- SGMD
expanding BudCars Cannabis Delivery Service into LA area
- Sugarmade
forecasts BudCars business to top $30 million in annualized revenues in
Sacramento alone
- Company
sees potential for up to 20 new BudCars hubs across California over next
two years
Sugarmade Inc. (OTCQB: SGMD), a product and branding
marketing company investing in operations and technologies with disruptive
potential and an early pioneer within California’s regulated cannabis industry,
announced that its recently acquired BudCars Cannabis Delivery Service is
expanding into the Southern California marketplace (http://ibn.fm/o7WiJ). Initially
launched in the Sacramento area, the cannabis home-delivery service has seen
unprecedented growth in its first months of operation.
“Our Sacramento locations will pass the $10 million mark for
annualized sales within the next 60 to 90 days,” Sugarmade CEO Jimmy Chan
stated in a news release. “The growth has been so dramatic that we have had to
drastically revise our expectations to the upside, which demands expansion,
both in terms of staff and fleet in Sacramento, and in terms of regional
expansion into Southern California. As a result, we are acquiring two
distribution hub locations in the LA area with cannabis licenses included so we
can hit the ground running.”
In the expansion announcement, the company reported that
BudCars’ primary Sacramento locations have seen tremendous growth, with
revenues consistently increasing 10% week over week. While the growth has been
attributed to exploding demand for contactless delivery of cannabis products
due to the COVID-19 pandemic, company officials expect the upward spike to
continue, even after social-distancing restrictions are loosened. SGMD
forecasts its BudCars business to top $30 million in annualized revenues this
year in Sacramento alone.
In addition, based on data gathered from its current
operations as well as trends in the LA region, the Sugarmade team is confident
that each of the two new LA BudCars hubs will provide an annual revenue
run-rate of $15 to 20 million – as a moderate baseline estimate. Sugarmade
officials pointed to its Sacramento locations, which are reporting a consistent
19–20% net profit on sales, noting that the same margins are expected in the
Southern California market.
The two LA locations are just the beginning of the CarBuds
expansion. Officials see further expansion potential for up to as many as 20
new BudCars hubs across California over the coming two years, funded primarily
by cash from operations.
“We are hiring and expanding our fleet as fast as we can
right now to keep up with demand,” said Chan. “We can’t expand fast enough. But
that’s a great problem to have, and LA represents an ideal new market for
BudCars.”
As one of the few cannabis companies pursuing a vertically
integrated business model, SGMD is placing its current focus on the expansion
of non-storefront cannabis delivery. In addition to BudCars, the Sugarmade
brand portfolio includes CarryOutsupplies.com, SugarRush(TM) and Budcars.com.
Sugarmade has benefitted from a remarkable growth spurt thus far in 2020 and will
seek to maintain its recent trajectory going forward.
For more information, visit the company’s website at www.Sugarmade.com
NOTE TO INVESTORS: The latest news and updates
relating to SGMD are available in the company’s newsroom at http://ibn.fm/SUGAR
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