Scaling a pre-roll business can be particularly challenging and complicated, especially in a new industry where all the tech that supports it is also new.
To avoid the common pitfalls most brands run into when scaling pre-roll production, leaders need to consider challenges relative to their own business, their unique positioning in the market, and the solutions that may help leverage that information and navigate those challenges successfully.
This isn’t news to you. Expenses in the cannabis industry add up quickly, and thanks to 280E, there’s hardly any relief come tax season. In a pre-roll business, especially one that’s looking to scale, there are a few major expenses to keep in mind:
- Manpower: You need staff to help operate machinery and scale up your business.
- Consumable Materials: The more pre-rolls you plan to make, the more you’ll need flower, paper, tips or filters, and packaging. Not to mention any concentrates if you’re going infused. And don’t forget your own consumable products, like the parts of any automated machinery you use that will need replacement from general wear and tear. Also, consider the extra money you may end up paying for utilities like electricity.
- Marketing: A good product is useless if nobody knows about it. If you’re trying to grow and sell more, you need to increase your audience and your demand. That takes marketing brains and dollars.
Implementing automation into your business as you scale addresses a lot of the above costs head-on, but only if you choose the right automation. Of course, there will be an upfront price tag to bringing automation into your business, but if done correctly, your increased earnings will quickly cover that.
The biggest thing to automate in any pre-roll business is the actual pre-roll-making process. To choose the right automatic pre-roll machine for your needs, it’s important to consider:
- The volume you need to move now
- The volume you’re looking to scale to and how long you project it will take you to get there
- How much it will cost to expand/replace the pre-roll machine you’re about to buy once you reach your current goal and move to scale even bigger
- The quality of the pre-roll the machine you’re considering produces and how consistent it is at maintaining that quality
- Will the machine cut or increase your consumable materials costs?
- Will the machine cut or increase your utility expenses?
- How many people are required to operate the machine and do they need to have special skills?
- How many pre-rolls can the machine produce per shift?
It’s a lot to keep in mind, but knowing upfront exactly what you want, need, and can expect will make it a lot easier to narrow down the right pre-roll machine for your needs. And once you have that machine working, you’ll be able to streamline your operations by being able to more accurately predict:
- Overhead costs (labor, electricity, etc.)
- Output (how many pre-rolls per day, per batch, per hour, etc.)
- Consumable material costs (how much flower, paper, filters, packaging, etc. you use)
Knowing these exact numbers will make it exponentially easier to scale up again after you reach your current goal.
All of the above considered, there’s no real point to scale your pre-roll business if you’re not going to prioritize producing consistent, quality pre-rolls. Competition in cannabis is fierce, and it’s only going to get more intense once the plant is federally legalized or rescheduled and interstate commerce opens up.
To prioritize quality, you need to ensure you have a proper grinder and a proper pre-roll machine, apart from, of course, good bud. A big blender or coffee grinder isn’t going to cut it. Stuffed pre-made cones aren’t going to cut it either. Pre-rolls were never stuffed prior to the legal market anyway—they were rolled. (Consumers notice when a pre-roll they spent hard-earned dollars on doesn’t hit right and/or runs, and they remember it too!)
When the savings begin to add up after successfully scaling up pre-roll production processes, re-investing those savings towards your marketing brains is a wise move to get your product in front of and into the hands of as many people as possible.