The United States cannabis industry needs a constant influx of product for retail sales and the production of concentrates and edibles. This demand is only expected to keep increasing as new laws are passed that allow more recreational consumers and medical patients to legally obtain and use cannabis.
With this in mind, it’s no wonder that an increasing number of Americans are looking to get into cannabis cultivation. Whether you’re a veteran of the industry or are only now dipping your toe in it, understanding the biggest challenges growers face is key to protecting your investment and ensuring a bountiful harvest.
In the following article, we’ll help cultivators take their operation to the next level by discussing four of the largest cannabis growth challenges and providing guidance on where to obtain essential cannabis banking services for their businesses. Read on.
What are the biggest difficulties for cannabis cultivators?
According to the State of the Cannabis Cultivation Industry Report from Cannabis Business Times, the four largest challenges for cannabis cultivators in 2022 are declining prices and competition, prevention and control of disease and pests, ensuring desired cannabinoid and terpene levels are consistently met, and boosting overall yields.
Another common problem cultivators face that isn’t directly related to cultivation, but is nonetheless an important issue is the difficulty of navigating compliance laws and obtaining the financial services they need to run their business.
Here’s a quick breakdown of these challenges:
1. Insect, pest & disease
Nearly 1 in 3 cannabis growers cite pest, insect, and disease prevention and control as their biggest problem. What’s surprising about this is that over half of these cultivators (54%) are indoor growers.
This indicates that many indoor cultivators need to place a greater emphasis on establishing a safe and clean indoor cultivation environment. It’s in every grower’s best interest to carefully assess their operation and make the required adjustments and investments to address this issue as soon as possible.
2. Achieving target cannabinoid/terpene content
As the industry matures and consumers become more savvy about legal cannabis products, they develop increasingly specific preferences and expectations. Cultivators need to keep up with and even exceed these evolving needs in order to present products that stand out from the competition.
Learning how to consistently “hit the sweet spot” in terpene/cannabinoid content will likely require extensive research, experimentation, and strategic thinking on the part of the cultivator, but the ones who manage to do it will reap the benefits for years to come.
3. Ensuring greater yields
The global delays and shortages in the supply chain caused by the COVID-19 pandemic have impacted many industries, and cannabis cultivation is no exception. With crucial supplies such as perlite, coco, and peat becoming harder to come by, increasing yields without significantly boosting expenses has become a major challenge for growers.
The only way to alleviate this problem and ensure more favorable yields is to think out of the box, optimize existing processes, and adapt to the current situation as best as possible. Cultivators who are able to do this will not only enjoy greater yields in the short-term, but are also likely to increase their long-term Return on Investment (ROI).
4. Competition & declining prices
As the cannabis industry grows and the legal market becomes more open, prices are expected to decline even as competition grows. Cultivators will have to increasingly optimize their expenses and processes to ensure higher quality and yield, and learn how to ask the right questions and identify inputs that ensure the highest ROI.
5. Obtaining financial services
Despite the passing of the SAFE Banking Act 2021, which enables financial institutions to take on cannabis business clients without fear of sanctions, many cannabis cultivators still find it difficult to get the financial services they require.
Luckily, there are now specialized financial institutions that help cannabis cultivators ensure legal compliance and obtain access to quick payment processing and affordable banking services.
Who offers support with cannabis banking services to cultivators & other operators?
Confia provides cannabis cultivators and other operators with effective financial solutions that include the complete range of advisory and banking services. Whether you need assistance in navigating obstacles such as ensuring compliance for cannabis cultivation, setting up a secure and intuitive consumer payments system, or gaining access to funding, we’re the ones to call.
Reach out to us to learn more about our membership options and kickstart a partnership that will help you drive your business to success.