Report Shows Cannabis Cultivators Are Not Happy but Few Plan to Leave the Industry
/Despite the many frustrations cannabis cultivators reported in the Wells Fargo and Cannabiz Media research report, Cannabis Cultivator Survey Edition 2 – No Recovery in Sight, just 18% of licensed growers plan to decrease production in the next 12 months.
The researchers also discovered cultivators’ current sentiment about the markets they operate in as well as whether or not they have plans to exit the industry in the near future. Let’s take a closer look at the data.
How Licensed Cannabis Cultivators Feel about Their Markets
The second edition of the Cannabis Cultivator Survey was conducted in Fall 2022 and provides insight into licensed grower sentiment across six key states deemed to be representative of the largest cannabis markets in the United States today: California, Colorado, Michigan, Oklahoma, Oregon, and Washington. The data can also be compared to results from the first Cannabis Cultivator Survey that was conducted in Spring 2022 to determine if there are any changes.
In Fall 2022, 36% of cannabis cultivators reported feeling positive about the markets they operate in while 64% reported negative feelings. This didn’t represent a significant change from Spring 2022 when 38% of growers had positive feelings and 62% reported negative sentiment. Here’s the breakdown:
I feel great. Everything is wonderful: 4% (up from 1% in Spring 2022)
I feel good. Things aren’t perfect but they are fine: 11% (up from 7% in Spring 2022)
I feel okay. Things are manageable but could be better: 21% (down from 30% in Spring 2022)
I feel bad. Things don’t look good: 28% (up from 21% in Spring 2022)
I feel terrible. Things look awful: 36% (down from 41% in Spring 2022)
As found in the Spring 2022 report, cultivator sentiment varies quite a bit based on where licensed growers operate. Here is the state-by-state breakdown for Fall 2022:
California – 83% feel bad or terrible (down from 86% in Spring 2022)
Colorado – 63% feel bad or terrible (up from 47% in Spring 2022)
Michigan – 20% feel bad or terrible (up from 17% in Spring 2022)
Oklahoma – 53% feel bad or terrible (up from 47% in Spring 2022)
Oregon – 58% feel bad or terrible (down from 62% in Spring 2022)
Washington – 80% feel bad or terrible (up from 63% in Spring 2022)
The data shows the majority of growers in five of the six states feel negatively about their markets, and in California and Washington, four out of five growers feel bad or terrible. Negative sentiment decreased between Spring and Fall 2022 in all states except California and Oregon.
Looking at the Fall 2022 data for cultivators who report not just positive sentiment but actually that they feel great about their markets, the numbers paint a grim picture:
California – 2% feel great (up from 1% in Spring 2022)
Colorado – 0% feel great (down from 6% in Spring 2022)
Michigan – 0% feel great (no change from Spring 2022)
Oklahoma – 6% feel great (up from 1% in Spring 2022)
Oregon – 2% feel great (no change from Spring 2022)
Washington – 11% feel great (up from 5% in Spring 2022)
Cannabis Cultivator Exit Plans
With 62% of cannabis cultivators saying they feel bad or terrible about the markets they operate in, you may think many of them would be actively planning to exit the industry. However, that’s not the case.
Only 22% of licensed growers across the six states surveyed in this study are planning a full or partial exit from the cannabis industry within the next three months, which is down from Spring 2022 when 27% of growers reported they had full or partial exit plans in place.
Here’s the breakdown by state of growers’ responses when asked in Fall 2022 if they’ve considered leaving the industry in the next three months:
Yes, I’m planning a full exit: 14% (down from 15% in Spring 2022)
Yes, I’m planning a partial exit: 8% (down from 12% in Spring 2022)
I’ve thought about it but haven’t taken any steps to exit yet: 41% (up from 37% in Spring 2022)
I haven’t thought about exiting at all: 37% (no change from Spring 2022)
The breakdown by state shows that more cultivators are thinking of exiting the industry in Colorado than any other state. This is a change from Spring 2022 when more growers in Oregon were thinking of an exit than any other state. Here’s the state-by-state data:
California – 29% planning a full or partial exit (down from 32% in Spring 2022)
Colorado – 44% planning a full or partial exit (up from 38% in Spring 2022)
Michigan – no responses (no change from Spring 2022)
Oklahoma – 17% planning a full or partial exit (down from 19% in Spring 2022)
Oregon – 31% planning a full or partial exit (down from 40% in Spring 2022)
Washington – 14% planning a full or partial exit (down from 23% in Spring 2022)
How Cannabis Cultivators Can Leverage the Data to Gain a Competitive Advantage
While there are many challenges for licensed cultivators, there are also opportunities to learn from the data and build a stronger business that can overcome the obstacles currently inherent to operating in the cannabis industry. Growers who invest time and money to improve operational efficiency, maximize ROI, and differentiate themselves from their competitors will not only survive the difficult times but actually thrive in the long-term.
A simple change that can give growers a significant long-term competitive advantage is switching to bio365 grow media, which actually helps solve some of the primary frustrations cited by cultivators in the Cannabis Cultivator Survey.
In simplest terms, bio365 media can reduce your total cost of growing. You’ll save money, improve the quality of your crops so you can demand higher prices, and increase your yield. Ultimately, your reputation for growing high quality cannabis and the cost savings you’ll realize will position your business as an industry leader.
The key to success is making changes sooner rather than later. You can test bio365 grow media at your facility and measure how it improves your yields, quality, and ROI. The bio365 team of soil experts can even help you set up and conduct your tests! Contact us to start a free trial.