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99 Cents Store Sources CBD From Valley Trio

A CBD company run by a trio of Valley businesswomen has entered a deal to white- label CBD-infused lotions for 99 Cents Only Stores. Blumenes, jointly founded two years ago by Yael Rubin of West Hills, Mishel Elkayam of Woodland Hills and Stephanie Levaton Cobos of Sherman Oaks, was contacted by the discount retailer earlier this year after debuting its first organic CBD cream for muscle and joint relief. “Because we sourced so well and have such a good connection with our lab, we are in a position to be a wholesaler, retailer, distributor and white label. That’s organically what happened,” said Rubin, who oversees marketing and account management. Levaton Cobos, a friend of Rubin since high school, manages operations and sourcing. And Elkayam, a career graphic and interior designer, handles branding. Blumenes’ flagship product contains 1,000 milligrams of Cannabidiol, or CBD, a non-intoxicating byproduct of cannabis that relieves pain and anxiety and treats some skin conditions. Because of the high dose, a 100-milliliter bottle is priced at $89 – a high barrier to purchase for some consumers. Rubin said a senior buyer at 99 Cents Only approached Blumenes to create a similar but more modest product that could be listed on its shelves for $10 or less as a private label. “It took us just a month,” she said. “We sat with the chemist and we came up with a great product that would sell anywhere else for $30 to $45. We sold it to the 99 Cents Store and they’re selling it for $6.” Added Levaton Cobos: “There is a different market for everything. … We love our gold product, but at the same time, we see that there’s a need for other types of products. Not everybody can afford that.” The trio didn’t disclose financial terms of the deal. Levaton Cobos and Elkayam became interested in CBD when they saw it help ease their parents’ pain through severe physical injuries – Levaton Cobos’ father used it after a traumatic car crash, and Elkayam’s mother used it for pain management as she fought kidney failure near the end of her life. Driven by their experiences, the three spent years conducting market research, finding a CBD source in Colorado, vetting local laboratories and perfecting an organic, high-dose recipe that masked the nauseating smell of raw CBD. That legwork culminated this spring with the arrival of a big-rig truck to Rubin’s house, dropping off the company’s first palette of ready-to-market lotion bottles. That was March 17. “We were shut down before we started,” Rubin said. “I spent three weeks mentally shut down. But (another) three weeks later … things started happening.” With a background in the nonprofit and medical industries, Rubin was able to shore up some sales to medical offices and niche retailers. Customers eventually grew to include radiologists, cardiologists, pharmacies, at least one sports injury therapist, a marijuana dispensary chain called The Syndicate, which has locations in Tarzana and Woodland Hills, and even a traveling massage therapy app. As for e-commerce, Amazon.com doesn’t allow CBD products on its platform, but it does allow hemp-based ones – the group made a version of its pain relief cream with hemp instead of CBD specifically to sell on the website. All told, the company has sold more than 50,000 bottles in four months. Rubin said it’s rare to see a CBD company run by women. She said part of the company’s sales strategy moving forward is to reverse engineer the traditional gender dynamics of the industry. While the business side of CBD is largely dominated by men, she said, the consumer side skews towards women. To subvert that trend and tap into a fresh buyer base, Blumenes is planning to market its upcoming line of anti-aging creams to men. “Men want great products but they don’t know how to seek it out,” Rubin said. “The men’s industry is starting to grow. But the door hasn’t opened yet. We want to be on the forefront of anti-aging products especially for men.” Despite the group’s success with original products, Levaton Cobos said the company is likely a “build to sell” project. “I think it will be something we’re going to want to sell in three to five years, and white-labeling will be fuel behind it,” she said. “In the end I think we’re going to be brand developers. It’s fun to be creative.”

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