Exclusive Interview with Fire & Flower CEO Trevor Fencott
Cannabis retailer Fire & Flower (TSX: FAF) (OTCQX: FFLWF) continues to strengthen its retail network across Canada, and in 2021, it is exploring what expansion into the U.S. could look like. CEO Trevor Fencott last spoke with New Cannabis Ventures in May 2020 and checked in at the beginning of 2021 to discuss how the company’s digital platform is driving growth, the recent acquisition of Friendly Stranger and his outlook on the rest of the year. The audio of the entire conversation is available at the end of this written summary.
The Friendly Stranger Acquisition
At the end of last year, Fire & Flower completed the acquisition of Friendly Stranger. The acquisition gives the company access to a different consumer base, an accessories brand with a long history and a stronger retail position in Ontario. Fire & Flower now has 25 stores in the province. With a cap of 30 stores, Fire & Flower is close to reaching the curent maximum allowable retail footprint in Ontario, according to Fencott.
Fire & Flower is opening stores at a brisk pace; it currently has 74 retail locations, according to Fencott. The company’s largest presence is in Alberta, and it also has a significant footprint in Saskatchewan. Following the Friendly Stranger acquisition, Fire & Flower has a big presence in Ontario as well. The company has one store in Manitoba and plans to add more. In British Columbia, the company has completed store build-outs and is waiting on licensing.
In the early days of the cannabis industry, there was a rush to build and open stores. As time passed, it became clear that retail requires a disciplined approach. Brick and mortar expansion slowed, a trend further driven by the early months of the COVID-19 pandemic. Now, construction has begun to pick up again, but Fire & Flower is taking a more precise approach, according to Fencott.
The company will consider M&A opportunities that are immediately accretive going forward according to Fencott, but he believes organic growth is more cost-effective from a capital allocation perspective.
The Hifyre Platform
Fire & Flower’s investment in technology has helped it to navigate the pandemic, facilitating delivery and curbside pickup. The company’s Hifyre digital platform also drives customer acquisition and communication. More than 190,000 consumers use the platform, according to Fencott, and that number continues to grow.
Creating an omnichannel connection with consumers was always the company’s intent as it developed a retail 2.0 strategy. And the Fire & Flower team is seeing the value of that approach. The company’s digitally engaged consumers driver further revenue with a bigger basket size, according to Fencott.
The Hifyre platform gives Fire & Flower access to powerful analytics. By examining consumer behavior, the company was able to identify a market opportunity. Over the summer, it launched product private label brand Revity CBD. Fencott expects the CBD product category to continue to grow in markets like the U.S.
Cannabis 2.0 Products
In Canada, the rollout of cannabis 2.0 products has progressed in fits and starts, affected by supply constraints and regulations. Fencott offered the example of beverages. This product category is crowded with many different brands, but purchase limits remain, and penetration in this category is relatively low thus far. He expects that some of the barriers for 2.0 products will begin to lower over time.
Couche-Tard Partnership Update
Fire & Flower continues to find new ways to leverage the strategic partnership it has with Alimentation Couche-Tard. Recently, the company announced a pilot project focused on opening cannabis retail locations near Circle K stores. The pilot program is a reflection of the company’s focus on consumer convenience. Fire & Flower plans to have smaller store locations conveniently located and stocked with the products consumers want, as determined by the company’s analytics. Fencott expects that the pilot program will progress to other phases this year.
The company is also looking at other ways to work with Couche-Tard. For example, it is currently involved in a pilot program for gift cards, and it is exploring merchandising opportunities between the two companies.
Additionally, Fire & Flower has a shared services agreement that allows it to make use of Couche-Tard’s depth of real estate experience. Couche-Tard has 16,000 stores, which means it has an advanced store selection process, according to Fencott.
Looking to the U.S.
Fire & Flower was built from the ground up to be a best-in-breed, tech-enabled cannabis retailer. Canada was always meant to be the testing grounds for the company, according to Fencott. The partnership with Couche-Tard, which has thousands of stores in 25 countries, means Fire & Flower ultimately wants to be in each of those countries where cannabis is legal.
As it considers opportunities in the U.S., the Fire & Flower team wants to find markets that are similar to Saskatchewan: a market where the company can do distribution, delivery, ecommerce and bricks and mortar retail. As a retailer, the company is less interested in states that require vertical integration. A state like California, according to Fencott, would make be appealing.
In December, Fire & Flower exercised warrants, receiving more funding through the partnership with Couche-Tard. The company also announced an at-the-market equity program at the end of 2020. The ATM was about a low cost of capital for the company, according to Fencott. The company has a strong balance sheet, and he wants to make it even stronger. Cash in the bank is important, particularly during the ongoing pandemic.
The company achieved its goal of positive operating EBITDA last quarter, and positive cash flow opens the door to more funding options, according to Fencott. Going forward, he expects the company to focus more on non-dilutive financing like debt raises.
Growth in 2021
Now that the company has reached the point of positive operating EBITDA, it wants to continue that momentum and demonstrate sustainable positive EBITDA to its shareholders. This year, the company plans to continue opening stores in Canada and pursuing aggressive financial growth. While Canada is a relatively small market, Fire & Flower has honed its approach to hub and spoke distribution and its technology infrastructure, which could give it a competitive advantage as it breaks into other markets, according to Fencott.
As the company grows, the Fire & Flower team will be closely watching the weighted average cost of capital. Capital efficiency is particularly important now, according to Fencott. The company also tracks traditional retail metrics like revenue per square foot, same-store growth and year-over-year sales growth.
While the company is bullish on its growth prospects, Fencott is still cognizant of competition from the illegal market. Regulatory issues and the illegal market are two closely related challenges. He is also excited about the opportunity to enter the U.S. market. He anticipates that Fire & Flower’s efficient business model and digital infrastructure will give it a competitive advantage.
While the Democratic sweep in the U.S. has sparked even more interest in the cannabis industry, Fencott still believes the retail sector is undervalued by investors. He expects retailers are the group most likely to be profitable the fastest in this business.
New Cannabis Ventures provides an Investor Dashboard for Fire & Flower, which is a client of New Cannabis Ventures. Listen to the entire interview:
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William O’Shaughnessy & The Start of Cannabis Medicine
The idea of medicinal marijuana has blossomed out in the last several years, opening up new markets, changing regulatory restrictions and legal mandates, and showing that popular opinion can easily change over time. How it started in the first place is not a story known to all. In fact, most people have no idea that […]
The post William O’Shaughnessy & The Start of Cannabis Medicine appeared first on CBD Testers.
The idea of medicinal marijuana has blossomed out in the last several years, opening up new markets, changing regulatory restrictions and legal mandates, and showing that popular opinion can easily change over time. How it started in the first place is not a story known to all. In fact, most people have no idea that it was an Irishman named William O’Shaughnessy who brought cannabis medicine to the Western world.
The world of legal cannabis is ever-changing, with new innovations and products coming out all the time. One of the more exciting additions to the world of marijuana is the inclusion of delta-8 THC. This newest THC compound gives users less psychoactive effects and less anxiety, while still offering a host of medical and recreational benefits. It just so happens we have some great Delta-8 THC deals, for you to go ahead and give it a shot! Judge for yourself if this is a superior form of THC.
Cannabis in history
Before getting into recent history, let’s go back to ancient times. The history of cannabis use as a medicine goes back thousands of years with tons of natural medicine traditions using the plant all over the world for different purposes. In Ayurveda it was used to increase appetite and digestion; to decrease diarrhea, as well as other gastrointestinal issues; as an anti-spasmodic and anti-convulsant; for nervous system issues; skin infections; as an aphrodisiac, or to calm sexual feelings (in later stages of the application); issues with genital and urinary tract function; respiratory issues; infectious diseases; and a host of other problems. If you look at what’s being covered here, it includes ailments of nearly every kind that were being treated by cannabis.
In Traditional Chinese Medicine, cannabis seeds were used as laxatives – although they were simultaneously used to help stop diarrhea, to alleviate thirst, and relieve flux. If it seems weird that cannabis was employed for opposing issues (constipation and diarrhea), this could be explained by a normalization effect on a person’s liver. Repeated vomiting was also treated with cannabis seeds, and regular use of these seeds was said to “render the flesh firm, and prevent old age.”
The Chinese also supposedly used cannabis as an antidiabetic by boiling the seeds in water to make a paste. Cannabis was used for skin ailments, ulcers, wounds, hair loss, and diseases of the lymph nodes which included degenerative, incurable, and intractable illnesses. These are just some examples of how Traditional Chinese Medicine used cannabis. Though many texts have not been made available to the English-speaking world, it is known that cannabis was used in medical applications for at least 1,800 years, and possibly as long as 4,000 years.
CBD and libido: can CBD improve your sex life?
Thanks to its long list of wellbeing-boosting benefits, CBD is one of the most popular supplements on the market today. But can CBD help you have better sex? It certainly looks that way! In a large survey by Remedy Review, 68% of people said that taking CBD improved their sexual experiences. Scientific research into CBD […]
Thanks to its long list of wellbeing-boosting benefits, CBD is one of the most popular supplements on the market today. But can CBD help you have better sex?
It certainly looks that way! In a large survey by Remedy Review, 68% of people said that taking CBD improved their sexual experiences. Scientific research into CBD and sex is still in its early days, but the research we do have seems to agree.
In this article, we’ll explore several ways that CBD can improve your sex life, from getting you in the mood to solving your sexual issues. We’ll also take a look at the science behind these claims, starting with a quick explainer of how CBD works…
How does CBD work?
In the 1990s, scientists discovered that we have a large, complex system called the endocannabinoid system (ECS). It keeps the body in a state of balance, regulating everything from sleep, temperature, pain, appetite, and reproduction.
The ECS is controlled by a network of chemical messengers called endocannabinoids – that is, cannabinoids that are produced endogenously, or internally. They travel around the body, acting on receptors that tell the ECS to take action.
CBD, or cannabidiol, is one of many chemicals in the hemp plant. It’s extracted from the oil of the plant and used to make CBD consumables, like oils, capsules and creams. CBD is also a cannabinoid, and just like your own endocannabinoids, it can act on ECS receptors in your body.
Researchers have found large concentrations of ECS receptors in the reproductive organs. We’re not sure exactly how CBD interacts with those receptors yet, we just know that it does!
In the meantime, there’s lots of anecdotal evidence – and some scientific support — for the benefits of CBD. In this next section, we’ll explain some of those benefits and what the research says so far.
CBD and libido
Your libido, or your sex drive, is your desire to have sex. Some people just have a naturally higher sex drive than others, but if you find that yours is lower than normal, CBD may be able to help get you back in the saddle, so to speak!
Anecdotally, lots of CBD fans claim that it gets them in the mood. The scientific evidence is a little thin; we know that cannabis activates the part of your brain that controls sexual arousal, but we don’t know if this is specifically because of CBD, or because of other chemicals like THC. Therefore, we can’t say for sure whether you’d get the same benefits from taking CBD alone.
One way CBD definitely can help your libido, though, is by relieving stress and anxiety. Sex can trigger lots of different worries around everything from body hang-ups to performance pressure to traumatic experiences. Your sex drive can also be affected by anxiety conditions like Generalised Anxiety Disorder (GAD), or by worries outside of the bedroom, like work, illness, or money troubles.
Study after study after study shows that CBD can reduce anxiety. The US National Institute on Drug Abuse agrees, stating that CBD reduces the signs of anxiety and stress. This is most likely because it calms the central nervous system, specifically the parts responsible for emotional regulation.
CBD and pleasure
Not only could CBD get you in the mood for sex, it can potentially make it more enjoyable, too. CBD improves blood flow and nerve sensation, with some experts claiming that this makes for more pleasurable sex and better orgasms. The Remedy Review survey seems to back this up, with the majority of those who took CBD for sex reporting that their orgasms were more intense.
CBD is also proven to boost levels of a neurotransmitter called anandamide. Also called the “bliss molecule”, it works closely with a hormone called oxytocin to make sex feel rewarding and pleasurable. Oxytocin is also responsible for feelings of satisfaction and romantic attachment.
CBD as a lubricant
Some women experience dryness that can make sex uncomfortable or even painful. A lubricant can make sex easier and more enjoyable, and now many brands are adding CBD, too.
Of course, lube works just fine on its own, so why add CBD? The theory is that because it stimulates blood flow and improves sensation, it can also encourage the body to produce more of its own natural lubrication. It’s also a natural anti-inflammatory, which might alleviate any discomfort.
CBD and erectile dysfunction
Erectile dysfunction is the medical term for difficulty either getting or maintaining an erection. The occasional failure to launch is usually nothing to worry about, but if it’s happening all the time and it’s interfering with your sex life, then CBD may be able to help.
The cannabis plant, from which CBD oils and other products are made, has been used in Ayurvedic medicine for thousands of years to improve sexual performance and function. We’re not exactly sure how CBD helps, but we do know that it reduces blood pressure, improves circulation, and promotes blood flow to the genitals – all essential for getting and keeping an erection.
CBD and pain
For some people, sex is often associated with pain. That can come from sexual problems like vaginismus, where the muscles of the vagina involuntarily contract to prevent penetration, or dyspareunia, where a woman experiences pain during or after sex. It can also be related to painful gynaecological conditions, like endometriosis or polycystic ovarian syndrome (PCOS), or even general health problems. The pain often leads to anxiety around sex, which can make any difficulties even worse.
We already know that CBD relieves anxiety, which can help people feel more physically and mentally relaxed when it comes to sex. Relaxation is especially helpful for conditions like vaginismus and dyspareunia, as it can help resist the urge to tense up. There’s not much research into the topic, but anecdotally, lots of women report that taking CBD oil or capsules, or using CBD topically in a lubricant, helps to ease their symptoms.
If you suffer from any condition that causes you pain, sexual or otherwise, it can have a significant impact on your sex drive and your enjoyment of sex. Thanks to CBD’s anti-inflammatory effects, lots of people report that it helps them to manage chronic pain. And unlike some of CBD’s sexual benefits, we have lots of research on pain to support the anecdotal evidence.
How to use CBD for sex
There are lots of ways to use CBD for sex. To improve libido, relieve anxiety, or promote a feeling of relaxation, go for CBD oils, capsules or edibles, like CBD gummies. For dryness or pain, choose a topical CBD lubricant. And if you want to set the mood or incorporate CBD into the main event itself, try one of the many CBD massage oils on the market.
Remember that it takes a little time for CBD to take effect. Vaping is the quickest as it goes into the bloodstream directly from the lungs. Oils and tinctures are not far behind; they’re absorbed via the blood vessels under your tongue and take around 30 minutes to kick in. Capsules and edibles have to go through your digestive system, and topicals have to be absorbed through your skin, so all of these methods take a little longer.
All that to say: you’ll get best results if you use your CBD of choice at least 30 minutes before you hit the bedroom. Obviously it’s not always possible (or particularly sexy) to plan ahead for sex, and it’s not exactly practical to lube up an hour in advance! So you might want to think about, for example, taking a few drops of CBD oil an hour before and then using a CBD lubricant in the moment. If you do mix products, though, be careful to pay attention to your overall dose.
How much CBD should I take?
Whether you choose capsules, creams or oils, the dosage per serving will be listed clearly on the packaging. If you’ve never used CBD before, around 10-20mg is a good starting dose. Wait at least a few hours to see how it affects you, and if you feel comfortable, then stick with that dose or increase it slightly.
Keep working your way up slowly like this until you achieve the desired effects. If you start to feel any uncomfortable side effects, drop back down to the last comfortable dose and stick with it.
Is CBD safe for sex?
Yes, for most people. We’re not aware of any serious side effects from CBD, although it can interfere with some medications. If you’re taking medication and/or you have an existing health condition, it’s best to check with your doctor first.
Topical CBD products like creams and massage oils often contain other ingredients, like moisturisers or plant extracts. These can cause skin reactions for some people, so if you have sensitive skin or if you suffer from allergies, check the label carefully.
Lubricants are usually designed with intimate skin in mind, but again, check the label to make sure there are no irritants, allergens, or unnecessary ingredients. Generally, the fewer ingredients you’re putting down there, the better!
A word of caution: because CBD is still being studied, experts aren’t entirely sure how it affects fertility. Anecdotally, it seems to be safe, but we just don’t have the scientific evidence yet to say for sure. If you’re trying for a baby, or you’re considering it in the near future, it’s wise to speak to your doctor before using CBD.
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