In a letter to shareholders, Calabasas-based cannabis company Resonate Blends said it was “disappointed” with its sales performance following the issue of its 2021 annual report.
Sales of Resonate’s first product, which are six formulations of its Koan Cordials, were less than the company expected. The cannabis-based cordials are small bottles of liquid that consumers can drink or add to a beverage. Each delivers a different experience, as indicated by titles such as Calm, Wonder, Delight and Play.
“The pandemic led a large percentage of the California dispensaries to stop taking on new brands and there was a significant movement towards commodity pricing of undifferentiated products,” the company wrote in a statement. “This combined with high California taxes, a vibrant grey market and that our pricing was set as a unique luxury product, exacerbated the slow sales.”
Resonate announced the launch of its Koan Cordials in May last year.
In its annual report, the company reported $27,031 in revenues for the year ended Dec. 21 and a gross profit of $7,883.
“Launching our first brand during this turbulent period was particularly difficult,” the company wrote. “That said, we have built the foundation for solid growth, innovation and potential acquisitions going forward.”
Shares of Resonate Blends closed at 8 cents May 4 on the over-the-counter market.