What’s an extra pound of flower worth to your business?

Right now, cannabis flower prices are dropping all over the country and are at some of their lowest prices ever.

Pounds, ounces, eighths, and even joints have never been cheaper. Which is good news for consumers, but what does this mean for businesses and facility owners?

Why are prices so low?

There are a few factors that can affect the price of cannabis flower. They are:

• The outdoor grow season
• More cultivators as more states legalize
• Quality of buds

Seasonally, the outdoor grow season saturates the market and increases the overall supply of products. Which lowers the overall costs. Historically it works out like this, but it hasn’t taken full effect this year yet. But when it does, we can expect prices to drop further.

Another cause of low bud prices is that as more states open up for business, more cultivation licenses are handed out and there are more cultivators producing. When combined in an area with a solid outdoor grow season, even more product is in stock and circulating. Which affects the price.

Quality is everything when it comes to buds. Weight, aesthetics, smell, and strain all affect the final sales price at the end. Customers will gladly pay extra for high quality, premium buds that look, smell, and taste amazing. Especially for the highly popular strains. Quality buds will always net a higher price.

Facility owners are the ones that suffer

Although cheap buds are great for consumers, is it great for facility owners? Who take on all the risks of the business. They are the ones who:

• Pay the hefty fees to keep up licensing
• Pay the necessary security measures for the facility
• Make monthly lease payments
• Buy growing supplies
• Pay utility bills
• Pay staff
• Be ready for any unforeseen financial setbacks

Facility owners and investors take on all the risk when they decide to go all in and set up a facility. In order to get the greatest return on their investments, they must maximize output and minimize production costs as much as possible.

To maximize production, requires operating the facility efficiently and growing cannabis optimally. Meaning, getting absolutely everything, you possibly can from each plant and light available with as little waste as possible. You also need premium quality flowers to match the high yields. That way you can charge that little extra bit for those large, solid, dense, trichome covered buds.

Is the falling price of cannabis impacting your business? There are 2 things you can do.

1. First thing you can do to off-set the dropping cost of flower is to produce more weight per plant. Especially if you’re producing anything less than 2lbs/light. You’re already invested in growing equipment and consumable growing supplies; doesn’t it make sense to get the most out of those supplies? That way you have more product to sell, and less waste.
2. The other thing you can do is to improve quality. You don’t want to be the one at distribution with the small, light, airy nugs and a little to no nose. That type of flower does exist, it’s out there, we all have seen it. So, we know not every facility is producing amazing premium, top shelf buds.

Yield and quality are always affected when the majority of cultivation variables aren’t controlled properly. Type of nutrition, nutrient doses, feeding schedules, light schedules, and curing are some of the things that aren’t done optimally or are thought to be done “good enough”. When inferior and outdated growing methods are being used, you can definitely count on those methods reducing your company’s overall income and make you burn through precious cash faster than you want.

But come harvest time, this type of management leads to producing average quality yields and nugs. Then the facility owner is stuck with them for longer than necessary or worse, is forced to sell this average harvest at a major loss just to get rid of it. Overall, growing this way lowers the facility’s performance and income.

What if you can increase quality and yields to bullet proof your business in case flower prices get even lower? How about using that extra income to reinvest into your business? What if you could grow an extra pound or two per light? How could that benefit your business? Let’s take a look.

Here’s what missing an extra pound of flower is costing a business.

• The national average price of a pound sells between $800-$1,500. These numbers are based on a lot of factors like location, genetics, supply & demand, quality, and original growing environment.

• Let’s say a facility has 200 lights. Assume it averages 1.5lbs. per light.
• 200 lights @ 1.5 lbs. per light=300 lbs. harvest
• 300 lbs. X $800/ pound=$240,000
• 300 lbs. X $1,500/pound =$450,000

A crop should net anywhere between $240,000-$450,000 every harvest.

Lots of room for improvement. A lot of facilities produce in this area. To get top price for a pound, quality is what you need. More on quality in a bit.

But what if you were able to get 2lbs, 2.5lbs, or 3 lbs. per light. What do those results look like?

Same facility. Same prices of a pound. Same number of lights.

• 200 lights @ 2lbs per light= 400 lbs.
• 400 lbs.=$320,000-$600,000
• The extra half pound per light is a decent raise in income over 1.5 lbs. per light. That can be a minimum of an $80,000 increase from 1.5 pounds per light

Now Let’s see what 2.5 pounds per light looks like

• 200 lights @ 2.5 lbs. per light=500 lbs. harvest
• 500 lbs.=$400,000-$750,000
• The extra pound produced can equate to a $160,000 difference at sales!

Check out 3lbs per light, an extra 1.5 lbs. per light

• 200 lights @ 3lbs per light= 600 lbs. at harvest. Amazing yields, but very few facilities get here.
• 600 lbs.=$480,000-$900,000 every harvest.
• Increase of $240,000 over 1.5 lbs. per light. Yields doubled, so could income.

An extra half pound or full pound is a great improvement in production. It’s a solid boost for earnings. Now how do you aim for the higher end of a price per pound to boost sales as much as possible? Quality is key.

What if you were also able to charge on the higher end of the price of a pound?

We all know what high quality flower looks like. High quality, premium buds is what everyone wants and it’s the key to charging the most for your product. Especially when prices are trending downward. Huge, sticky, pungent, frosty nugs will always get more at sale. But how do you improve the quality of your buds?

When you have the right growing media in place, the correct nutrient doses locked in, optimal lighting, ideal climate, take the time to properly cure, and have a few other important details in place, you create an amazing synergistic environment that your plants can take advantage of to grow to their full potential.

To get there you need an experienced grower who knows how to push plants to their limits. No detail is overlooked, and every cultivation variable dialed in.

Cannabis Optimized can help your facility improve yields and quality. What if you could double your yields and improve quality to dramatically earn more every harvest? It’s time to grow those frosty, heavy, mini tree type nugs that everyone wants.

What’s holding your facility back from producing amazing buds?

If you have the latest climate controls, best lights available, and the strongest nutrients? What’s the problem? It could be the person running the facility and using those inferior methods we mentioned previously.

Have you asked them why the facility’s flowers don’t look like the ones on social media? You know those thick, fluffy, shiny, colorful, and frosted buds that other businesses are proud to showcase?

Ask your lead grower why the facility is producing 1 pound of small buds per light and note their response. If they:

• Don’t know
• Blame it on the genetics
• Blame the growing equipment.
• Blame it on something that just sounds like an excuse

Then these are serious red flags your lead grower is using inferior growing methods and lacks the necessary experience to keep your business running profitably. It may be time to find eminently qualified advisors like Cannabis Optimized to get your facility back on the right track.

Cannabis Optimized can show you how

We’ve rescued rooms, helped facilities with tight budgets, and can help turn any facility around to get them to produce close to 3 lbs. per light. We offer a complete service that can benefit any size facility.

Imagine how profitable your facility would be with the right genetics, an optimal environment, and having an experienced advisor with two decades of cultivation experience to help guide your business to cultivation excellence. How much would that help your business?

If your facility is on a tight budget, and you can’t afford to invest in anything extra at the moment, we’ll always try to get you to grow more with what you do have. A lot of facilities are in this type of situation, and we’re here to help them too.

Interested in our service? Want to learn more? Fill out an application and receive a free 30 min consult.

by Matt Chacon