Cannabis Brands Brace For Post-Pandemic World, COVID-Induced Challenges Ahead
The COVID-19 pandemic continues to raise its ugly head, with Covid-19 cases passing 18 million in the US. To date, over 300,000 deaths have been attributed to COVID-19 in the United States.
A vaccine is currently sold by Pfizer Inc. (NYSE: PFE) and its German partner BioNTech SE - ADR (NASDAQ: BNTX). Moderna Inc. (NASDAQ: MRNA) vaccine has also been approved. Both are even tested against a contagious variant.
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The hope is that a vaccine could bring about a touch of normalcy in the coming months. However, medical professionals tell Benzinga that while planning a post-Covid normal is a wise move, a vaccine is not a panacea and that many pandemic guidelines are likely to remain in place.
Related link: How Covid-19 is affecting the cannabis industry
Think about whether you want to plan the eventuality
Dr. Joseph Allen is a member of the Lancet COVID-19 Commission and Director of the Healthy Buildings Program at Harvard.
Allan, Associate Professor of Exposure Assessment Science at T.H. The Chan School of Public Health tells Benzinga that companies should keep thinking through 2021.
"While winter is likely to be bad, companies should be working on a plan for spring and summer now," says Dr. Allan. There is no single solution and there is no risk of exposure.
The goal, he explains, is to minimize risk by "using a layered defense approach, employing what is known in public health as the hierarchy of controls".
Prepare for many scenarios
For the most part, cannabis organizations plan short and long term surgeries. Morgan Fox, media relations director of the National Cannabis Industry Association, believes companies should prepare for a post-COVID market with several potential hurdles.
"I think companies need to balance preparing for a post-Covid world with the possibility the pandemic could last a while," says Fox.
Tessa Adams, Moxie's chief marketing officer, offers a similar thought.
"As we learned in early 2020, preparation for a perceived future is important, but it also has to be incredibly fluid," says Adams. "We are preparing for what we believe to be potential ... but we are also prepared for these things not to happen."
Public health and financial practices are likely to persist
Trip McDermott, vice president of corporate development at Bellrock Brands Inc (OTC: DXBRF), believes many COVID-19 proceedings will remain part of the plan well into the future.
BellRock intends to keep processes like online ordering, roadside collection and strict adherence to manufacturing processes.
"The pandemic condensed years of industry development in a short space of time," says McDermott.
More of this is expected in the short term, especially considering the slow adoption of vaccines in the US and the rest of the world.
Like BellRock Brands, Planet 13 Holdings Inc (OTCQX: PLNHF) in Las Vegas intends to maintain its pandemic policy for the foreseeable future. David Farris, vice president of sales and marketing, said the company stands ready to meet the needs of employees and customers as tourists return in greater numbers.
"The wearing of masks by employees and customers, the wearing of disposable gloves, and social distancing guidelines remain in place," Farris says.
Some companies also plan to continue pandemic practices that are not focused on public health.
Troy Ivan, CEO of ExtractCraft, says his company plans to continue its "very defensive" cash management strategy, which was in place back in November 2019 when the company first noticed supply chain problems in China.
"We are only just beginning to use more capital for inventories and growth, which has been on hold for a little more than a year," says Ivan, quoting the focus on growth and the constant search for ideal capital partners.
Related link: Cannabis in the Age of COVID-19: A Doctor Cancels It
Some operators are unable to function financially in the short term.
"Unfortunately, many companies have been marginalized over the past year and may not have the financial ability to position themselves far into the future," adds Ivan.
While ExtractCraft has so far been able to survive, it has had supply chain delays that hamper market aggression and positioning for the company.
"Companies with more constrained supply chains and cash flow difficulties may not have the ability to accelerate exactly the way they want," added Ivan.
Any operator can still feel the crisis from the pandemic. According to McDermott, companies must continue to find ways to make their products and services more accessible to consumers.
"Aside from new procedures and protocols post COVID, all cannabis companies will face challenges arising from the economic impact of the pandemic on people," says McDermott.
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