Episode 111 – Catching up With Cardinal Bay Distribution

 

 

Joe: Coming up on this episode of the "CPG & CBD University Podcast," we welcome back Cardinal Bay Distribution, one of the early adopters of hemp-derived cannabinoid products. We'll look back at 2021 and their outlook for 2022, plus the new products they're expanding their inventory with. This is the "CPG & CBD University Podcast," and it starts right now.

I'm Joe Agostinelli, host of the "CPG & CBD University Podcast." We welcome you back to our podcast. And don't forget to hit that subscribe button, wherever you get your podcast, for notifications of new episodes each week. Don't forget, you can catch video episodes of our podcast on the Global Widget YouTube channel. Link to that is in the description of this podcast.

It was way back, and it's so weird for me to say that. It feels like we've...you know, every episode we still just started, but it's been more than two years. Episode 40 is when we first introduced you to Cardinal Bay Distribution, a long-time distribution partner, and that was back in September 2020. A lot's changed since then. And I welcome back to our podcast, Chase Cranford, the founder and managing member of Cardinal Bay Distribution. Chase, welcome back.

Chase: Hey, thanks for having me back, Joe. I'm excited. I love being on this podcast. I love being on any podcast.

Joe: Anytime. We saw you in the office not too long ago. And...

Chase: Yeah.

Joe: ...you're back now and joining us via Zoom, for those of you watching the video episode. Remind our listeners and viewers again about Cardinal Bay Distribution, for those who may not recall from 71 episodes ago.

Chase: Yeah. So Cardinal Bay, its genesis was actually back in around '93, is when we actually started in the distribution portion of the health food and the herb store clientele. And we went totally hemp in 2019. We just saw the writing on the wall after the Farm Bill was passed. But we've been doing business with Global Widget since 2016, since day 1. And we just couldn't be more pleased with the relationship we had with you all.

And as I mentioned in the intro, a long-time distribution partner in...hey, since day one. Let's be honest, more like family. We said got started back in 2016, and you continue to grow the inventory. And you talked about going all hemp in 2019. How was 2021 for Cardinal Bay Distribution, and how do things look as we get into 2022 now?

Chase: Sure. So, you know, I would classify 2021 as extremely solid. It was led by the growth in the cannabinoid isolation boom that we see with all these new products, Delta-8, of course, being the story of the year. 2021, you know, it was extremely steady. Ever since we adopted the Delta-8 products in October of 2020, we've been pushing and pushing and been so excited for Global Widget to release the Mystic Labs line, which has been gangbusters and just absolute phenomenal product line with a product choice like I've never seen before. And it's just been fantastic. You know, we probably missed a few swings at some low-hanging fruit out there. We were a little slow to adopt some of the Kratom products. I know we'll talk about that in a bit. But I'd say 2021 was extremely solid. It was very clear to see our trajectory, our growth. The product mix growth has been fantastic, alongside with you all, of course, being manufactured, authorized master distributors for you all. And we couldn't be more excited for 2022 because we already have seen some of the products coming down the pipeline, and we're really excited to offer this to our customers.

Joe: And I know we touched on Delta-8, and we'll talk about the Kratom in just a little bit. But how has CBD been doing for you recently?

Chase: So, you know, I'd say CBD is still in the game in a big way. You know, we've seen some year over year waning in sales of the CBD products, and that's really for a couple of reasons. Number one, I know that a lot of the CBD products that we have offered in the past have been cut just because the manufacturers that we do business with, you being the primary one, of course, we like to look for manufacturers who are willing to take a chance on some new product lines. And not all the time will that work out, but I'd say more times than not, it at least gives us some information. Some of the topical products we've cut from not necessarily Global Widget's line, but other lines. And we've kinda shortened up our product mix to the core, which is the gummy, the capsule, the edible, the oil, and the topical. And that has helped us streamline our sales and our conversations with customers about CBD. But, you know, CBD still comprises roughly 45% to 50% of our total sales.

Joe: And we touched on this in your first question. But as for hemp-derived cannabinoids who are making that jump into Delta-8 and Kratom, what was the education and transition like into selling Delta-8 and products in addition to CBD?

Chase: Yeah, so obviously, we were poised to do it probably better than most others since we do focus on legal cannabis. The conversation was basically this, "Look, there's a new cannabinoid out there that has been doing some phenomenal things for folks. I try all the products that we distribute. I've been a legal cannabis user since day one, and I find that these product have really helped me personally with sleep, anxiety, different issues." And, of course, it's different from everyone. But the conversation was, look...what we always tell our customer, if you're not offering this product to your customer, someone down the street is gonna be doing it very soon. And that's something that resonates with our independent customers. Again, we specialize in the independent retailer, the brick-and-mortar, mom-and-pop shop. And typically, when we spend our money, or we pick up the phone to give them a call or send them a marketing deck, they're gonna pay attention to us. Our average customer has been doing business with us for well over six years, and they've seen a lot of success with us, as we've seen with you all, with Global Widget, and there's no reason for folks to not try it, especially when you have a manufacturer that is willing to offer what I believe is the most important thing in bringing any product in, which is ample amounts of samples, starter kits. Having a manufacturer that's investing in your success at the customer level, at the retailer level, speaks volumes.

So, you know, the Delta-8 side, that was a little bit easier just because we have been telling our customers for years that there are gonna be new isolated cannabinoids, and that CBD is really the root, the legal hemp industry, the legal hemp movement. The root is the CBD. But all the branches that are gonna branch off, you've got THC-O, you've got THCV, CBG, you have, of course, with the legal language, you can have legal hemp-derived Delta-9 now in certain products, Delta 10. You've got all these different products that are really able to piecemeal and go after certain...yeah, I say, ailments. These are not things that are being marketed as such, but individuals who do the research will know what certain products are targeted for. And that's really what these customers do. Again, being in the health food and herbal realm that we are in, the majority of our stores are looking for these solutions that are tailored to certain ailments, certain issues that folks face. And isolating different cannabinoids is, in my opinion, a no-brainer, and making it such that the product mix can grow and everybody will have a lot different options on the shelves. And for us, that's fantastic.

Now going into the Kratom side, I've been on the sidelines of Kratom for a long time. As a matter of fact, I didn't really understand it. I've had people tell me about it. I've had stores tell me about it. And I said, you know, I don't have a manufacturer who's really going on a limb and trying to make these new products that...and specifically, we like offering edibles to our customers, don't really see many edibles on the market, and all the powders and all the different confusion. I needed one product out of a brand that I could send to my customers, they could try, they could have the customers try. And that's really what the Trifecta line, as well as the...of Mystic Labs, as well as the MIT 150 line, has been able to do. It's been able to provide a concise product. It's already been manufactured, and folks can actually pop it, try it, you know, give feedback. And we've had phenomenal feedback, and the sales have really taken off on the Kratom line, which is not really surprising to me now because I'll tell you a story.

I went on a guys trip with a bunch of friends from school about eight months ago. And one of my friends, who had been struggling in the past with some things, told me about how Kratom has helped him out. And he seemed like a completely different person. And that made me sit up. That made me very happy. So I went back and I pulled my customers, my top customers, my top 30 customers, and I said, "Look, where does Kratom fit in your mix?" And we had people come back and say 20%, 30%, 40% of their total sales is in Kratom, and it blew my mind. And of course, that made me pay attention. So the fact that we have a distributor, a distribution partner, a manufacturing partner, Global Widget, like Global Widget that make these products and to provide safe, effective products for folks, it made me just make it a no-brainer, and we just backed up the truck. And now we're right in line to see some serious sales from these products. So we couldn't be more excited about that.

Joe: And other distributors are probably in the same boat you are as new products and new brands come out. So what advice would you have for other distributors who may be looking to go along that same route as you have, and offering new hemp-derived cannabinoid products to their customers?

Chase: Yeah, great question. So I would...I don't like giving advice to my competition, but...no, I'm kidding. I'd say go for it because honestly the products are phenomenal and they're helping so many folks out and really just everything about it has been fantastic. Anytime you can present and get in front of a customer, and offer something new that you know is gonna be effective for their customers, go for it. But I will say with these products, particularly the products in the cannabinoid space, what I always tell our customers and anyone who asks is to make sure that there are COAs, make sure that there's private labs running these tests, and that the documentation's available on the website, or through a QR portal, or in physical so that you don't have any, you know, issue with a customer who might ask a question that maybe you can't answer. That gets awkward. And also you wanna make sure that there's a pesticide in the metals test for the raw ingredient for all of these products because they come from the ground, and they're harvested, you know, with machinery and processed with machinery. The last thing you want is be ingesting metals. And I know that's...again, this is something that Global Widget has done from day one, and I'd say just make sure the products that you're offering and you're distributing are safe and effective and that the manufacturer's gone out of their way to make sure of that.

Joe: And speaking of making it easier to offer products and brands, you're making it easier for your customers to order brands and products. How about the new website that you just, I understand, just rolled out?

Chase: Just rolled out, I got late, but early this week, couldn't be happier. We've been, for the longest time, pretty much in the shadows of the distribution world for a couple of reasons. Number one, in this space, number one, the main reason is because we're not a very large company. We are growing very fast and we are becoming a larger company, but I've always wanted to do things at a pace that I know is comfortable for our consumers, especially our customers, our retail customers. It's really been one of those things where most of the time folks just pick up the phone and call us, they know us by name. I mean, whoever picks up the phone at Cardinal Bay, you can talk with them, we don't work on commission, we're there for the customer. But I've constantly had, "Chase, you gotta do a website, you gotta do a website, you gotta do something better." I've always had, like, an online order form for folks to go on and order and that's been easier, but I really need something to face the manufacturers, face the consumers, face the retailers, the ultimate retailers who are our customers, something that looks fantastic. And we've done that with www.cardinal-bay.com. It's been fantastic. We offer all of the products on the website. Of course, our primary products are the products from Global Widget, your Hemp Bombs, your Nature's Script, and, of course, the hottest new product line Mystic Labs. And that's our primary showcase, but we just have to have that because so many folks that are looking for your products, Hemp Bombs, whatever, they need to be able to go onto a site that's closed that you cannot see the wholesale pricing for. Only approved members can see wholesale pricing, and, of course, we don't sell direct to consumer, and compete with our customers. But we just needed something there for the information, for the visual, and we've seen a very, very rapid growth, just since we launched it, in our community, and it's been so great and we've had phenomenal success with the website so far, and we look forward to growing it. And it's just so cool to hear our customers say, "Finally, you did it. You did it for us." I mean, we're a small company, you know, we don't like to spend a bunch of money on marketing, and this, that and the other, we let the manufacturers handle that side of things, but to do something that our customers want...have wanted for a long time and make their lives easier it's been great. And I encourage anybody to go on there. If you're a customer of ours, you'll be able to see all of our offerings and pricing. And if you wanna be a customer of ours, let us know, and we would love to clue you in and check you out and get you all these great products. So again, we do business in all 50 states. We have roughly 850 customers now that we're servicing all independent retailers. And we would love to...love for folks to check out the website, and I will approve you quickly if you're a store and we'll get you all set up. So thank you for asking me about the website, Joe.

Joe: Yeah, and we'll put the link to that right in the description to this podcast episode, make it easier...

Chase: That'd be great.

Joe: ...for folks to find if that's all right.

Chase: Awesome.

Joe: Perfect. And, you know, I was gonna ask, now I understand, and I've seen different weather systems moving up your way, that there's some snow on the ground, so it's probably a bad time to ask how the golf game's going, but...

Chase: Well, you know, the last year...December to January, I typically hang up the sticks, but what I would typically do, if there's snow on the ground, Joe, is I just play with a yellow ball or an orange ball.

Joe: There you go, there you go.

Chase: But no. The game...

Joe: You know you're diehard in a way.

Chase: Yeah. The game is seriously struggling right now, quite frankly. So I'm gonna stick to work, and let the sun come out and then I'll get the sticks back out.

Joe: There you go. Well, next time you're down here we'll do an in-studio podcast. We'll head out to the golf course. I don't think Vince golfs because there's no like three-piece suits you can wear on the golf course. I can make that...

Chase: Oh, that's true. That's a good point.

Joe: Yeah.

Chase: That's a good point. Yeah.

Joe: Yeah.

Chase: Yeah, that would look a little strange, but he can drive me around. It'd be fine.

Joe: There you go, perfect. Perfect, because he's a frequent guest on the podcast. Everybody who watches and listens to our podcast knows exactly what we're talking about. So we're good.

Chase: Oh yeah. Very dapper man.

Joe: Absolutely. Well, Chase, thank you, as always, for coming back on the podcast. Great conversation, and I look forward to having you back on the podcast and here in the studio sometime soon.

Chase: Most definitely. I can't wait. I guess down in Florida, the weather's a lot different so I guess I can come anytime. You just invite me. Okay?

Joe: Anytime.

Chase: I'll be there.

Joe: Sounds good. I'm not sure you'll need an invitation to come visit, but we'll figure something out.

Chase: Okay, cool.

Joe: Chase Cranford, the founder and managing member of Cardinal Bay Distribution, my guest on this episode of the "CPG & CBD University Podcast." Don't forget to hit the subscribe button wherever you get your podcast to get notifications of new episodes each week. You can also catch video episodes on YouTube. I'm Joe Agostinelli, host of the "CPG & CBD University Podcast." Thank you for tuning in.

These statements have not been evaluated by the Food and Drug Administration. CBD products are not intended to treat you or prevent any disease or condition. You must consult your personal physician about CBD and using CBD products. CBD should never be used by anyone under the age of 18. This podcast is not intended to provide legal advice regarding the legal status of CBD and CBD products.