It’s well known in the industry that we’re in a “race to the bottom” to produce a pound of cannabis as inexpensively as possible. On the one hand, it makes good business sense.
However, if you look to cut costs above all else, you’re going to run into issues that can jeopardize crops — ballooning your overhead, creating public relations headaches, risking important relationships with processors and retailers or even endangering consumers.
Race to the bottom, indeed.
But when you start with clear business goals for your operation and avoid common pitfalls as you design and build your cultivation facility, you’ll set yourself up to succeed where others fall behind.
Getting Started
If you grow it, they will come, right? Nope, not in this crowded industry. Establishing your facility’s precise goals from the outset is key. And from those goals, all else flows. Goal-setting is linked to better performance and can help you establish — and thrive in — your niche as well as inform the best layout for your facility.
Are you a vertically integrated business and need extra grow space for an operational scale-up? Growing flower specifically to sell to an extraction company? Working to develop hyper-specialized or premium strains? The layout, number of lights, irrigation needs and more will all be developed based on your business goals.
I’d argue that just as important as the design is the overall health of your facility. As a project manager who’s handled build-outs and retrofits in more than a dozen states at this point, I’ve worked with owners who have just signed a years-long lease on a warehouse only to discover that they’ve got a serious mold problem on their hands or the space can’t support a sufficient HVAC system. At this point, my list of what not to do is about three times as long as the list of what it takes to be successful.
Whether you’re in an emerging market like New Jersey or an established market like Colorado, there’s a reason to start with the basics: Success and profitability come from the time spent doing your due diligence at the beginning of the project — not in mitigating foreseeable issues after they’ve wreaked havoc on your operations.
Five Common Pitfalls
1. HVAC Headaches and Irrigation Aggravations
Every square inch of your new or existing facility needs to be under a microscope before a buildout or expansion. Tedious though they may feel, the hours you spend now will translate into weeks or months of time saved down the line and many avoidable expenses.
I’ll give you an example: I worked with a cultivator in the Las Vegas area who built out his entire facility and went with a seemingly trustworthy engineering outfit to design the HVAC system. Well, it turned out that this facility’s air conditioning capacity was only at about 10% of what it needed to be — a big problem in the desert. Once this client realized the issue, he was stuck with spending more than $4 million cutting into precast concrete walls and expanding his AC capabilities — after he already had plants in the facility. So he faced the double whammy of facility retrofitting while trying to avoid crop loss.
I had another client whose growers were sure that each plant was taking about a gallon and a half of water every day, when in reality, it was closer to a half-gallon. That may not sound like a huge difference, but engineers on the job designed a robust irrigation system built to transport about three times the amount of water needed — significantly increasing costs and causing issues with the system because it was performing at a much lower level then it was designed for.
Seeking construction savings up front is a worthy goal, sure, but losing the ability to control your environment long-term due to improperly scoping your business needs? That’s a headache you just can’t afford.
2. Too Humid
If the HVAC in your facility isn’t designed to remove the same amount of water from the room that you’re putting into it, you’re going to have issues. Plain and simple. And with regulations regarding mold and mycotoxin presence sure to increase and become standardized in the event of federal cannabis legalization, it’s in your best interest to make sure your facility does everything it can to prevent mold growth.
Mold can produce toxic compounds called mycotoxins, which when inhaled or ingested can cause serious adverse reactions in humans, particularly in immunocompromised individuals or people with asthma. Aflatoxin and ochratoxin are two common mycotoxins resulting from improper growing or storage conditions and can create dangerous working conditions in addition to the risk they pose to consumers.
And keep in mind, remediation often isn’t enough — many mitigation efforts fail to completely remove mold and mycotoxins, or damage the crop in such a profound way as to make it unsellable.
3. Pests Find an Entry Point
Improperly sealed doorways, loading docks and ceilings, among other openings, basically act as flashing “Vacancy!” signs for pests. But sealing is only half the battle in sustainably protecting your facility; establishing an ongoing integrated pest management system is the other half.
A good IPM system will make a plan to block out or mitigate common diseases like powdery mildew and pests such as spider mites, thrips, russet mites, root aphids and fungus gnats. Facility design is a crucial element of this step — should you experience an outbreak, the last thing you want is to have it spread into every room designated for vegetative growth or flowering. Ensuring proper ventilation and appropriate layouts including sealable doorways and hallways will help keep potential problems contained.
4. Not Scoping Personpower
People can be your greatest asset — or your company’s biggest downfall. I’ve had clients spend significantly too much on employees to run a cheaply built but inefficiently designed space. With a well-thought-out facility layout, including irrigation, automation capabilities and workflow development, you’ll save big on labor costs in the long term.
And, side note: If you’re building a facility out in the boonies, make sure you’re at least close enough to a population center to support your facility’s labor needs.
5. Not Understanding Regulations
Lastly, make sure you get a handle on local and state regulations before you sign any dotted lines.
What do regulations have to do with facility layout?
A lot, it turns out.
Say your expansion means you need to cut additional drains into your facility’s floors. Some municipalities, believe it or not, will not allow for this kind of structural change depending on building type and zoning restrictions. That’s not the kind of information you want to learn after you’ve signed a lease or purchased a new facility.
Similarly, there are caps and limits on the number of plants, square footage and more for cultivation facilities that vary by state (or even municipality). Get those numbers nailed down so your scalability plan is aligned with regulations.
And it’s never too early to open lines of communication with state or local regulators, especially those you’ll need to work with to get licensed. They are a wealth of knowledge, and the sooner you’re able to pick their brains about regulations, the better.
The Bottom Line
Good facility design is no accident. And the right design can help you start generating cash flow, scale up and position you for competitive success — even if the bottom completely falls out of wholesale cannabis prices.
Put the time in now to make sure your facility is safe, compliant and scalable. You’ll thank yourself down the line.
Aaron Mullins is systems coordinator for Next Big Crop, a full-service cannabis consulting firm with decades of collective expertise in license procurement; facility design and construction; systems engineering; equipment and materials sourcing; operations management; and compliance. He oversees facility design and defines scope, goals and deliverables for all Next Big Crop building projects. He provides support for the construction phase of cultivation facility buildout, guides and expedites the construction process, and coordinates all automated systems to ensure they interface properly while maximizing efficiency and production.