A strategic advantage is something that a company has—be it a product, process, idea or combination thereof—that enables it to stand out amongst the competition and, potentially, stake claim on a market niche. In a time when competition is fierce, especially in the well-established West Coast cannabis markets, any tool you can use to distinguish yourself from your peers is going to help your bottom line.
Here is a breakdown of wide-ranging advantages that may help a company define itself and remain relevant in an ever-expanding marketplace.
1. Access to Exclusive Cultivars
Having quality cultivars that are desirable and exclusive to your company is a clear advantage. Look at it this way: There are certainly ubiquitous cultivars that customers demand that many companies must supply, but if a cultivation business or retailer has access to the same cultivars as every other company, little incentive exists–outside of quality, production costs and selling price–to patronize that particular business/brand over another.
Having exclusive and superior genetics, or, better yet, breeding them in-house and never releasing them as seed or clone to the public, potentially makes those genetics patentable. This can be a strategic advantage in and of itself: If patented, the cultivars can then legally be licensed to companies in non-competing geographic locations.
Alternatively, a cultivator may choose to license exclusive genetics from a particular breeding company, similar to how today’s traditional ornamental plant industry operates.
In a time when competition is fierce ... any tool you can use to distinguish yourself from your peers is going to help your bottom line.
2. Proprietary Products
Beyond genetics, having proprietary products and/or securing intellectual property (IP) can be a game-changer for a company. Patenting cannabis-based formulations, for example, is another way of standing out. If a patent or other IP mechanism isn’t an option, that formulation still can be kept as a trade secret not to be shared with anyone outside the company.
If your company is not in a position to develop its own proprietary products, establishing exclusive partnerships with other brands can help you gain access to those products. Many cannabis companies have successfully established themselves as a go-to for specific processed products and/or brands, and those products may only be produced by or purchased from those regional partners.
Beyond the blend of food ingredients (which can offer another strategic advantage if you’re targeting people with dietary restrictions), the cannabinoid and terpene blends created in different products can be trade secrets, whether they are water-soluble cannabinoids, bio-available cannabinoids, specific terpene formulations (in combination with cannabinoids) or the compounds used as flavor ingredients.
3. Efficient Cultivation and Extraction Methods
Drip or automated irrigation, conveyor belts, mechanical potting and seed-planting systems should be employed in any large-scale cultivation facility (if it’s within financial and logistical reason). Any possibilities of using geothermal, hot wastewater (where heat is recovered from hot exhaust gases, hot cooling water or other heat-filled waste) or any other energy-saving, eco-friendly practices can be beneficial both as cost-cutting and strategic advantage tools.
Make sure your processes match your desired output to ensure you are running a lean operation.
Extraction methods and processes must be at the height of efficiency as well, which begins at the time of harvest. Make sure your processes match your desired output to ensure you are running a lean operation. For example, if you’re looking to preserve all available terpenes, it is preferable to extract from fresh-frozen cannabis. To target specific compounds such as CBD and leave out terpenes, it is preferable to dry before extracting.
Whichever method is chosen, it must be performed efficiently, which means as automated as possible with minimal labor. The goal is to create a superior product that sells for a superior price at a lower cost.
The more remote the company is, the farther it is from the market/customer, which means more transportation costs to ship and receive supplies. Being close to your primary materials or supply outlets is something everyone needs to consider in their business plan. Getting specialized materials to remote locations can be problematic, and any delivery delay can be deeply disruptive to your business.
Choosing a location that keeps you near your customers and suppliers will lead to savings that will position you to remain competitive in the marketplace.
5. Recognized Logo/Branding
When choosing a company name and logo, consider customer perception a priority. Who is your company’s target customer? Is it a young millennial demographic? Does it include business professionals? Seniors? It is always best to keep your intended customer in mind when developing your company name, logo and branding, as well as when you are establishing partnerships with other companies, social media influencers and advertising companies.
Having quality cultivars that are desirable and exclusive to your company is a clear advantage.
Also, avoid parodying another company’s name, logo or brand character likeness. While it might catch your target audience’s eye or get you some social media play, it most likely will land you in a lot of trouble. The short-term success of doing so will not be worth the long-term costs.
6. Strive to Employ Advanced Technologies
Whenever possible, strive to be a leader, not a follower—and be the first to innovate. Successful companies continually investigate the research and development of new advanced technologies whenever fiscally wise. Successful cannabis companies are continually aware of current market trends, especially with regard to extracts and extraction technology. Many companies are rapidly developing superior equipment and technologies for both small-scale and very large-scale extraction utilizing a multitude of methods, all with an eye on efficiency and superior-quality production. As industrial hemp production comes into play with the passing of the 2018 Farm Bill, I expect to see industrial scale of CBD isolation on a never-before-seen level, which will in turn encourage development of CBD refineries to extract the targeted compound as efficiently as possible.
7. Social Media Presence and Company Affiliations
Companies recognize the power of social media in creating a positive company image. What can be overlooked is that a decade of hard work can be destroyed in seconds with one misguided post. Unless being edgy and controversial is part of your company’s identity, avoid putting off a significant portion of consumers with off-color or irrelevant posts. Don’t post comments or opinions that may anger or offend your customer base. Instead, stick to what you’ve identified as your target audience’s interests. Does your brand project a healthy lifestyle with posts of relaxing situations? Is it for yoga enthusiasts? Are you targeting nature-lovers, or is your focus primarily on action and sports and those who engage in them? Regardless of what it is, maintain your focus, corner your niche and develop a dedicated following.
8. Management Team and Surrounding Team Members
It is undeniable that a company is judged by the behaviors of its ownership and management team, so prepare to have your every affiliation and behavior during both work and off-work hours scrutinized. Whether we like it or not, we often are judged by the company we keep and sometimes we are deemed guilty by association. This can be a positive when surrounded by the best, and a curse when partners fail to meet your standards. The most successful companies surround themselves with the best in their designated field and act accordingly as a representative of the company for which they work. Executives embroiled in scandal or lawsuits, or who have less than transparent relationships with other related companies, can ultimately hurt your entire organization. A quality and reputable team should most definitely be considered a strategic advantage, to say the least.
Getting specialized materials from remote locations can be problematic, and any delivery delay can be deeply disruptive to your business.
9. Community Relationships
A positive relationship with your community is a clear strategic advantage in that customers can choose (and feel good about) where they spend their hard-earned dollars. What is your company’s reputation in your local community? Is it known to interact and engage in voluntary services or philanthropy? Do you support your neighborhood as a responsible business owner should? Don’t brag about your contributions and appear boisterous or brash, but let customers know about your passion and how their transactions directly help their community.
Making sure that you use every advantage you can come up with is a surefire way to ensure that you positively stand out from your competition and ultimately find long-term success.
Kenneth Morrow is an author, consultant and owner of Trichome Technologies™. Facebook: TrichomeTechnologies Instagram: Trichome Technologies k.trichometechnologies @gmail.com
Each year, new products and technologies come to market that can help commercial cannabis growers speed plant growth, improve yields and decrease production costs. Immediate changes to the grow environment, however, can place a crop at risk, and improperly introducing new products into your cultivation program can result in missed deadlines, damaged plants and even crop failure.
Improperly introducing new products into your cultivation program can result in missed deadlines, damaged plants and even crop failure.
New cultivation materials should be cautiously introduced into the grow environment, and preferably trialed on a small scale first. Not only does this make good grow sense, but it is a fundamental tenet of Good Manufacturing Practices (GMPs). GMP-compliant growers follow very strict guidelines when it comes to changing cultivation practices or introducing new materials into production.
The following guidelines can help ensure that your next cultivation purchase is a blessing to your operation, not a curse.
Growers frequently experience plant issues as the result of introducing new fertilizers into their cultivation program. Most operations use fertilizer with each irrigation, and it’s applied to thousands of plants at once. If a new fertilizer is mixed incorrectly, or reacts poorly with the grower’s substrate, plant problems can manifest themselves in the form of burned leaves, discolored pistils or dead roots.
For hydroponic growers, switching out premixed hydro-shop nutrients for a different brand can be risky. Mineral ratios will differ between brands, and some plant additives are not required to be listed on the product label. For organic growers, new liquid fertilizers or compost teas can be risky as well because it can be difficult to guarantee the consistency of ingredients in these mixes. Compost teas that aren’t properly brewed can negatively affect plant health, and even properly prepared liquid organic fertilizers have a short shelf life.
The correct way to introduce a change to your fertilizer regime is by first trialing the new product on a small portion of your crop. For new hydroponic formulas, make sure to follow the label and test the final solution with an electrical conductivity (EC) pen. For new organic fertilizers, be aware of the product’s expiration date and discard the product if not used before then. In both cases, if the fertilizer is purchased in large volumes, it is a good idea to perform a solution analysis on each lot prior to use.
Cultivators may want to change their growing media to decrease production costs, but a dramatic change in substrate composition can catch cultivation teams off guard. For example, when plants have fertility issues due to a growing media switch, growers must rethink their fertility and watering programs. The setback can cause slow plant growth and missed production deadlines.
When using coconut products (coir, fiber, etc.) the potassium, sodium and chloride content can vary drastically between brands. Some manufacturers/suppliers triple-wash and pH-buffer their products to remove salts and provide for better nutrient uptake, yet others skip this step, and growers must adjust their plant nutrition protocol to account for the higher salt content.
When plants have fertility issues due to a growing media switch, growers must rethink their fertility and watering programs.
Most organic growing media components are not composted, but if a composted material is being used, it needs to be properly “cooked” during the compost stage, meaning the microorganisms in the compost must be given time to break down the raw material (in a process that naturally creates heat as a byproduct); uncooked or poorly prepared compost can burn plant roots and shoots. Different raw materials affect nutrient availability in an organic mix, so growers will need to adjust their watering and fertility programs to find a proper balance.
A media analysis can help provide information like high salt content or unfavorable pH values at the outset, and the risks inherent to introducing new growing media can be mitigated by selecting a reputable supplier to work with that can formulate the proper media mix for your operation. Proper media formulations will guarantee optimal/desired physical properties (porosity, air, water, etc.) essential for crop management.
If feasible, it is also helpful to perform a small trial of one complete crop cycle prior to switching over the entire operation.
The temptation to upgrade to new lights is very compelling, and with good reason. Today’s horticultural grow lights provide more power, use less electricity, and some even enable growers to customize light spectrums to encourage cannabinoid production. However, if you don’t slowly introduce your plants to a new light source, you’re likely to encounter problems.
Whether you’re going from 600-watt high-pressure sodium (HPS) to 1,000-watt HPS), or HPS to light-emitting diode (LED), you need to trial these products before implementing them on a large scale. For indoor growers, moving from a lower-wattage HPS to a higher-wattage HPS could overwhelm the HVAC system and cause heat burn to the plants. On the flip side, some growers are so delighted with the low heat output of LEDs that they place the plants too close, and as a result experience crop bleaching—the plants could literally grow white buds.
If you are thinking of upgrading to stronger lights, make sure your HVAC system can handle the increase.
Even if the supplier swears you won’t have any problem incorporating its new lights into your grow, or you know of industry colleagues that have seamlessly made the transition, it is still your responsibility as the grower to minimize potential damage to the crop by testing these lights first. If you are thinking of upgrading to stronger lights, make sure your HVAC system can handle the increase. If possible, establish plants at a greater distance from the light than is recommended by the manufacturer, and slowly bring the lights closer over the next five to seven days. If light height is fixed, try dialing back light intensity, or use fewer lamps initially and slowly build up to full strength. If no negative effects are evident after one week, it should be safe to introduce the lights to the entire crop. Still, play it safe and slowly introduce your entire crop to your new light setup.
Aeroponics and deep water culture (DWC) are advanced forms of hydroponics that use no substrate at all. Plant roots are either suspended in air and misted with nutrient solution, or they are bathed in constantly flowing oxygenated water. Switching to these cultivation methods can appeal to growers because the systems use less water, grow plants more quickly and avoid the risk of soil-borne diseases.
Although the advantages may be obvious, moving from substrate growing to aeroponics or DWC is a huge jump. These systems demand tight control over water temperature and dissolved oxygen levels, and there are a near infinite number of spray nozzles and tube junctions that could clog, leak or rupture. Equipment and systems need to run in perfect unison, and they can be especially risky for start-ups because they are more prone to unexpected interruptions in power supply.
The best growers establish their toolkits of new pest control products before they need to use them.
Growers interested in evolving their programs in this direction should consider setting up a research and development (R&D) station to trial these systems first. Get used to the increased vigilance of new equipment and all the intricacies of running these ultra-high-tech hydroponic systems. After a few mini-crop cycles, the grower can decide if this upgrade makes sense to incorporate over several thousand square feet of cultivation. (Editor’s note: For more information on these hydroponic systems, see the article “Are You Well Versed in Hydroponics? Part II” in the March 2019 issue of CBT.)
Pest Control Products
A common misconception is that organic pesticides and fungicides are not as effective as their chemical counterparts, and as such, the introduction of new organic products are safe in any amount. Unfortunately, many growers find out the hard way that this is simply not true. I have repeatedly witnessed plant damage that was the result of using all-natural pest remedies, such as neem oil. Although 100-percent organic, if neem oil is applied at a high rate, or to dry plants, or in the heat of the mid-day sun, plants are likely to suffer.
The best growers establish their toolkits of new pest control products before they need to use them. This is because most spray applications are done urgently, when pest or disease pressure is severe, and the grower doesn’t have time to perform plant compatibility tests. The only thing worse than having a severe insect outbreak on your crop is to further aggravate plant problems with the use of a non-compatible pesticide.
Trials only need to involve a few plants, but they should be representative of the entire crop. Plants should be in good health and recently irrigated, and the spray application should occur in the early morning or late afternoon in a greenhouse, or under reduced light if indoors. Application rates are stated in ranges on the product label, so start at the low end of that range. If after 72 hours no phytotoxicity is evident, the product should be safe to apply in the same manner to the rest of the crop. If phytotoxicity does occur, trial the same product again at half strength or replace it with different product and begin the trial again.
Ryan Douglas is the owner of Ryan Douglas Cultivation, LLC. He has worked in commercial horticulture for 20 years and specializes in legal cannabis start-ups.
Brian MacIver: How has Panacea Valley Gardens changed from its beginnings as a 4,000-square-foot horse barn retrofit and 8,000 square feet of hoophouse space?
Jesce Horton: Unfortunately, during the regulatory changes in Oregon, Panacea Valley Gardens had to close at the end of 2017. Our property was at the edge of what is considered National Scenic Land, which was too close a designation to Federal Land for the state to allow us to continue operation.
BM: What is the status of Saints Cloud, your Portland cannabis culture hub project?
JH: The closing of Panacea Valley Gardens was a major blow financially, and we had to suddenly shift gears from the multi-million-dollar development property, Saints Cloud, to opening a smaller cultivation facility first. “Lil Saints” as we call it, an 8,000-square-foot Tier I facility, has just entered full-scale production, and we are now back to development of the Cloud. We plan to open the first phase of Saints Cloud in the summer of this year.
Lil Saints is actually just 2.5 miles down the road from Saints Cloud, in Northeast Portland, Ore. The official name of the business is “Saints’ Cannabis.”
BM: Resource efficiency is one of your core values. What new methods and/or technologies have you developed or discovered in the past two years that helped you be more efficient?
JH: We are always increasing levels of monitoring and reporting in cultivation environments and implementing a Variable Refrigerant Flow system in appropriate applications. Variable refrigerant flow (VRF) systems vary the flow of refrigerant to indoor units based on demand. This ability to control the amount of refrigerant that is provided to fan coil units located throughout a building makes the VRF technology ideal for applications with varying loads or where zoning is required. In addition to providing superior comfort, VRF systems offer design flexibility, energy savings/energy incentives and cost-effective installation. Additionally, we are working with leading organizations like the Resource Innovation Institute on efficiency tools like their newly released PowerScore.
BM: Over the past two years, many states have offered opportunities for minorities to join the cannabis industry through criminal record expungements, reduced application fees and other programs. What do you think of those efforts, and what remains to be done to keep advancing racial equity in the cannabis industry?
JH: I commend the efforts being made across the country and the industry leaders who are driving the progress. As the industry evolves, it is exceedingly important to ensure these minority-owned businesses can scale by making capital available through programs like NuLeaf Project, a historic industry grant program in Portland, Ore., directed by my wife, Jeannette Ward Horton.
BM: You describe yourself as a craft cannabis grower. What tips can you offer other small-scale and craft growers to survive in a market glut like the current one in Oregon?
JH: Focus on being the best cultivator possible and on bringing something unique to the market. Sell on value, not on price, and there will always be a place for you in the market.
Editor’s note: This interview has been edited for style, length and clarity.
Despite the remarkable scientific and social progress we’ve seen with cannabis in recent years, the language we use to discuss its vast and varied effects is still stuck in the past. In some ways, this disconnect between common vernacular and scientific discovery is understandable. Cannabis is uniquely complex. It defies the narrow scope of conventional “single compound, single target” pharmacology. Yet the task of resetting the language of cannabis is vital. Learning to analyze, interpret and intelligently discuss this botanical powerhouse will help ensure better experiences for longtime users and newcomers alike.
Farma, a dispensary in Portland, Ore., has proven this process can be done on a small scale. Grounded in the work of the renowned neurologist and cannabis research pioneer Dr. Ethan Russo, Farma is one dispensary paving the way to cannabis curation according to chemical composition rather than plant morphology. By aggregating and analyzing reliable lab data-that is, by focusing on chemotypes rather than folklore and strain names-dispensaries can help guide patients and consumers through a spectrum of effects that more effectively target specific needs and desired experiences.
Sound Data Begets Sound Analysis
The process of analysis begins with ensuring safe access. In Oregon, this means partnering with independent, state-accredited labs capable of testing for more than potency and primary cannabinoid content, but the full spectrum of active compounds. Other states, such as California, are in the process of developing their own testing protocols.
Without solid lab data from the start, we cannot hope to generate reliable resources and experiential predictions that help folks form a lasting, positive relationship with the plant.
Curating with Chemotypes
Not everyone coming through the doors of a dispensary will have had a pleasant experience with cannabis. Maybe this is their first time; maybe they’re gun-shy after an encounter with a strong edible; maybe they’re coming for symptomatic relief without losing clarity and functionality. But that scent! It gets them every time. It is as intoxicating as it is calming, akin to some sort of urban forest bathing experience. Yet that comforting scent belies a surprising truth: the nose knows. And it is one of our greatest tools for understanding how cannabis will interact with our individual endocannabinoid systems. (For this reason, dispensaries would benefit from allowing consumers to smell and examine the product they’re buying. Pre-packaged and sealed flower is antithetical to informed consumer judgment.)
Researchers like Dr. Russo have shown how cannabinoids and those delicious scent compounds, terpenoids, work in tandem to create, mitigate and modulate our individual responses to cannabis consumption. This is commonly known as the “Entourage Effect.” This poly-pharmaceutical phenomenon suggests that the way we experience cannabis is dictated not by the plant’s morphology (indica or sativa) or even one or two isolated compounds, but through a myriad of molecules working in conjunction with one another.
The key, then, is knowing how all these active compounds-but particularly cannabinoids and terpenes-interact with our bodies. To this end, it is imperative that we generate complete and detailed lab reports with each harvest.
Using this data, consumers will no longer have to rely solely on the strain name when trying to ascertain effects-which is particularly ineffectual when it comes to proprietary chemovars, as there is little basis for comparison.
But what about those good-old standbys like Blue Dream? Is it not possible to make accurate predictions about these stalwarts? The answer, unfortunately, is no. That’s because, phyto-chemically speaking, one batch of Blue Dream will never be exactly the same as another. Depending on the genetic stock, the methods and the environment in which it was grown, even well-known cultivars can show significant swings in phyto-chemistry from harvest to harvest. For instance, one batch might be myrcene-dominant and thus a bit “stonier,” while another is much more focused and peaceful with a higher pinene concentration. A predicted effect comes from the weighing of all these tested compounds against one another to see which way the scale may tip.
In practice, this complexity can be daunting. Is a customer looking for appetite suppression? Perhaps they should try something high in THCV, humulene or a high-limonene/CBD combo. Pain relief? Myrcene and linalool are both known for their analgesic properties. Anxiety? CBD, for sure, but also CBG, CBC, pinene, and beta-caryophyllene, the only aromatic compounds to work similarly to CBD by helping to mitigate a negative THC response. Compounds should not be thought of independently of one another. Research has shown, for example, that when beta-caryophyllene and humulene are found together in high concentrations, anti-proliferative activity soars, inhibiting certain types of cancer cell growth. The combinations are endless, because this plant is so tremendously multifaceted.
Few would dispute that cannabis science is evolving, and we still have much to learn. But that should not keep us, as the face of the industry, from striving to responsibly parse the data that we have at our disposal. The effort is worth it. There is no better feeling than knowing that you positively helped redefine someone’s relationship with cannabis, to hear how your careful recommendation met or even exceeded their expectations.
To a degree, and likely unacceptable in any other industry, cannabis consumers have to take dispensaries at their word about the cultivars they carry. Does this Durban Poison possess true Durban genetics? Until now, there was no way to decisively know the answer. Buyers were forced to take the name on the jar at face value. Genotype certification changes that.
Phylos Bioscience here in Portland has revolutionized consumer reliability and grower reproducibility with the introduction of a certification system that ensures genetic identity. Through DNA sequencing, consumers can more accurately infer similar effects. Farma is proud to have been chosen as the first dispensary to bring that data to customers.
With the help of growers and breeders from around the world, tens of thousands of genetic samples have already been collected and placed within the Phylos Galaxy-an interactive, three-dimensional web that enables users to visualize the world of cannabis cultivars and how they relate to one another. Because Phylos works strictly with DNA from stems, samples can be collected from anywhere in the world, providing growers with the ability to not only protect proprietary cultivars, but also fine-tune genetics and cultivation methods. Further, the transparency provided by the Galaxy builds trust with consumers and better informs purchasing decisions.We are in an exciting and dynamic period in the evolution of cannabis. The truth is, though, a lot of misinformation is out there, much of it steeped so deeply into cannabis and mainstream cultures that we have no choice but to work with it. The flawed, but familiar indica/sativa/hybrid taxonomy is here to stay for the foreseeable future. That said, people generally trust scientific data, especially when it is consciously cultivated and actively made approachable.
As the customer-facing side of this industry, it is our responsibility to erase the legacy of generations of prohibition and propaganda with a new, more evidence-based paradigm. By arming growers and budtenders with the resources they need to engage effectively and confidently with even the most hesitant of customers, together we can reframe the entire conversation around cannabis.
This column originally appeared in the February issue of Cannabis Business Times' sister publication Cannabis Dispensary.
Andrea Sparr-Jaswa is the co-director of education and outreach at Farma in Portland, Ore., where she is responsible for aggregating and analyzing customer-facing data.
Cannabis Business Times’ interactive legislative map is another tool to help cultivators quickly navigate state cannabis laws and find news relevant to their markets. View More