Deleting this post. This isn’t worth.
Gonna need to offer a lot more then that
That’s an embarrassingly low offer. It immediately makes him look like someone out of his depth which is a red flag dipped in kerosene set ablaze on a dark night.
Me thinks he doesn’t know the costs involved with getting a license and a facility.
They can hire some other wook and pay the 30k for equip and keep 100% in gross sales.
This guy would be lucky to keep the 5-10% based on sales commissions
In addition to the mentioned points, distribution channels is easily more than 50% of the hustle. Are you bringing a well established brand with marketing to the table or are you looking to use their label to sell? Who is going to do the footwork on marketing for you, the license holder or you and your team? Are you paying your teams salary?
He’d be lucky if whoever rented the facility let him make any profit at all for the first year considering most of us were in the red for a year plus… and any foul step on his part ends up on the license holder.
Huge liability for basically 0 profit
OP doesn’t add value.
This is just preposterous.
Profit sharing margin is laughable. The concept of working with others isn’t.
this is part of a real offer I was sent directly from a laboratory and a good reference for those who want to start their own business
Wow thank you @TheWillBilly!! This is an amazing resource.
I can only see Swahili… A few English words in there, but mostly grunts and clicks.
I am not a smart man though…
How would this shake out in the end? Like, what’s the total percentage everyone would be walking away with? (48%/52%?) With this “lab rental”, does that 2.66 cover the cost of utilities, machines, etc? Covering the costs of “production” is kinda vague on what scope production entails. Thanks for posting @TheWillBilly this is a subject I know little to absolutely nothing in general
As mentioned this is only part of the offer sent but production cost generally means absolutely everything they can bill you for
2.66 per square foot
A 10x10 broom closet that you have acess to for only 8 hrs a day would cost $266 per month plus the cost of electricity.
You also would have to cover your own labor, expenses and marketing, and on top of that dedicate $20,000 per year ($1667 per month) to the facilities “marketing” (renting cars and instagram models)
All so you can compete on a market that charges 20%-50% sales taxes
Time to move on and do what must be done.
Good luck. The goal is admirable.
Please have a facility, license, everything perfect for me to walk in and use your metrc and give you 5-10%
Is how I read it.
The facility is bigger then 10x10 but even if it was its per 8 hour shift so you work M-F its $69160 yearly or $5320 per month then another $20000 yearly or $1667 monthly for marketing plus 28% of your GROSS PROFITS for sales commission
And don’t forget you have to pay far all production costs your looking at paying well over 100k a year just to be able to make the products
I understand your point, but when you come in so low, it’s like you’re not being respectful to the next person.
It’s like lowballing, only bigger
These were negotiated in cali type 7 labs and i ran a microbuisness that had many offers of 10% gross However it was for companies/brands not for you to manufacture oil. Getting manufacturing space to infuse and such is one thing getting space to actually make oil is a whole nother game. Its not like you can just drop your system in even if they had space. Its a huge song and dance, rented out about 100 sq ft of manufacturing space(c1d2 to infuse and produce products) first spot we had was making 10% on every product we produced not sold(came out to a dollarish per sku) they made 5-10k a month depending on production.
Next spot i rented out 100 sq ft mfg 100 sq ft distro for 1500 a month. A steal would be an understatement they had the space and needed cash bad.
At the microbuisness i managed we never followed thru with anything but most offers were around 10% and i know rdc, gr around here got quite a few companies in around the same price. Most these crews take less than 250 sq ft.
Oh and most had contracts that required them to buy their distillate/live resins and such so it guaranteed the lab some sales as well, while you would be competing