Curaleaf Lays Off 220 Employees To Control Costs, Drive Efficiencies: Trend As Cannabis Companies Struggle?

Curaleaf Lays Off 220 Employees To Control Costs, Drive Efficiencies: Trend As Cannabis Companies Struggle?

Curaleaf Holdings CURLF laid off around 220 employees ahead of the Thanksgiving holiday, the Business Insider reported.

In a statement to the outlet, Curaleaf said the cuts were "part of an effort to control costs and drive efficiencies in the face of economic uncertainties ahead."

The news should come as no surprise after Cantor Fitzgerald's Pablo Zuanic recently lowered the price target on Curaleaf's stock following the company's Q3 earnings report. Zuanic noted that Curaleaf is looking for at least $40 million in cost savings for 2023.

You've Got Mail

Curaleaf CEO Matt Darin delivered the lay-off news in a company-wide email to employees. "I don't like having to deliver this news, and we haven't reached this decision easily," he told workers. Darin, who took over the top job at Curaleaf this past May, said the company was in discussions with unionized employees at affected Curaleaf locations.

While there is no information as to which departments and locations are affected by the layoffs, workers at an Edgewater, New Jersey dispensary must be happy they unionized in October as members of United Food and Commercial Workers.

Curaleaf is not the only company undertaking cost-saving moves as the cannabis industry has been affected by plummeting weed prices, heavy regulations and the ongoing lack of banking access. In June, Flowr Corp FLWPF cut 40% of its workforce in an effort to save the company from bankruptcy. Other notable examples of mass lay-offs this year include Aurora Cannabis ACB, which cut 12% of its global workforce in a scheme to save up to $69 million. Then, cannabis tech company Dutchie laid off 7% of its staff in June.

What's To Be Done?

One wonders what could turn the tide for the struggling cannabis industry. That question has been much discussed and debated though most agree that financial stability in the form of access to the banking system would go a long way to providing stability all around.

Enter the Secure and Fair Enforcement (SAFE) Banking Act, bill that would allow cannabis companies to obtain access to much-needed banking services, which is denied them as marijuana remains a Schedule I drug. 

One of the bill's major sponsors, Rep. Ed Perlmutter (D-CO) is urging Congress to pass SAFE before the lame-duck period in Congress ends in January. He says he's optimistic.

“The optimist says, ‘we’re gonna get it done.’ There are several ways we can do it,” said Perlmutter.

We can only hope that logic prevails and the booming cannabis industry is provided the assistance it deserves before more and more workers get the same email the Curaleaf employees received in their inboxes.

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Photo by Richard T on Unsplash

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Posted In: Cantor FitzgeraldDutchieMatt DarinpremiumRep. Ed PerlmutterUFCWCannabisNewsPenny StocksSmall CapMarkets