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TAAT Lifestyle & Wellness gets first order for UK distribution of Beyond Tobacco

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TAAT Lifestyle & Wellness (CSE:TAAT/OTCQX:TOBAF/FRA: 2TP2) is on a roll at the moment, with the news that it has appointed its UK distributor, Green Global Earth. This follows hard on the heels of its appointment of a Canadian distributor.

TAAT’s proprietary Beyond Tobacco material is what gets us excited about the company – a material that looks and smells and tastes like tobacco but has no addictive qualities. TAAT is positioning it as the global solution for those who want to give up smoking.

TAAT reports that the deal with Green Global Earth will cover both the UK and Ireland. It has made no secret of its international ambitions, but its core strategy has been to focus on the US, where it has already enjoyed a successful roll-out in Ohio and is implementing a US national digital strategy.

TAAT’s first distribution venture outside North America

UK and Ireland represent TAAT’s first venture outside North America and the company is aware of the heavy duties that exist in Europe on tobacco. The price point of TAAT compared to traditional tobacco cigarettes in these countries could represent a competitive advantage in these markets.

Based on 2018 data from the World Health Organization, the prices of the most sold brand of cigarettes (standardized to a pack of 20) in international dollars (purchasing power parity adjusted) were $13.581 and $14.952 in the United Kingdom and Ireland (respectively), compared to $6.863 in the United States. With a 14.1% tobacco use incidence rate among the UK’s legal-aged population and an incidence rate of approximately 20% among adults in Ireland, TAAT believes there is ample opportunity for Beyond Tobacco to establish a position in these markets.

At the outset, TAAT will ship domestically manufactured inventory from the United States to fulfil the current purchase order from GGE, as well as any potential future orders from GGE to the UK or Ireland in the near term. At a later date, GGE may avail its supply of raw materials and undertake manufacturing of TAAT on its behalf in markets in which GGE would operate under a “licensed” production and distribution agreement.

But TAAT is also approaching the UK cautiously: “Expansion launches in the CPG category need to be conducted passively, so as to ensure the product is optimally positioned in its new markets,” said Setti Coscarella, CEO of TAAT. “Although we believe TAAT is generally relevant to those out of the more than one billion tobacco users worldwide who aspire to leave nicotine behind, entering a new region is a complex task based on the nuances of each market in economic and competitive terms, as well as the general attitudes towards alternatives to products such as tobacco cigarettes.”

Podcast with Joe Deighan, Founder and Director of Research, TAAT Lifestyle and Wellness

TAAT expands facilities and manufacturing capacity in Las Vegas

TAT also confirmed last week that it is scaling up its physical presence in Nevada with two new facilities in the Hughes Airport business park near McCarran International Airport. This represents over 2600 square metres which will be used for manufacturing, warehousing, distribution management and office space for executives.

The new space will enable TAAT to significantly upscale its existing production of Beyond Tobacco – it represents an expansion of 250% in available space. The company also says the new space will allow it to form division to support global distribution partners.

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This article does not constitute investment advice. Do your own research or consult a professional advisor.

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