Tinley Beverage Co (CSE: TNY) released its much awaited corporate update this morning, providing the market with news on the current status of its operations across the largest cannabis market in the world. With an encompassing review of operations, investors are able to now get a sense of where the issuer stands in the Californian market.
Most notably from the release, is the news of Tinley Beverage now having its product in retailers across the state. While the firms Twitter profile had slowly begun to release information on where to obtain its products, shareholders now have a better understanding of that scale. The release indicates that key retailers across the state now sell its product, in addition to beverages being available for home delivery in several populous regions, including Silicon Valley and the San Francisco Bay Area.
Previously indicated backorders in excess of $200,000 have also now been filled, thanks to the operational capacity of the phase two production line. Product began shipping in June to these retailers. Interestingly, demand appears to have increased at cannabis lounges that are freshly popping up within the state. While non-existent in Canada, the Californian market has recently seen the development of cannabis lounges for the consumption of product, similar to that of a bar. However, with certain smoke restrictions in place, one of the best methods of consumption is that of beverages, akin to a traditional lounge. Tinley has seen an increase in demand from these facilities, and expects demand to increase as more lounges open for business across the state.
Operationally, progress has also been made on Tinley’s efforts towards co-packing. The firm released this morning that it had two prospective clients at this point in time, for which it has formulation products already. Substantial interest has been shown from potential clients, whom are currently in the alcohol and cannabis industries. A timeline was not given on the expected close date of signing such clients, however it is believed to be relatively soon.
Tinley Beverage also released a status update on its Long Beach production facility, also known as phase three of its growth stage. The facility itself is nearing substantial completion, with commissioning expected to occur over the next couple of weeks. Licensing by the state of California for manufacturing remains in process, and should not be impacted by the final completion of the buildout. The big news related to the facility, which is expected to provide both manufacturing and distribution services upon completion, is that Tinley has advanced its distribution model based on the experience of company president, Rick Gillis.
Known as Direct Store Delivery or DSD for short, the method of distribution tends to be unique for beverage firms. The process often includes not only delivery of the product, but merchandising services as well with in store displays, retailer education programs, and frequent restocking of store shelves. Tinley has since launched these services to the Californian market for the cannabis beverages sector, and has acquired two vehicles for its distribution fleet.
Lastly, and perhaps most importantly to our Canadian viewers, is that Tinley is currently in talks with two Canadian licensed producers for the manufacturing of its products in the Great White North. Current wording in the press release suggest both are currently working under letters of intent, with definitive agreements to be put in place in the near term. Tinley Beverage expects to begin discussions with provincial distributors this fall to enact distribution agreements within Canada.
FULL DISCLOSURE: Tinley Beverage is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Tinley Beverage on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
