Driving Profitability

Jennifer Polanz

Our team hit the road in early March for Indoor Ag-Con in Las Vegas, a conference and trade show that’s morphed over the years from a slightly heavier cannabis focus to more indoor food production with a cannabis track.

There are two words that can sum up much of what we heard and saw at this year’s event: unit economics. From Little Leaf Farms Founder and CEO Paul Sellew’s keynote to kick off the event to several of the sessions I sat in on and from many of the products I saw on the trade show floor, the goal was greater efficiency and consistency to drive unit economics and, ultimately, profitability.

It’s a change to the zeitgeist of the industry that, for quite a while, was focused on securing venture capital  funding to create proprietary designs and push technological advancements. Of course, that’s still happening today, but from what I heard at the show, it’s time to, in layman’s terms, buckle down and make some money.

How do you do that? One way is to produce products that are in high demand from consumers, which leads us to our cover story on salad kits. Several controlled environment ag growers have jumped into the lucrative world of salad kits, which consumers are buying at an increasing rate. However, offering these kits is far different than cutting and packaging your own leafy greens and taking them to market. 

Labor was another issue talked about at the show that can impact unit economics. One of the solutions is automation, but it can be an expensive investment that doesn’t always pay off. Our intrepid freelancer Dave Kuack explores choosing the right technology that’s going to help with profitability in the long run.

Of course, we have show coverage from Indoor Ag-Con that can help provide more insight into how to achieve those unit economics, as well as some new products we found on the show floor for you to explore.

I was lucky enough at the show to moderate a panel session on research and its role in the future profitability of CEA growers with two excellent speakers: University of Tennessee Assistant Professor Dr. Kellie Walters and industry consultant (and our new Inside Grower e-newsletter editor) Dr. Sean Campbell. They both spoke about the importance of working with researchers to further the understanding of crop production and sensory qualities for consumers. We’ve always valued industry research, which is why we run it in every issue.

In this issue, you can find the final installment in a series on cannabis propagation techniques from researchers at Clemson University and Part 3 from Michigan State University researchers’ end-of-production lighting research for leafy greens.

In the end, it’s about creating a safe, consistent product retailers can stock that consumers will buy and love. There are lots of ways to get there, and hopefully, within the pages of this magazine, we can help.