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Benefits of a SoCal Microbusiness with Delivery, Manufacturing & Distribution

by Jason Piazza on February 5, 2024
Benefits of a SoCal Microbusiness with Delivery, Manufacturing & Distribution

Read about the benefits of this SoCal Microbusiness – Delivery, Manufacturing, Distribution listing.

We look at a lot of businesses that want to sell and our first priority to ascertain is: “Is this a well-situated license that can be a benefit to a buyer?”. On this particular opportunity the answer is a resounding “YES!” Here’s why:

1. For starters, it’s operational: It goes without saying, but becoming operational in the cannabis industry is a difficult task which drives M&A value.

2. A microbusiness license is a fantastic license type: This allows workflow to be maximized through efficiency in the real estate layout and taxes, both of which have a profound effect on an operation’s bottom line. Instead of managing three licenses, an operator only must deal with one license umbrella that allows them to operate under three license-types.

3. The mix of licenses here is a winner as well: The opportunity has delivery (B2C), distribution (B2B), and manufacturing licenses. This is ideal for cultivators or manufacturers that are looking to increase their bottom line through vertical integration. With the B2C delivery component, a producer can dramatically increase their profitability by skipping over wholesale distribution, and save money on distribution by delivering your own product to your own packaging and delivery hub.

4. This business has no outstanding debt or tax liabilities: Business has barely operated since obtaining its licenses. The owners are more focused on their Central California cannabis operations, and their business plans have shifted away from SoCal. The buyer of this microbusiness will take over a clean, ready to flourish business.

5. While there isn’t any manufacturing equipment, there are three compliant vehicles: It features one refrigerated van for distribution, and two compliant Priuses. The business is ready to deliver product where it needs to go.

6. Simple additions in the warehouse will allow a buyer to create a workflow that fits their business model: While it is an operational business, the manufacturing portion of the business isn’t really operating aside from pre-roll assembly in a small area, and the distribution storage is relatively small. However, the seller installed a refrigerated room for ice-water extraction, and cages can easily be added to increase distribution storage in the warehouse.

7. A strong lease: The unit is approximately 5,800 SF with monthly rent at $9,500 including operating expenses. That’s about $1.50/SF NNN (triple net), which is not an expensive industrial lease in Southern California.

8. IP BONUS: The seller spent considerable time and money creating a cannabis delivery app which is currently on the Apple Store and Google. While it’s hard to quantify the value here, the right owner with the right marketing strategy can certainly make this a valuable value-add.

Our client is looking to offload this asset quickly so they can focus their energy on their revised business plans in Central California.

Interested? Give me a call to discuss further! 949-682-5867

Looking forward to hearing from you,

Jason Piazza
Director of Real Estate
WeCann | CREC


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