NxGen Brands Inc. (OTC: NXGB) is to partner with a digital supply chain & blockchain developer Bengala Technologies to allow the company to enter into the rapidly growing U.S. cannabis dispensary delivery services market.
The partnership will allow NxGen to deliver its own proprietary brands of flower and Leafywell™ products and will allow it to create a national network to provide delivery services for dispensaries across the country.
The market for sale and delivery of recreational and medicinal cannabis is projected to see explosive growth through 2027 reaching $73.6B, and with this collaboration NxGen will be hoping to be at the forefront of the projected wave.
A cannabis dispensary delivery provider must adhere to multiple local, state and national regulations, including licensees, transportation and delivery requirements. The blockchain digital supply chain technology apps to be developed will address these issues and allow the Company to be compliant and adhere to the regulations across all national markets.
Angel Burgos, the Company CEO said: “Cannabis companies that provide delivery services – including delivery operators and retailers – are seeing a deluge of orders as customers stock up on marijuana products in the wake of current pandemic concerns. Our hope is that, after opening projected operations in California, Michigan and we will then do the same in Florida. Initially for medicinal delivery services while awaiting pending recreational approval. Internal research has demonstrated that faster delivery can spur increased sales and help to increase revenues.”
Bengala Technologies LLC, achieved excellence in the field of blockchain consulting and development by creating and deploying custom decentralized blockchain and supply apps including Supply Chain, Blockchain and Smart Contract Development applications.
Mr. Arnaldo Detres, the Managing Director of Bengala Technologies LLC, said: “There are so many variants of regulations in the cannabis delivery services and blockchain can meet these regulatory and supply side needs from available inventory and supply to delivery for the proposes of local authentication and validation rules. Blockchain can enable more transparent and accurate end-to-end tracking in the supply chain organizations can digitize physical assets and create a decentralized immutable record of all transactions, making it possible to track assets from production to delivery to end user.”
According to a recent report by ArcView Market Research and BDS Analytics, the global licensed dispensary sales of cannabis will reach $40.6 billion by 2024, registering a CAGR of 24.5%. The US will account for about $30 billion or 73% of the global cannabis dispensing market in 2024. It is projected that by 2024, the retail dispensing sales of legal recreational cannabis will cross $26.7 billion, whereas the revenue generated from the sales of medical cannabis will reach $13.9 billion. The retail sales of THC containing products from licensed dispensaries across the US will feature growth of nearly 300%, i.e., from $8.4 billion in 2018 to more than $24.7 billion in 2024.
The partnership will allow NxGen Brands to produce and ship via its proprietary direct delivery network with the software and technical technologies created by Bengala Technologies LLC, both existing CBD based SKU’s and cannabis-based products. This will allow the Company to market throughout the states which have recreational and/or medical and continue to establish and grow the Leafywell™ branded products.
NxGen has also said that it hopes to expand the licensing deal to possibly focus on combining its brands with medical licensed producers, in a bid to shape how future cannabis brands operate in the United States.