline of product in line with anticipated reorder patterns. It is very fulfilling for us to be this close to bringing Taat to the retail market so that current smokers of legal age in Ohio can have access to our product, and be empowered by the choice we can give them to be able to keep the experience of smoking, while leaving nicotine behind.”
On behalf of the Board of Directors of the Company,
TAAT LIFESTYLE & WELLNESS LTD.
“Setti Coscarella”
Setti Coscarella, CEO
For further information, please contact:
Taat Investor Relations
1-833-TAAT-USA (1-833-822-8872)
investor@taatusa.com
THE CANADIAN SECURITIES EXCHANGE (CSE) HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS RELEASE.
About Taat Lifestyle & Wellness Ltd.
Having developed Beyond Tobacco™, which contains no tobacco or nicotine, Taat’s objective is to introduce an innovative, experience-driven alternative to tobacco cigarettes for tobacco smokers who aspire to leave nicotine behind. Beyond Tobacco™, which is to be offered in “Original” and “Menthol” varieties, is designed to closely emulate every aspect of smoking a traditional cigarette. From the cigarette-style packaging and stick format, to the proprietary flavouring blend which imparts the flavour and scent of tobacco, to the draw sensation, and the amount of smoke exhaled, Beyond Tobacco™ has been meticulously engineered to enable smokers to continue enjoying the experience of smoking, while discontinuing nicotine intake. Taat plans to launch Beyond Tobacco™ in mid-Q4 2020 and is seeking to position itself in the USD $814 billion (2018)1 global tobacco industry to capitalize on the growing worldwide demand for alternatives to traditional cigarettes.
For more information, please visit http://taatusa.com.
References
1 British American Tobacco - The Global Market
Forward Looking Statements
This news release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Often, but not always, forward-looking information and information can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur, or be achieved. Forward-looking information in this news release includes statements regarding the potential launch of Beyond Tobacco™, in addition to the following: Potential outcomes resulting from shipments of Beyond Tobacco™ base material, its respective biomass, and finished Taat product. Potential arrival of finished Taat inventory at warehouses of wholesalers in Ohio as described in the release. Potential performance of the Company’s supply chain following the retail launch of Taat. The forward-looking information reflects management’s current expectations based on information currently available and are subject to a number of risks and uncertainties that may cause outcomes to differ materially from those discussed in the forward-looking information. Although the Company believes that the assumptions and factors used in preparing the forward-looking information are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed timeframes or at all. Factors that could cause actual results or events to differ materially from current expectations include: (i) adverse market conditions; (ii) changes to the growth and size of the tobacco markets; and (iii) other factors beyond the control of the Company. The Company operates in a rapidly evolving environment. New risk factors emerge from time to time, and it is impossible for the Company’s management to predict all risk factors, nor can the Company assess the impact of all factors on Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in any forward-looking information. The forward-looking information included in this news release are made as of the date of this news release and the Company expressly disclaims any intention or obligation to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required by applicable law.
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