According to a recent survey published in MJ Biz Daily, most growers believe that quality of their flower is the most important factor in selling their product. But that’s not what the buyers of wholesale cannabis are acting on–they want the cheapest price for the most potency. What’s the disconnect?
As the market for cannabis use expands, you can expect to see marijuana brownies in your supermarket next to the DingDongs. Hey, maybe even Marijuana DingDongs–why not? But that means high volumes of low-priced cannabis and that favors the big growers. Their main selling point to the Marijuana DingDong Company: high potency flower at low low prices.
So how does the small grower stay alive in this environment? One answer is Get Bigger or Get Out. That’s certainly what a lot of small growers have done in Oregon and Humboldt County and places where supply far exceeds demand. Since most of them lack the capital (i.e. money and know-how) to expand into the bigtime market, they have switched to providing other farm produce where they can get a premium for quality, organically grown herbs and veggies.
The other answer, for those who want to stay in the marijuana business is Grow Organic and Grow Your Brand. As MJ Biz Daily puts it “Value-added cultivation – such as sustainable and organic production – could emerge as a key segment similar to the food industry.” The days of the small grower may be numbered in the face of competition from the Marijuana DingDong factories and Marijuana Supermarkets and the giant tobacco-beer-marijuana conglomerates that will be more than happy to sell the cheapest, high-potency cannabis they can grow. Unless you can create a brand for your flower than will give you a niche in the industry, much like high-quality niche products in the food industry (think extra-virgin organic olive oil or organic grassfed beef, as examples.)
The small grower with the reputation for high quality may not be the biggest player in the market, but maybe that is good enough.
The article in Marijuana Business Daily is by Eli McVey. It is well worth a quick read-through.