How legal weed disrupted a flower startup's supply chain

Christina Stembel clearly remembers the day after California legalized recreational marijuana.

That day in November 2016 was a tipping point for one of the biggest pivots her then-six-year-old startup, Farmgirl Flowers, had made to date.

“The day after the vote went through and it was a ‘yes’ in California, our largest calla lily grower in California took out all of their calla lilies to put in cannabis instead ... to get the soil ready for it,” Stembel said during an interview for Yahoo Finance’s Breakouts series.

“It was pretty immediate,” she said. “And we had to change our entire supply chain in four months, otherwise we wouldn’t have had enough flowers for Valentine’s Day after the vote.”

After the legalization vote, many of the local suppliers she’d once leaned on to provide the flowers that made up her bouquets were suddenly turning to a new crop.

“There’re only so many farms out there in the United States now,” Stembel. “And if they can make $2 a square foot or $1.50 a square foot on cannabis, versus $0.05 or $0.10 on snap dragons, it's a very easy choice for them.”

“I don't blame them for that,” she added. “They're business people as well. But there's definitely a lot of the flower farmers [that] have switched to growing a lot more cannabis and less flowers for that reason alone.”

Read more at Yahoo Finance (Emily McCormick)

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