After over a year on the recreational cannabis market, Zenabis seems to have finally found its cannabis sales niche. In recent weeks, the company has been offering a brand new product on the shelves, Re-Up. This product features mid-range cannabis that joins its two other established brands already on the shelves, Namaste and Blazery. As of October, the company had produced 12,770 kg of cannabis.
New Brunswick cannabis company, Zenabis, rolled out its newest product called Re-Up. It is inexpensive, and at $5.53 per gram, it is the lowest regular price currently offered on the Cannabis New Brunswick website.
This product is the company’s response to the black market. They believe their low prices are holding back the legal market from really taking off.
It is estimated that the average price of a gram of cannabis on the black market is just over $5. The company’s objective is simple: to convince consumers who buy on the illicit market to do so legally instead.
Good quality products on the New Brunswick cannabis market
“We knew that there was a place in the market for this less expensive, but still quality, kind of product. We are thinking in particular of more regular consumers, who want a more affordable product because of the quantity consumed,” said company spokesperson Jordan Owens. “We have the production capacity and inventory, so we decided to test the market. The response has been excellent, beyond our expectations.”
If she had to make a comparison, Mrs. Owens would make a comparison between champagne and beer.
“Not everyone opens a bottle of champagne every night after work, but it’s more likely to open a beer or two,” she said. All in all, Re-Up is less high-end cannabis, but it delivers the goods perfectly.
How Zenabis cut prices on cannabis products
How do you manage to cut the cost of sales? According to Owens, largely through mass production, but also through better use of packaging.
It argues that Re-Up is proof that it is possible for cannabis producers to compete with the black market.
Last October, since the arrival of the Re-Up brand, Zenabis has gained 34% of the sales of cannabis products sold at Cannabis NB, up from previous months.
Additionally, Re-Up is no stranger to this increase in market share, although other elements such as the addition of capsules and vaporizers to the company’s product portfolio also played a role.
“It’s still early, but we feel that Re-Up is a product that we want to continue to develop and that we want to put a lot of emphasis on elsewhere in the country because at the moment it’s only available in New Brunswick and Saskatchewan,” added Owens.
An eventful year for New Brunswick cannabis companies
The past year has also been a year of many accomplishments for Zenabis.
Firstly, the company completed all phases of expansion at its Atholville plant. It is now fully functional, which has allowed the company to do well in terms of production, regularly exceeding its objectives.
As of October, the company had produced 12,770 kg of cannabis, 8% more than originally forecasted. This figure, largely attributable to the Atholville plant, is expected to increase significantly as all growth producers will be available online.
The year 2019 also marks the IPO of Zenabis, a slightly less successful move. Though the stock was almost at $5, it quickly dropped. After holding between $1 and $2, the stock has dropped drastically and is currently trading around $0.20.
However, according to Owens, Zenabis is not the only cannabis company to have to deal with such a situation. Virtually the entire Canadian cannabis industry has experienced a significant devaluation in market value.
Also in 2020, the Atholville plant could obtain accreditation for the sale of cannabis for medicinal purposes overseas, including from European Union member countries.
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