Return On Investment: Manufactured Cannabis Products VS Plain Old Flower

What intricate interplays of manufacturing strategies and market dynamics hold the key to enhanced return on investment (ROI) within the cannabis supply chain?

This strategic approach not only caters to diverse consumer preferences but also holds the potential to amplify profitability and open new market niches, showcasing the evolution of the cannabis industry into a resilient and innovative market.

Explore the transformative impact of manufacturing throughout the cannabis supply chain at the upcoming Benzinga Cannabis Capital Conference, alongside expert panelists including Andrew Glashow, CEO of CLS Holdings; Rob Wirtz, Co-Founder and president of Mach Technologies; Luna Stower, CIO of iSpire Technologies; and Arnaud Dumas de Rauly, CEO of The Blinc Group.

Understanding ROI: Profits and Investments in the Cannabis Industry

Return on Investment is a measure that helps us understand the profitability of an investment relative to its cost. For instance, if we spend $100 on marijuana equipment and it generates $150 in profit, our ROI is 50%.

In the context of the cannabis supply chain, ROI reflects how much profit is earned compared to the cost of producing and selling cannabis products. Value-addition activities, like creating concentrates or infusing edibles, improve ROI by increasing the perceived value of the products.

This allows producers to charge higher prices and when the increased revenue surpasses the additional production costs, ROI goes up.

Manufacture, Value Addition And ROI in the Cannabis Supply Chain

One example is concentrates. Extracting cannabinoids and terpenes creates potent oils, waxes and shatters.

These command premium prices, resulting in a significantly increased ROI compared to raw flowers. Infused edibles offer another avenue, appealing to those who prefer alternative consumption methods.

Precise dosing and gourmet offerings create collaboration opportunities, expanding distribution networks.

Cannabis-infused topicals provide localized relief, capitalizing on wellness trends. Crafting pre-rolled joints with curated blend tailors experiences, elevating pricing and ROI.

This journey from plain flowers to value-added products illustrates the power of differentiation.

Enriching products at every stage transcends commodity limitations, capturing niches and establishing connections with consumers. This approach not only propels ROI but also establishes a resilient and innovative cannabis market.

The Benzinga Cannabis Capital Conference, the place where deals get done, is returning to Chicago this September 27-28 for its 17th edition. Get your tickets today before prices increase and secure a spot at the epicenter of cannabis investment and branding.

Photo by Petr Magera on Unsplash.