A while back – quite a while back, if we’re honest, Tinley Beverage (TNY.C) boss Jeff Maser had a big decision to make that would take his company in a specific direction from that point forward.
He could choose to ride or die – which would mean making hemp/cannabis drinks through third party facilities and riding the short term glory of being able to say he had products on shelves early. The downside of that would see potentially lower margins and lack of supply security, as well as the risk that changing market needs might see some of those products fail, leaving the company with nothing.
Or he could put his capital into building a bottling plant of his own, taking a longer road to glory, but being the master of his own destiny from that point forward, with better margins and full control of his supply chain.
To the annoyance of day-traders, he chose the long path.
Sure, there were test products here and there, and a lot of reformulations and missed market bubbles as he built out his team, plant, and product lines, but credit goes to Maser for having a long term plan that has, as of today, played out in full, was timed to perfection, and is now scalable, paid for, and market trend agnostic.
Today, Tinley announced it had agreed a deal with a mainstream west coast store chain, Bevmo!, to put a non-cannabis version of its cannabis-infused non-alcoholic drink lines in 150 stores from Arizona to Washington.
If you’re paying attention, yes, these are non-alcoholic, non-cannabis, ‘alcohol cannabis’ drinks. which is a mouthful.
Here’s what they look like:
I would drink these products. I would have them in the office. They are an attractive brand that will resonate with female consumers as much as male, and I can’t wait to see them up over the border into Canada.
More than that: I can’t wait for Tinley’s mainstay cannabis products to get up here and, I suspect, when they do and investors can see and feel and taste them, the stock will go bonkers.
The markets haven’t rewarded Tinley for this Bevmo! announcement at the time of writing, but they should, because being able to put together deals like this WHILE STILL GROWING YOUR EXISTING PRIMARY PRODUCT LINES is exactly the benefit of having made that bottling plant happen.
The deal, which will see Tinley products branded as ‘Becketts’ to properly separate cannabis brands and non-cannabis brands in accordance with regulations, will still retain much of the Tinley packaging style, naming elements, and ‘packaged by’ information.
This is seen as an entry for Bevmo! into the surging non-alcoholic cocktails market and, for Tinley, a chance to further market itself among mainstream consumers…
And earn a cool million bucks while doing so.
Based on anticipated demand, the company plans to produce in excess of $1-million of products in Q4, valued based on their wholesale selling price, inclusive of cannabis and cannabis-free products. This represents significant growth since the company’s initial products first landed on dispensary shelves 22 weeks ago.
From zero dollars to $1 million in just 22 weeks.
Folks outside of the west coast may not have heard of Bevmo! and be unsure whether this deal has teeth. From the look of their website, being first into the space Tinley occupies is right in line with their business model:
Our buyers work really hard to be first to market with all the latest spirits, wine, craft beer, soda, snacks and more. Our stores have thousands of items from every beverage category to please even the craziest request. Looking for chocolate bitters? We have that. Want to try Moonshine? Which brand are you looking for?
Tinley boss Maser sees nothing but good things in the deal, telling me, “It happened because our cannabis line is now in 50 stores across California and receiving rave reviews. They tried it, liked it, and wanted their own version that would be attractive to the canna-curious market, which is a really big segment of the population.”
Not everyone is ready for a drink that will get them stoned, but the halfway point, where the flavours are there but the DUI-likelihood isn’t, is much larger than the traditional cannabis enthusiast demographic that everyone chases.
Tinley’s ability to produce product with new formulations, without having to build or outsource a whole new production line, makes the deal possible without having to undergo a full company pivot with every new deal.
Others agree:
Ability to sell those products across the US, not just in select states. Which will open up consumers to $TNY beverages and branding, ahead of US legalization. If consumers are waiting for the “show me” stage of ops, the company has begun that stage with today’s news 2/
— The Deep Dive (@TheDeepDive_ca) October 22, 2019
“We’re releasing new flavours often now, and the white label market is one where we see a lot of growth going forward,” he said. In accordance with that, Tinley today announced it will have a new “coffee liqueur-inspired Tinley ’27 Coffee Cask beverage in cannabis-infused format toward the end of the year.”
Their timing couldn’t possibly be any better, with new rules now coming to Canada that will make their products legal across the country. Any LP not talking to them currently about bringing those products up north is failing their shareholders.
Naysayers will point to this not being a monster deal with a Monster Energy-sized product and say, meh, but they’re missing the grand strategy here. Maser has built a team with significant mainstream beverage experience that understand the ability to be all things to all people is a strong business. Restaurants are putting an increasing focus on ‘mocktails’ and Tinley products are right in that wheelhouse, be they cannabis-infused or otherwise. Mainstream grocery stores are in the same boat, hence this deal.
There are a lot of companies – TGOD, Pivot Pharma, Sproutly, Naturally Splendid, and more – that claim a unique IP when it comes to making cannabis beverages a real thing. Tinley has actual products being sold. It’s two years ahead of the IP crowd.
Cannabis-infused, cannabis-free, alcoholic, alcohol-free, or just plain old soda – there’s money in all those trees, just ready to be picked if you bothered to build yourself a ladder to get at it all.
Tinley built a ladder.
— Chris Parry
FULL DISCLOSURE: Tinley has been an Equity.Guru marketing client since both companies were wee bairns.
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