When the recreational marijuana industry was launched in California, the trend was for every company to be vertically integrated. This meant that everything was handled in-house from cultivation and manufacturing to packing, retail sales and distribution. As the industry has matured, the shortcomings of vertical integration have become all too apparent, and companies are divesting themselves of many divisions and operations in order to focus on their key competencies. NorCal Cannabis is one example of a marijuana company that has taken the route of shedding excess weight from its operations. In the beginning, NorCal went the vertical integration route, operating everything from cultivation facilities to retail locations and even a huge home-delivery operation. However, the company noticed that it was bleeding money on each delivery run its vehicles made, so the logical thing for NorCal to do was to divest itself of marijuana delivery, so the company let its delivery license expire. NorCal CEO Jigar Patel says that things have been looking up ever since the executive team made the hard decision to concentrate on cultivation as well as building the company brand.
CannabisNewsWire, 05/12/2022 16:20:00