Embattled multistate operator MedMen Enterprises (CSE: MMEN) (OTCQX: MMNFF) appears to be on its last legs, with the company reportedly having shuttered all but two of its remaining dispensaries in its home state of California on Thursday.
Although no one connected with MedMen’s corporate headquarters could be reached for comment, the chain had a small fire sale to unload product this past week prior to closing down, according to a former staffer at the company’s shop on Abbott Kinney Blvd. in Los Angeles.
Former MedMen hospitality associate Jay Johnson, who worked at the Abbott Kinney location for roughly six years until he was laid off in February, said he learned of the closures on Thursday morning from a former colleague.
“The ops manager … he’s the one who texted me yesterday morning to say that they were going to close all of the California stores at the end of the day yesterday,” Johnson told Green Market Report.
Johnson said that he heard through the grapevine, however, that MedMen locations at Los Angeles International Airport (LAX) and in the Torrey Pines neighborhood of San Diego would remain open. Budtenders at those MedMen shops answered the phone Friday and confirmed the two stores are still operational.
At other MedMen stores – including the company’s downtown L.A., Venice, Beverly Hills, and Orange County shops – there was no answer.
At the company’s height, it had 13 dispensaries scattered across California, according to securities filings.
Johnson told Green Market Report he thinks MedMen’s days are now numbered.
The fire sales this week at some of the stores had products up to 75% off, according to a text message received from a former colleague.
“End of a crazy era, for sure!” the message read.
“I think they’re done. On top of everything else, because they’ve been selling off pieces of the company the past couple of years, but as of recently, they were still close to $200 million in debt,” Johnson said. “But you never know.”
As of Friday morning, the MedMen Enterprises corporate website was down and had only a placeholder message which read, “We’ll be back soon. Sorry, we’re down for scheduled maintenance. In the meantime, connect with us on social.”
No one at MedMen could be reached for comment Friday.
The report of more closures follows a series of troubling developments for the company, including a string of earlier dispensaries closing down – including MedMen’s flagship store in West Hollywood in February, then its shops in San Jose and Emeryville the same month, and just this week, the company closed its San Francisco location.
The news also follows a string of C-suite departures, with ex-CEO Ellen Deutsch Harrison resigning in January after less than seven months on the job.
Johnson said that was a critical development for MedMen, because it cost the company its relationship with top edibles maker Wyld.
“Wyld … called MedMen and said, ‘We’re out. We’re done. If she’s not CEO, we’re cancelling all orders,’” Johnson recalled, adding that Kiva, another major edibles brand, had already cut ties with MedMen last year over nonpayment for inventory.
“Those were our two biggest sellers: Wyld gummies and the Camino gummies by Kiva,” Johnson said. “This past month, I know they were just selling what was left. It looked pitiful.”
MedMen shares haven’t been trading on the Canadian Securities Exchange for months either, since the company filed a cease trading request with the CSE last fall. Its shares reached zero value on the over-the-counter markets in January. That was also a major catalyst for the California layoffs and store closures, Johnson said, because previously MedMen had been trading stock shares for store inventory.
MedMen also has not filed a quarterly financial report with securities regulators since last May, when it reported its first quarter 2023 financials. At that point, MedMen had just $7.6 million in cash and a working capital deficit of $383.2 million.
MedMen also posted a net loss of $31.2 million that quarter.
Since then, the company has been selling off assets left and right. The company exited the Arizona and Nevada markets entirely. The company still reportedly has operational assets in Illinois, Massachusetts, and New York.
The news of MedMen’s California closures caught some of its business partners in California off-guard.
“You’d think that – because I sell products there – that they’d give all the vendors a heads up, but nope, they definitely did not,” said Amber Senter, the CEO of cannabis brand Makr House. Senter said MedMen still owes her and many other brands, but she’s not counting on getting paid.
“They owe me money still. Not a lot, like a thousand bucks, but you still owe me money,” she said. “I’m sure they owe everybody money.”
Senter said she expects this is the end of MedMen Enterprises.
“If it hasn’t happened already, yeah,” she said, when asked if she’s expecting the company to go under. “I don’t know if I can call it karma, because the folks who did all the damage wound up skating away. They thought they built this company that was a tank, and it tanked.”
Read More Feedzy
