1-800-Flowers CEO Jim McCann says that despite the company’s efforts to utilize domestic flower growers, the growers in certain states are considering growing marijuana as a potentially more profitable option.
“We have been pushing for domestic production of flowers hard for the last 10 years and having real good success,” McCann told the FOX Business Network’s Maria Bartiromo.
But McCann noted that many flower growers are now tempted by the huge potential revenue boost from growing cannabis instead.
“There are a few states now, I haven’t seen it impact us yet, but we are concerned because some growers with enormous greenhouse facilities in California or Colorado or perhaps in Oregon are saying, ‘Is this the best crop I can grow, these flowers for all these florists around the country? Maybe I can switch to legal marijuana and get 10 times on the revenue line.’ That’s a big concern of ours.”
Even though it has not had an effect on the company yet, McCann says many growers are close to a decision on the potential shift in their business.
“We haven’t seen it manifest itself yet, but a lot of people are on the precipice of making a decision,” McCann said.
Adding to the concern for the 1-800-Flowers CEO, McCann says the states where it is legal to grow cannabis are also the best for flower production.
“The only places that we know of are legal marijuana states, so that’s where we’re seeing it but they also happen to be our best flower producing states.”
On growers’ potential switch from flowers to legal marijuana hurting his company’s supply, McCann said, “That’s a concern we have, so we’re working with them all the time to make sure we do the right analysis. We’re more for rose production than we are for cannabis production.”
The rigid rules and capital requirements to grow in legal states will set a high bar for anyone entering the industry.