Last week, Allay Consulting announced a new hire, a previous cannabis regulator for the city of Denver. Kara Lavaux has earned her Certified Professional-Food Safety (CP-FS) certification and supervised the Denver Department of Public Health & Environment’s cannabis program before joining Allay Consulting.
“Demand is increasing for compliance assistance in the industry,” says Kim Stuck, CEO and founder of Allay Consulting. “Kara brings a robust background as a pioneer for cannabis public health regulations. With the hemp market gearing up for federal regulation, this was the ideal time to expand our team.”
“As one of the first Marijuana Specialists in the nation, I wanted to stay in the cannabis industry,” says Lavaux. “Joining the Allay team allows me to utilize my regulatory knowledge to support hemp and cannabis companies and help them thrive.”
Lavaux brings more than 14 years of experiences as a regulator in Colorado, with six years of experience overseeing the cannabis program.
It’s a different world growing cannabis in California- in fact, it’s a completely different experience than it was even four years ago. It can be overwhelming to begin the process, which is where an experienced cultivation consultant can help. This article will highlight 5 factors to keep in mind before you begin growing in California’s regulated recreational market.
Start Up – Costs, needs & endless variables
So you’ve decided to begin a recreational grow, here are the factors to consider before you get started.
Permitting, the necessary pre-cursor to cultivation, can be time- consuming, extremely expensive, and overwhelming. General experience dictates that any grow will take longer than planned and cost way more money than you ever expected or anticipated. Always account for more money and time than you think you need. Working with an experienced consultant can help you plan and account for all the costs and variables you may not have considered, prior to beginning cultivation, in order to ensure your success.
Equipment. When choosing what equipment to use, stick to reputable equipment manufacturers. Don’t just go with the latest high-tech gear because you see it on Instagram being advertised by a big, fancy grow operation. Stick to what you know best. Do your homework and research the equipment as much as possible, prior to purchase. Use equipment that has been tested and well documented with success. Some questions to ask yourself: is this necessary? Is it cost effective? Will it help me reach my goals?
Grow your business slowly and naturally. Getting too big too quick will most likely expose inefficiencies in your operating plan, which will be further compounded when production increases. Don’t sink before you can swim and start out on a massive scale before you have perfected your process.
Cultivation – It pays to design it right the first time
Success begins in the grow room. Never forget that. A properly engineered cultivation plan can be the difference between 3 and 6 harvests per year. Again, it is imperative here to do your homework. A well-thought-out plan can make or break you, and that is where an experienced cultivation consultant can help.
Set realistic expectations. Understand that growing boutique style cannabis is very difficult on a large scale, consistently. Don’t expect to grow perfect cannabis every time – it is unrealistic and can ultimately lead to failure if your financial model depends on it. Growing a plant, while mostly in your control, involves too many variables to rely on a perfect outcome round after round. You can do everything in your power, yet something unexpected can still happen and be detrimental to your yield, and therefore your profit. You must expect and plan for this.
Automating as much of your grow as possible is always a good idea. This will greatly reduce labor costs and more importantly, minimize human error. In some instances, it will even allow you to review data and information remotely, in real time, allowing you to ensure your cultivation site is always running as efficiently as possible, even when you aren’t there.
Processing – Don’t skimp on the process
If you are going to be harvesting cannabis for flower, it is imperative to have a properly built facility for drying, curing and storing your product. You must consider that this building will need to be large enough to house and properly store all of your harvest at once. This can make or break your crop at harvest time. If you don’t have the capacity to handle your harvest properly, it can lead to disastrous issues such as mold or too quick of a cure – conditions which make your cannabis unsellable in the regulated market.
Although costly, if done correctly, you can also design this area to serve as your propagation, trimming, and breeding areas, which will ultimately save on costs in the long run.
Also keep in mind, hand trimmed cannabis will always look more appealing to the consumer than machine trimmed cannabis. However, hand trimming can be time-consuming, labor-intensive, and therefore far more costly than machine trimming. These are factors you will need to consider and budget for when deciding how to proceed. If you use a machine, you may save money up front, but will you be able to sell your cannabis at full price?
Distribution – Have a plan
It is a good idea to have a plan for distribution, prior to start up. If you have an agreement with a retail outlet (or contract with a distributor) in writing, you will protect yourself from financial failure. Cannabis will never grow more valuable over time, therefore, you want to have a plan in place for distribution, as soon as the cannabis is harvested and processed. Just as was the case in the black-market days, you never want to hold on to your cannabis for long periods of time.
Do not distribute without agreements in writing! While some oral agreements may be enforceable, it will be extremely costly to litigate. Therefore, you should plan to hire a lawyer beforehand to create fail-proof agreements that will hold up in court, should a distributor not pay you for your product.
Sales – Build your brand, but be realistic
Building your brand is important. And if you don’t produce your own high-quality flower you cannot expect to have a product up to your standards. Your brand will not be successful if you cannot consistently provide consumers with high quality cannabis. Relying on other growers to produce your cannabis for you is risky to your brand. Even if you are a manufacturer, you may not be able to rely on other suppliers to maintain the quality volume you need in order to manufacture your products consistently.
The regulated market in California is new. Therefore you must necessarily account for a great degree of price fluctuations in the market. When creating your budget at the outset, you must account for fluctuations in profit. Knowing when prices are going to be at their lowest can help you avoid having an oversupply of inventory. It can also help you avoid such situations by planning your cultivation/harvest accordingly.
There are both consumer and government influenced market trends that can affect your bottom line. These must be accounted for at the outset.
On the consumer level, you must know what people are buying and how they are consuming. And these factors can change quickly with the introduction of new technology, methods or new devices intended for cannabis consumption. You must stay on top of these trends.
The government regulations can also affect these trends. Products used for cultivation can become banned, i.e. products you once relied on in your cultivation can be found to have contaminants known to cause test failures, even in “approved products.”
Ultimately, all of these factors can make or break your success, and therefore, must be considered, researched and accounted for prior to beginning your cultivation in the regulated market. Working with a consultant with over 20 years of grow experience, and more importantly, extensive experience in large scale cultivation in the regulated market, can help you achieve the success you desire. Cultivation in the regulated market is costly, but working with a consultant can help you cut costs at the outset, and save you from unexpected expenses in the long run.
Hiring an experienced cultivation consultant is yet another cost, amongst the laundry list of never-ending expenses in the setup of a regulated, recreational grow. However, in the big picture it can actually save you a significant amount of time and money by providing you with the information you need to formulate a realistic budget, profitable cultivation site and a well-trained workforce. This article will explore just some of the many benefits a cultivation consultant can provide to your company.
An experienced consultant will have a vast array of knowledge to ensure the success of your company. One important area they can advise you on is budgeting. With years of experience cultivating, in both medical and recreational markets, an experienced consultant will have knowledge of not only start-up costs, but also hidden costs you must prepare for in advance. They will also be able to advise you on strategies to avoid future costs and problems. There may also be expenses in the build-out of your cultivation site you have not considered. For example, you may need a waste water treatment plan if you have any fertilizer run off that will flow to a sewage drain. It is important to know all possible costs when securing your investment or planning out your budget for the year.
Setting up a large-scale cultivation site in a regulated market can be extremely costly. Gone are the days of putting up a few lights in a closet; growing in a regulated market requires a larger scale, and therefore, larger costs and more complications. A consultant experienced in design and implementation of such large-scale, intricate cultivation plans will provide you with the knowledge you need to properly set-up and maintain your facility in order to ensure your company’s success. They will also know the tips and tricks to save you money along the way.
A good consultant will be able to advise you on the design of your facility to ensure that the layout supports productivity, and that there is a proper workflow. It is important to hire a consultant before you get started with the build out of your facility, as it will be much more costly to have to correct mistakes in your design later on down the road. An experienced consultant will implement superior facilities layout and design to avoid future problems at the outset. Something as simple as a centralized irrigation distribution zone can save you a lot of time and money.
Once you have created the proper space, cultivation planning is important to avoid unnecessary problems from arising, which will ultimately delay profit. A well thought out cultivation plan will help you plan for success. A consultant will know what does and doesn’t work. For example, some equipment will run off an app on your phone; while convenient, there are some that don’t perform well which could end up costing the entire crop. These are things you want to know and work around, before you spend money unnecessarily.
An experienced consultant will have previously worked in various types and scales of cultivation sites, and from that experience will be able to teach you which processes and techniques work, and which ones don’t. Someone with less experience may believe that watering plants by hand would be an easy method to keep your garden irrigated, but it is actually the most time-consuming labor task (and therefore extremely costly), while an automated watering system can be very simple and cost-effective to install.
A skilled consultant can provide necessary training for your employees. Let’s face it, this is an entirely new industry, and therefore, most people applying for entry-level jobs at a cultivation site are unskilled. However, the best path to success when dealing with large-scale cannabis cultivation is to have skilled, happy employees. Educating and properly training your employees is essential. It helps to teach employees not only how to complete a task, but to help them understand why they are doing a given task. This will give your staff the skills and confidence they need to complete the task properly. Unskilled hands in your garden can jeopardize the success of your cultivation.
Don’t make the same mistakes others have made. Hiring a cultivation consultant can help you to avoiding problems before they occur. A professional consultant has the knowledge required to predict issues and problems before they occur, or implement a solution when corrective measures are necessary. Oftentimes issues can be avoided just by knowing the cause and effect of decisions and the potential outcomes they will have.
A cultivation consultant should also have a wide network of professional contacts to help you address any issues or problems that arise. Having a network of professionals to employ when necessary is critical for ensuring the success of every project. For example, wholesale contacts for cultivation equipment can help you not only to get the best price, but also ensure you are using the best equipment possible for your situation.
If you are still unsure about whether or not you need a cultivation consultant to help plan out your grow, or fix your grow if you’ve encountered problems, feel free to contact me to discuss your needs. I assure you there are ways I can save you money, improve your yields, and help your company be more successful in this ever-changing market.
The cannabis industry is growing fast as more states implement legislation to legalize cannabis in different ways. If you’re trying to break in or keep your place in this new market, it can be difficult to understand and comply with ever-changing government regulations as you try and scale your business.
Cannabis businesses need to comply with a range of new local, state and federal regulations related to cannabis specifically, in addition to regulations already in place for the pharmaceutical and food industries to ensure their products are safe for public consumption. On top of that, there are the complexities of managing a supply chain, including growing, warehousing, transportation, food safety requirements, product labeling, business plans, marketing, selling and any other necessities that come with running a businesses.
This is a lot of new information when you’re vying for your place in the cannabis industry. That’s why some businesses are turning to consultants to help. Consultancy is a great and time-tested way to grow your businesses and keep a competitive edge. But just like every other industry, when you choose a consultant, there are specific things to look for and avoid.each party will have work to do in order to communicate clearly, define responsibilities and execute on a plan.
Understand the Role of Consultants
The expertise of cannabis consultants can vary widely. Usually there’s no “one stop shop” for everything you need to run your business, meaning consultants often specialize in a specific area. Consultant expertise includes specialties such as cultivation, manufacturing, food safety, dispensary, transportation, legal, accountants, human resources and more, all within different regulatory compliance wrappers.
It’s important to remember that consultants are usually not responsible for setting goals for you, but the right consultant can help you refine, meet and even exceed your goals. However, each party will have work to do in order to communicate clearly, define responsibilities and execute on a plan.
Focus on Your Specific Needs
Identifying your specific needs and understanding what success looks like for you is a critical step to take before contacting any consultant. This prep work helps you identify what kind of consulting you actually need and what you’re willing to spend to get it. Some consultants can help you tackle more than one area, but most will specialize. In fact, choosing several specialized consultants (if you have many needs), may feel like it costs more up front, but it will likely save you frustration, headaches and money in the long run. Additionally, if a consultant claims they can do everything in several areas of expertise, they may be overpromising on what they can actually deliver to you as a customer.
Ask the Right Questions
When vetting a consultant, it’s your job to ask probing questions. Don’t hold back and don’t be put off by vague answers. If a consultancy avoids questions or can’t give clear answers, they may be overpromising or being less than honest about their skillset. Here are some general areas of discussion to help you get started when interviewing consultants:
The consultant’s relevant experience.
Past or current client references.
Detailed discussion of your specific needs as a business.
How much time can the consultant dedicate to you as a client.
Detailed outline of the consultation plan, including a clear timeline.
Responsibilities of each party, deliverables and what success looks like for customer sign off.
Certifications and credentials if relevant to your consultation needs (e.g. legal, accounting, regulatory).
What is and is not included with their quoted fee, and what you may be charged for as an “add on” to your contract.
Any possible conflicts of interest, including how consultants separate work for clients who are competitors.
Avoid Red Flags
As with any burgeoning market, there will be consultants who get into the cannabis space that are more interested in making money than helping you as an individual client as businesses work to legitimize the industry as a whole. Doing your research and asking for referrals helps, but there are also red flags to look for. Some of these red flags may pop up due to inexperience and some may be a sign of bad actors in the consultant market.
Asking for equity as payment.
Refusing to provide references.
Avoiding questions or giving unclear answers.
Unwilling to track time and itemize costs on bills.
Overpromising AKA “this sounds too good to be true.”
Dominating the process instead of treating you like a partner.
Build a Strong Relationship
To get the most out of a consultancy experience, it’s important for both parties to work at building a strong business relationship. You know you’re hitting the sweet spot in business relationships when you have well-oiled communication and feedback loops, including honesty around expectations and frustrations from both parties. A great consultant wants feedback so they can improve their process, therefore they will actively listen to and address your concerns. Additionally, it’s important for you as a client to also be open to feedback and ready to make changes to your process to get the best return on your investment.
I worked for about 18 years as a company employee in various levels from entry-level engineer to senior director. Since then I have spent over a decade as a consultant in the life science industry as the founder of Sebald Consulting. Presently, I also use consultants as CEO of GxPready!, a web based CMMS software company. Based on this experience, I have put together a top 5 list of things you can do to get the most value when using consultants:
1. Recognize when a project requires a consultant
There can be several reasons a project may benefit from having a consultant which may include bringing a new skill set, industry experience or an outside perspective to bear on a project that is not available otherwise.
Provide clear guidance as to what the task and deliverables are on an ongoing basis.Also, there are occasions when resources are already stretched and you need short-term support to get through an intensive segment of a project, but the work may not be enough to justify additional longer-term resources.
In any of these cases, filling the gap internally can be difficult and time consuming. A consultant can be a great solution. Even if you don’t plan to use a consultant for the project, it may be to your benefit to have a consultant perform a “gap assessment” to help you to identify areas which require improvement to meet compliance requirements or best practice guidelines. This is often done to prepare for audits, for example.
2. Vet the consultant to get a good match
Contact potential consultants to determine if they have the set of skills you are looking for and if they fit within the culture of your organization. Talk to the actual consultant you will be working with before bringing them on. Review the consulting contract carefully to make sure the terms are mutually acceptable. Often consultants have some flexibility to accommodate different project situations.
One advantage to using consultants is that you don’t have a long commitment so even after you vet them with interviews, you can work on small projects and gauge the results. Some consulting companies are very formal and others are less so, for example. A good fit is better for both parties. It’s not just the competence, but the culture and personal fit with your team.
3. Provide the consultant with appropriate guidance and resources
Help the consultant give you the best results possible by providing access to the resources (personnel, information, documents, systems, etc.) to allow the consultant to perform the tasks.
Provide clear guidance as to what the task and deliverables are on an ongoing basis.
Alternatively, allow the consultant to manage the project and reach out as necessary. Any guidance and resources you can provide the consultant will increase the effectiveness and help control your costs on the project.
If you don’t know exactly what needs to be done (“That’s why I hired a consultant!”) then have the consultant put together a list for you based on some general guidance and then work from that list to get your job completed.
4. Track progress with appropriate level of detail
If you have vetted and hired a consultant, chances are they are going to put in their best effort to meet your requirements. Nonetheless, it is good practice to have a system in place to track hours/costs.
Whether it is weekly reporting, or based on milestones and project updates, this helps to avoid any misunderstandings and provides opportunities for communication of project issues in addition to whatever project updates may be scheduled.
You want your team of consultants and employees to be able to work as well as possible together.Recognize that you can go overboard in this area, working against yourself and the project, if the tracking is so detailed that it takes excessive resources to document. It is definitely possible to inadvertently generate more hours (and expense) by managing time in too much detail. If the concern is high and heavy management is required, perhaps that indicates the consultant is not the best match for this project.
Generally, you can find a good balance with a simple up-front chat with the consultant to review your expectations, and for larger projects it is often formalized in the contract.
5. Recognize if it’s not a good fit
There are many consultants and clients out there. Inevitably, there are times when, despite best intentions, the consultant/client mix isn’t working out. Make sure the contract allows for management of this situation. Can you cancel the contract with reasonable notice? Is there a mechanism for being able to replace members of the team that aren’t working out?
You want your team of consultants and employees to be able to work as well as possible together. If that’s not happening, recognize it and make adjustments as necessary. But don’t lose the contact information. A consultant that doesn’t work out today may be just right for your next project!
Following the above can improve your chances of success with consultants you may hire and allow you to build a solid set of resources you can call on from time to time as things change in your company. Consultants can fill a vital role for tasks requiring specialized skills or short-term projects where a full time hire is not practical.
In the first part of this series, we spoke with Michelle Bradac, senior accreditation officer at A2LA, to learn the basics of cannabis laboratory accreditation. In the second part, we sat down with Roger Brauninger, A2LA Biosafety Program manager, to learn why states are looking to lab accreditation in their regulations for the cannabis industry. In the third part, we heard from Michael DeGregorio, chief executive officer of Konocti Analytics, Inc., discussing method development in the cannabis testing industry and his experience with getting accredited.
In the fourth and final part of this series, we sit down with Susan Audino, Ph.D., an A2LA lead assessor and instructor, laboratory consultant and board member for the Center for Research on Environmental Medicine in Maryland. Dr. Audino will share some insights into method validation and the most technical aspects of laboratory accreditation.
Susan Audino obtained her Ph.D. in Chemistry with an analytical chemistry major, physical and biochemistry minor areas. She currently owns and operates a consulting firm to service chemical and biological laboratories. Susan has been studying the chemistry and applications of cannabinoids and provides scientific and technical guidance to cannabis dispensaries, testing laboratories and medical personnel. Dr. Audino’s interest most directly involves cannabis consumer safety and protection, and promotes active research towards the development of official test methods specifically for the cannabis industry, and to advocate appropriate clinical research. In addition to serving on Expert Review Panels, she is also chairing the first Cannabis Advisory Panel and working group with AOAC International, is a member of the Executive Committee of the ASTM Cannabis Section and has consulted to numerous cannabis laboratories and state regulatory bodies.
CannabisIndustryJournal: What are the some of the most significant technical issues facing an accreditation body when assessing a cannabis-testing laboratory?
Susan: From the AB perspective, there needs to be a high level of expertise to evaluate the merits and scientific soundness of laboratory-developed analytical test methods. Because there are presently no standard or consensus test methods available, laboratories are required to develop their own methods, which need to be valid. Validating methods require a rigorous series of tests and statistical analyses to ensure the correctness and reliability of the laboratory’s product, which is– the test report.
CIJ: When is method validation required and how does this differ from system suitability?
Susan: Method validation is required whenever the laboratory modifies a currently accepted consensus or standard test method, or when the laboratory develops its own method. Method validation is characterized by a series of analytical performance criteria including determinations of accuracy, precision, linearity, specification, limit of detection, and limit of quantitation. The determination of system suitability requires a series of deliberate variations of parameters to ensure the complete system, that is all instrument(s) as well as the analytical method, is maintained throughout the entire analytical process. Traditionally, method validation has been referred to as “ruggedness” and system suitability as “robustness.”
CIJ: What are the most important aspects of method validation that must be taken into account?
Susan: In keeping with the FDA guidelines and other accepted criteria, I tend to recommend the International Conference on Harmonization (ICH), particularly Q 2A, which is a widely recognized program that discusses the pertinent characteristics of method validation. This include: method specification, linearity, range, accuracy, and precision (e.g., repeatability, intermediate precision, reproducibility). As mentioned earlier, system suitability is also a critical element and although related to method validation, does require its own protocol.
CIJ: What three areas do you see the laboratory having the hardest time with in preparing for accreditation?
Susan: My responses to this question assume the laboratory employs appropriate instruments to perform the necessary analyses, and that the laboratory employs personnel with experience and knowledge appropriate to develop test methods and interpret test results.
By and large, method validation that is not appropriate to the scope of their intended work. Driving this is an overall lack of information about method validation. Oftentimes there is an assumption that multiple recoveries of CRMs constitute “validation”. While it may be one element, this only demonstrates the instrument’s suitability. My recommendation is to utilize any one of a number of good single laboratory validation protocols. Options include, but are not limited to AOAC International, American Chemical Society, ASTM, and ICH protocols.
Second is the lack of statistically sound sampling protocols for those laboratories that are mandated by their governing states to go to the field to sample the product from required batches. Sampling protocols needs to address the heterogeneity of the plant, defining the batch, and determining/collecting a sample of sufficient quantity that will be both large enough and representative of the population, and to provide the laboratory an adequate amount from which to sub-sample.
Third, sample preparation. This is somewhat intertwined with my previous point. Once an appropriate sample has been collected, preparation must be relevant to the appropriate technology and assay. It is unlikely that a laboratory can perform a single preparation that is amenable to comprehensive testing.
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