Strategies to Position a Cultivation Company for Growth and Long-Term Success

marijuana expansion

By Tony C. Dreibus

Marijuana cultivators have a lot to grapple with on a daily basis, from trying to prevent pests that could wipe out their entire crop to constantly calibrating climate control and lighting systems for optimum yields.

So it’s easy to get bogged down in the details without looking at bigger-picture issues that could help fuel growth down the road.

Marijuana Business Daily spoke with several industry experts about how to position a grow for expansion, be it in your local market or in new states that are starting medical marijuana and recreational cannabis programs. Here are some of their top tips.

Create a Brand

Growers often bypass branding, figuring that it’s only beneficial to dispensaries, retail stores and infused products companies.

But it’s becoming increasingly important in some highly competitive markets as cultivation companies look to distinguish themselves from others. Branding is also vital for cultivators that want to expand to multiple states.

Identify what sets you apart from the competition, and make that “your brand DNA,” said Shane Mckee, a co-owner of Rexroad Mckee, the parent company of the Shango line of flowers, concentrates and infused products. Mckee and his partner Brandon Rexroad are currently building out cultivation sites in Nevada and Washington State to go along with their three grows and two dispensaries in the Portland, Oregon, area.

Branding takes a lot of time and work, Mckee said. It isn’t just a matter of coming up with a clever name, logo or motto.

To develop an effective branding strategy, Mckee and co-owner Brandon Rexroad held several brainstorming, or “discovery,” sessions. Executives discussed what they wanted to represent, what was different about the company’s products and the ways its business model differed from others in the industry.

Mckee and Rexroad brought in 22 people from differing age groups, political affiliation and professional backgrounds – some from inside the industry and some from outside of it – to discuss ideas to make their business better.

From this, Mckee and Rexroad came up with a comprehensive branding plan.

Aim for Consistent Output

When people went to the grocery store 100 years ago, they had a limited selection of produce from which to choose. One month they’d have mounds of fresh, red, sweet tomatoes while the next they’d have to settle for lower-quality tomatoes, or none at all.

That changed as technology improved and tomato growers were able to move inside in winter months and continue growing year-round.

The same can be said for cannabis.

It’s no secret that consumers want cannabis 12 months a year, so only making it available at the same time each season – which many cultivators do – isn’t the best business decision, said Brian Humphrey, the president and owner of Sky High Gardens in Seattle.

Before expanding, it’s important to ensure you’re capturing as much business as you can at your current capacity, and part of that means ensuring you have product year-round.

Humphrey has plants at various stages of maturity at his cultivation site in the city, ensuring he’s delivering to customers on a consistent basis.

“Retailers want a constant supply of product,” said Humphrey, who started growing for the medical industry more than two years ago before transitioning to rec in November. “Consider your sales cycle and figure out if you should you harvest several large crops each year of more, smaller crops throughout the year. Consider how this will affect the product that you have available to sell.”

Craft Company Policies, Safety Manuals

Writing a handbook on internal policies, employee guidelines and safety procedures might seem like something only larger companies do, but it’s critical for even smaller businesses – especially cultivation companies that want to open multiple locations and expand into new states.

Having defined processes and rules in place can ensure a smooth expansion, fine-tune operations, ensure consistency and maximize efficiency.

Beware, however, as it’s not an overnight process, Mckee said.

“Shango initially spent four months on this process and we are still refining (our policies),” he said.

Seek Energy Efficiency

Given the huge electricity and water needs of a cultivation operation, it’s important to minimize energy use whenever possible. Doing so can create a leaner business that is sustainable for the long run and can be replicated more cost-effectively in other markets.

Shango has an entire research and development center where it tests out lighting, heating, ventilation, air conditioning systems and air purification methods to find which ones are not only the most environmentally sensitive, but also the least expensive to run.

The company also is working to build a water filtration system, as wastewater from a grow site is full of nitrates and phosphates that sewage-treatment facilities are unable to handle. If the water isn’t properly filtered, it can end up in rivers, lakes and oceans as well as create algae blooms and “other undesirable effects” on the environment, Mckee said.

Focusing on environmentally friendly processes also puts a good face on your business – and the industry as a whole.

“As the industry grows we believe environmental stewardship will be paramount to how our industry is viewed and regulated,” he said. “Preemptively preparing for this during the design build phase will keep your company’s reputation and the environment clean.”

Tony C. Dreibus can be reached at [email protected]

2 comments on “Strategies to Position a Cultivation Company for Growth and Long-Term Success
  1. hmm.. on

    This advice is so outdated already.

    Advice for Sky High – Don’t grow in the middle of the city where rent and utilities are ridiculously expensive….

    Advice for Shango – Don’t grow in warehouses and use non-organic compounds.. you are growing an agricultural product, find handbooks and materials already produced by various organizations, rather than reinventing the wheel.

    Reply

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