The marijuana boom is only in its "second inning" and the map is wide open for innovative cannabis companies seeking to establish themselves, says Nicholas Kovacevich, CEO ofKush Bottles (KSHB) .
"We are going to see this thing snowball hopefully and as more states come on board, it creates more momentum for other states to put programs in place," said Kovacevich, adding that most of his business is transacted in four states, creating huge geographical potential for him to further sales.
Kush Bottles is packaging provider, offering certified child-resistant and custom-branded solutions in all states that permit adult-use or medical marijuana. Kovacevich started Kush in 2010 and took it public in January. It now sports a market-cap of close to $61 million and has sold more than 100 million bottles.
The company just completed its second quarter for its fiscal-year 2016 on Feb. 29. Total revenue in the company's first quarter were $1,720,581, up 177% from $620,325 the prior year. The company also reported net income of $4,920 in its first quarter compared to a net loss of $87,375 the previous year.
And while one might think first-mover advantage might not be enough to sustain a competitive advantage in the packaging industry, Kovacevich said the regulatory environment is tricky enough to discourage new entrants seeking to cash in on the marijuana boom.
"As each new state regulates, it's an opportunity for us to evaluate our current product portfolio and make changes so we can continue to have innovative products that our customers need," says Kovacevich.
Customization, or the ability to help his customers brand their own products using Kush bottles, is another way Kush differentiates itself from the pack, as well as providing a higher level of service, he says.
"We've always been there for our customers, we answer the phone virtually seven days a week and we even make emergency deliveries with our own trucks if need be," says Kovacevich.