MedMen execs said the move is necessary to continue the company’s campaign to stay afloat.
Embattled U.S. cannabis retailer MedMen continues to cut costs — and everything else — in the wake of a troubled year, opting most recently to sell its holdings and pull out of Arizona.
The company entered the state just a year ago, but MedMen execs contend the exit is necessary to continue its campaign to stay afloat. It is also selling its Illinois factory to round up cash for its rapidly emptying coffers.
The retailer has recently cut a significant number of staff, failed to complete its attempted acquisition of PharmaCann, been forced out of the New York Medical Cannabis Industry Association over allegations of racism and sexism among execs, faced a lawsuit by former chief financial officer James Parker, and been repeatedly mocked in the media by the likes of South Park.
The downsizing is reflective of the North American cannabis industry’s recent financial woes, with many stock prices plunging and cannabis-related media companies and LPs alike attempting to minimize costs and laying off large numbers of employees.
“We are no longer in the land-grab growth phase of this industry,” co-founder and CEO Adam Bierman told CNN Business in a recent interview, explaining that prime real estate locations remain a priority for the company.
“In the high-growth phase or life of the business, we were reliant upon the capital markets to fuel that growth,” he continued. “In this chapter, we have to rely upon ourselves, our assets and how we choose to monetize those assets.”
Some critics say that while the retailer’s high-end luxury store designs may be viable in affluent locales such as Beverly Hills, Manhattan and parts of Las Vegas, it is simply not compatible with the markets in states such as Arizona.
As a result, Bierman said that MedMen will cut costs elsewhere and focus on its most lucrative markets. “Nothing in Arizona matches that right now,” he added.
The company will continue operations in Illinois, California, Florida, New York and Massachusetts.
Written by Emma Spears