Gen-Alpha, Cannabis Labs & Mom Economy 👪

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An Old Shoe Factory Turned Into a Cannabis Lab

With states increasingly legalising the sale of medical and recreational marijuana, cannabis is already a bona fide cash crop. The global cannabis market size was valued at $10.6 billion in 2018 and is projected to reach $97.35 billion by the end of 2026, according to Fortune Business Insights.

Companies are already seeing unprecedented rise in sales and revenues. Take this Massachusetts-based company - Revolutionary Clinics - for example. Massachusetts legalised recreational marijuana in November 2016. By 2020, Rev Clinics had booked $40.7 million, up 32,997% from 2017. 

But the set up wasn’t easy. 

Ansin, the founder of the company, had an empty 250,000-square-foot warehouse facility in Fitchburg, Massachusetts, that used to be an old shoe factory. It took three years and over $50 million in funds (from angel investors) to set up a cannabis growing facility, now called Revolutionary Farms. 

The facility now produces about 50 exotic strains of cannabis plant and close to 200 original cannabis products in various forms, from edibles to vaporisers, tinctures, and topical creams.

Despite all this, for most companies like Rev, the business is far from set. Cannabis is a startup industry. And it’s hard navigating the dynamics of a startup company, in a startup industry, in a state whose laws and regulations do not always match. 

Hiring Crunch Hitting Small Businesses 

A new survey by Salesforce shows that 53.3% of SMEs have had staffing issues this year. Of these, 56.6% reported at least a 10% hit on revenue and profit. The report suggested that most employees leaving or refusing jobs fell in the millennial category and were motivated by the "You Only Live Once" mentality. 

Echoing this sentiment was a survey for the NFIB July jobs report, which found that 49% of small business owners had job openings that could not be filled—a 48-year record high. According to the report, the biggest concern for small businesses was labour quality and qualifications. Majority of the owners reported few or no qualified applicants.

A separate NFIB survey indicated that for most small businesses earnings fell by about 13%, owing, in part, to the lack of labour availability. Large companies, by contrast, have been reporting huge earnings growth. Majority of the S&P 500-listed companies reported revenues above the mean estimate for Q2, according to FactSet.

Job openings in the U.S. surged to a record high of 10.1 million in June, while hiring lagged behind that figure by over 3 million, painting a picture of an economic recovery held back by hiring woes.

Millennials, Gen-Alpha and the Mom Economy

Studies show that children as young as 3 can recognise brand names.

This finding is not lost on baby brands -- which have turned their attention to Generation Alpha (children born between 2010 and 2025).

This next generation of consumers is being born at the height of American excess. They will grow up in a world oversaturated with direct-to-consumer brands, one where social media is shoppable, Amazon is ubiquitous and marketeers are monitoring their behaviours since childbirth.

But right now, they are still too young to have preferences or identities. They don’t resonate with any brand or its values yet. Typical ad targeting doesn’t work on them because data about their characteristics is unknown. As a result, their mothers have now become a key marketing demographic. 

Data on Gen Alpha’s parents, the millennials (which is available in abundance), can forecast how these children will be raised. Whatever the parents expose the child to, the more often they will come to identify with that brand even from a very young age.

The parenting industry — or the “mom economy” — has moved largely online in the last few years. Mothers shop off Instagram, follow recommendation from mommy blogs, and are privy to staying in line with social media trends. Which is why traditional brick and mortar companies like Toys R Us and Hamleys are also moving digital to woe these parents. 

Starting from the turn of the century, we began to realise that millennials would wield the greatest consumer power in the world, compared to all other age groups. They were the first of the generations to become victims of ad profiling and targeted marketing.

And millennial parents now guiding Gen-Alpha’s choices, makes them the biggest marketing demographic of all time.

Shorts ⏳
  • Data of nearly 50 million T-Mobile customers hacked - customers' names, DOB, social security numbers and driver's licence numbers compromised. 
  • United Airlines had to remind flight crews not to duct-tape passengers to their seats after a video of an attendant taping a passenger went viral this month.
  • More than 100 million U.S. households, or 61% of all taxpayers, paid no income taxes in 2020, according to a new report
  • Remote work leaves us more vulnerable to cyber-attacks. Network security firm Barracuda Networks said there was a 667% increase in malicious phishing emails in 2020. 
  • Walmart may be headed towards cryptocurrency - the company is reportedly hiring a cryptocurrency lead strategist. 
  • At one point last year, there were ~1.1B grams of marijuana held in storage in Canada
  • Musk plans to send humans to moon before 2024 - per his response to a Twitter follower. 
  • The Traffic Safety Administration in U.S. opened a formal investigation into Tesla’s autopilot technology after 11 reported accidents since 2018. 

Stash Recommends: Tools to Explore
Xero: cloud based accounting software built for small business that manages inventory, employee payrolls and financial records.

ShipStation An order and delivery platform that helps e-commerce businesses integrate and connect business operations on one easy-to-use platform.

Powered Now: A field service management software tailored for trade companies that offers an integrated workflow platform to streamline administration.

nTask: A project management software with over 150,000 customers that enables teams to collaborate, plan, analyse and manage everyday tasks.

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