Greg Sanders: Yes, I’m going to keep it kind of basic for you, Eric. We’re seeing anywhere from 40% to 50% average within our proprietary brands. You will see the highest margins coming out of the Harvest Company. And usually the lowest margins you’ll see coming out of our ion brand which is a lighting brands, and are nutrients and cocoa chocolate brands fall somewhere in between. That’s very Helpful. All right, that’s very helpful. And then
Eric Des Lauriers: I’m wondering if you can comment a bit on some of the difference in dynamics between eCommerce revenues and brick-and-mortar, you called out eCommerce comps that sort of masking the positive same-store sales growth that you saw at retail. I’m just wondering, how the sort of demand dynamics within those channels differ. And maybe how to think about those going forward as you are investing more in B2B.
Darren Lampert: I think as you see the cannabis space turning more B2B than B2C. And what we’ve seen with our eCommerce division, is some of our larger customers that started out in the ecom division, have switched over to a commercial team in some of our stores where they get white glove service where they’re looking for credit. They’re looking for account reps with more skills, as opposed to just going on websites and buying. So it’s not that our ecom division has been slow. It’s just again, it’s just a mix of business its much smaller. And again, a lot of our largest customers that were — that did come in through ecom, that shopped on ecom have changed over to a different division of GrowGen. We have definitely pulled back expenses.
On our ecom division, we pulled back on advertising, a lot of it is very price sensitive opposed to service sensitive. So again, we will continue to monitor. We are starting to open up some B2b portals for our proprietary brands, which will go through the ecom division, which should help drive sales through that division.
Eric Des Lauriers: All right, great. Thanks for taking my questions.
Operator: Thank you. The next question comes from Mark Smith from Lake Street. Please go ahead.
Mark Smith: I guess, I wanted to ask for — just about inventory, came up just a little bit here, but looks good year-over-year. Just give us your thoughts around comfort levels, and kind of the quality of your inventory today.
Darren Lampert: Greg, I’m going to send that over to you.
Greg Sanders: Yes, yes. Hey, Mark. Today, we reported inventory at $66 million for the first quarter, which was up just incrementally to the fourth quarter, primarily due to Q2 sales demand as we look at things. As we get through the year, we see opportunities to continue to take down inventory throughout the course of the year. I mean, that might be 5 or 10, when you’re working through, more optimized model on the inventory side of things as we progress throughout the year. But we want to make sure we have the right inventory in the right locations for Q2, which is from a seasonality perspective, our best performing quarter. So that’s a little bit around inventory. And to the quality of the inventory, we still have decent reserves on what we have in place. We feel very, very comfortable with what we have from a quality standpoint and a mix perspective.
Mark Smith: Perfect. And then second, just big picture. Darren, just as we think about getting capital allocation, you’ve got a good balance sheet with the cash here. How you’re kind of way and think about investing back into business, in stores or brands versus share repurchases, or potentially acquisitions. Walk us through kind of how you think about capital allocation today.
Darren Lampert: Yes, I think I started off when I went to want to answer the question from Brian Nagel, but we’d go over it again. There’s five different buckets that we look at right now, especially for 2024 as we go into to 2025. And it’s mostly organic, it’s investing in grow, Jenna posted growth, investing outside of [indiscernible]. In our first bucket is investing in the business. That’s our supply chain, distribution, where we just built out 100,000 square feet in Ohio. And we’re just in the midst of also building a B2B portals for our proprietary brands so people can go online and purchase on different portals. Secondly, we’re investing in proprietary brands, launches, as you saw the private label went from 18.6 last year, up to 22.6 this year.
We have 350 — over 300 active trials right now a Drip, they’ve given out over a quarter of a million dollars of product last quarter for our Drip launches. Also, we have a full team of sales people for Drip right now. We’re also investing in new products coming out of [indiscernible], some we believe will be the IGC world and also new products coming out of power assign a harvest company. The GrowGeneration spending an enormous amount of money on these product launches, developing new products that we believe will be the future and grow jet. Thirdly, we’re investing in our customers we’ve increased credit to a number of our customers right now. They’re starting to investor certain build outs for our customers. We are opening up credit as we see the industry starting to churn.
And we believe the days waking up and the side as we want to become [indiscernible]. The individuals that have made it through the harder parts of this market, but the last four years. We believe we are going to be here for a long time to come and be wonderful customers of GrowGen. And we are starting to open up credit at GrowGen, and bringing in new customers and also helping old customers. We’re also investing in GrowGen. We just announced the $6 million share repurchase that started on April 1. We will update Wall Street in our second quarter to second quarter event. But we have been in the market buying back stock. And with that, we are always looking at acquisitions. Again, if we find something that we believe is accretive, and in the best interest of our shareholders, we will take a hard look at it.
And if it’s going to work for GrowGen we’re a buyer. So we are always reviewing different products, stores out there, and looking what’s in the best interest of GrowGen. So it’s a five step process that we are looking at on a daily basis.
Mark Smith: Excellent. Thank you.
Operator: Thank you. [Operator Instructions] Next question comes from Aaron Grey at Alliance Global. Please go ahead.
Remington Smith: Hi, good evening, and thank you for the questions. This is Remy Smith on for it and Greg. So my first question, can you provide commentary on how to accuse looking quarter-to-date. I know it’s historically been a strong quarter for you guys. So any color, and if you’re seeing a typical seasonal benefit would be helpful. Thank you.
