How to Budget for Automation in Your Cultivation Facility

If you’re on the fence about automation, it’s time to pick a side.

Next to electricity, labor is the most significant contributor to production costs, and automation can play a vital role in helping to lower this primary operational expense.

But how much money should you budget for automation upgrades?

Consider the following two options for determining what kind of investment is appropriate for your cultivation business.

Option One: The easy way

Through observation and record-keeping, select an area of production that you believe can be refined down to a much more efficient process.

Then, go into the marketplace and identify equipment or technology that can help speed up that task. Visit a trade show, do research online, or ask a trusted supplier to point you in the right direction.

When you find an automated solution, add up the costs of purchasing, shipping, installing, commissioning, and operating the equipment. Once you have gathered price information and the associated operating costs… violà! There’s your budget.

The money you should spend on automating a particular task will be the going rate for that equipment or technology in the marketplace. It doesn’t need to be more complicated than that.

Option Two: The math way

Depending on who will be funding the purchase, you may need to be more specific regarding costs and return on investment (ROI). Unless the money is coming out of your own pocket, eventually, you’ll need to justify the purchase to an investor, business partner, or your boss.

Let’s look at two of the most labor-intensive areas of the cannabis production process:

Fertigation

The mixing and delivery of nutrient-rich water to plants is called fertigation.

Most crops are watered every two days. Growers will saturate a pot, allow the media to dry out for a day or two, and then water again.

The time it takes an employee to walk the crop, determine when to irrigate, fill tanks with water, measure and mix fertilizer, apply it to the crop, and then empty and clean the tanks can account for up to 40% of an employee’s workday.

Each week, they could easily spend ten hours on fertigation activities. At $15 per hour, that’s $7,800 a year spent on watering plants… and that’s just one employee! Most commercial operations employ throngs of workers that handle dozens of grow rooms each week.

The alternative is an automated fertigation system that costs between $40,000 and $80,000. Closed-loop systems that capture and reuse fertilizer runoff can easily top six figures.

Expensive? Compared to the laborious alternative, not really. For large operations, an automated fertigation system will pay for itself in less than a year.

But these systems offer another benefit just as valuable as labor savings: they increase the consistency of cannabis by eliminating human error.

When employees measure and mix fertilizer by hand, their mind can be anywhere—with their girlfriend, a new car, or tonight’s game. It’s easy to lose track and forget which minerals have been added to the water. Any oversights that occur while mixing fertilizer could negatively affect the entire crop.

With an automated fertigation system, a computer precisely measures and mixes fertilizer the same way each time.

Trimming

The process of removing leaves from cannabis flowers is called trimming.

When done by hand, it’s a long and monotonous process. The average employee should be expected to hand-trim one pound of dry cannabis flower during an 8-hour work shift.

A harvest of 100 pounds would take one employee 100 days to trim, or it would take a team of ten trimmers ten days to complete the same task. Either way, at $15 an hour, it will cost an operator $12,000 to hand-trim a 100-pound harvest. Commercial operators on perpetual harvest cycles dedicate a lot of money towards hand trimming.

It’s also challenging to keep a trim team staffed. Given the repetitive and monotonous nature of the job, there’s a lot of turnover. Trim rooms are a constant influx of new hires and outflow of burned-out employees. For growers that harvest infrequently, there’s the additional challenge of constantly hiring and laying off workers.

Automated trim machines can handle the same 100 pounds in one workday with just two employees. These machines average $15,000 – $25,000 each, so the payback can be realized in just a few harvests.

Automatic trimmers can handle wet or dry flowers, and machine speeds can be adjusted to slow down the process to treat delicate flowers more gently. There are lots of trim machines on the market that rival the quality of hand-trimmed product.

The decision to upgrade or automate grow equipment shouldn’t keep you up at night. Determine how much a specific task is costing you, identify the market rate for technology that can expedite that process, and then calculate how soon you’ll make your money back.

If the ROI is two years or less, go for it!

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