The Cannabis Business Times just released its 2020 State of the Cannabis Cultivation Industry Report, and it highlights a gut-punching but critical subject: What makes being in this business so damn hard?
First, some good news. Despite the cannabis industry’s ever-changing rules and regulations, challenges have remained consistent over the last three years (that means more time to focus on the issues and invest in the best solutions).
What are cultivators citing as their most pressing concerns?
According to the report, cultivators face a number of brass-tacks challenges. These are hurdles that have an effect on the end product itself, getting in the way of the nuts and bolts of the craft. Here’s the breakdown:
Insect and pest concerns were most cited by those surveyed, followed by challenges with plant yield and maximizing terpene and cannabinoid content. Other challenges included:
• Humidity control (21%)
• Maintaining consistent yields (19%)
• Finding suitable genetics for growth environment (15%), and
• Weather (13%)
Cultivators also face big-picture obstacles — less-granular challenges that affect their business’s standing in the broader marketplace:
Gaining a competitive edge, ensuring compliance and managing finances topped the list, followed by:
• Securing capital/funding (23%)
• Uncertainty regarding federal law (21%)
• Production costs (20%)
• Marketing/brand building (19%), and
• Product sales (19%)
What can the hemp and CBD industry learn from this?
While hemp and CBD challenges may differ from their THC counterparts, there’s one big link: All roads lead to the pain of siloes, inefficiencies and a lack of visibility. Without consistent management of every moving part of the grind — whether it’s pest control, CBD oil extraction, compliance or finances — work becomes more about reactive firefighting than getting ahead.
Having tech-forward tools can help track and record everything from lab test results, sale tracking, vendor relationships and more. The marketplace presents a range of solutions, but ironically, many are siloed so ensuring a comprehensive feature set is key. (KLER’s platform covers the full operational spectrum — we believe that good data is the lifeblood of business, but it needs to be centralized!)
The upside — and the future
Challenges are ever-present, but a vast majority of cannabis businesses are reporting steady or rising revenue growth and lower production costs. The median cost per pound of dried flower, for example, has decreased by 43% when growing outdoors, 22% for indoor growing and 7% for greenhouse growing.
Cannabis legalization efforts continue to gain momentum, too. Thirty-three states now provide legal medical use and 11 offer legal recreational use. And although the true impact of the COVID-19 pandemic remains unknown, the demand for cannabis is steady and strong, which may suggest that the industry can hold its own despite economic slowdowns.
By the looks of it, the cannabis industry is here for the long haul — so solving its most pressing challenges is critical. It’s a worthwhile pursuit, and it will pay dividends for years to come.