Indeed.
g/W doesn’t take into account time and money.
g/sqft/year doesn’t include costs.
$/lb = all costs (money and time [time is money]) / yield (how well you did). I think every business calculates efficiency based on cost vs production.
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I don’t think we are in disagreement.
You want to track equipment use so you can offer value in equipment uptime.
Certainly there is space for an LED manufacturer to relate value of their product in terms of meaningful metrics.
Knowing I am in the red by X tells me nothing about what to do if I am not on top of all aspects of my business.
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Hi All,
for us there are two metrics that count most: turnover per year and net profit ratio!
turnover per year
- Gram/pound per sqf per year is most important but does not take into account the quality of the product and also not the output of trimm, etc. So in the end I would use turnover per sqf per year!
net profit ratio
- to calculate the net profits all the costs have be deducted from the turnover. A method like long-run-average-cost-approach (LRAC) should be used in order to get reliable results. If you are interested to get deeper into the Economies of Scale in the Production of Cannabis you will find more informations in this paper: Cost_of_Production_Canna.pdf (340.8 KB)
Indoor LRAC Curves, Three-to 30-Year Scenarios:
So @growopowners and @mastergrowers I would be very interested whether the assumtions of the paper are matching reality!? Are the total cost of production per gramm inbetween $1.1 - $1.4???
In the end net profit per sqf (of canopy) per year is what is most interesting to us 
cheers
Christoph
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Hey @Matt-TRYM, this is a discussion I would like to have with you.
Will you be discussing this topic on the sustainability panel at CWCBExpo LA?
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@Growernick That’s a really great idea. I think the CWCBExpo LA panel would be a perfect opportunity to discuss this topic in more detail. Let me know if you want to chat sometime this week on this topic.
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Wow - glad to see this important business topic from Feb still being updated. I like that feature of this platform!
My $0.02; While a metric necessary for making many business decisions would include GPW(/kWh), labor, total overhead, net profit per sqf (of canopy) per year, etc. as pointed out by others, when making lighting decisions a business owner, lighting tradesman/salesman, etc. may simplify and use GPW.
For nutrient delivery system calculations I’ve used pounds per light, which converts to 25 sq. ft. and 16-20 sites/light. Best yields I encountered last year with dual-ended 1K was 3.15 PPL, two years before was ~2.6 PPL w/single-ended. But of course - many factors are involved and interrelated.
For new build-outs consider, in addition to operational factors of nutrient schedule, trimming, topping, yo-yoing, curing, etc., nutrient delivery system and overall room design, and other build-out factors will not only directly affect the quality and yield, but also the overall efficiency, labor and capital demand, and ultimately the ROI of any given operation. There is a lot to juggle for sure!
If there is a discussion at the upcoming CWCBExpo LA , please let me know!
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what is yield? whole plant wet? whole plant dry? just the buds? buds and leaves? if dry to what level of hydration. what level of trichome development?
so much variably to the “how much do you yield” question with absolutely no guidance to the parameters.
if folks are not including the parameters in their answers the answers are largely useless.
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the prob here chris is that most these outfits are capital poor and their profit levels are usually in question. because the pressure to lie about things to potentials for monetary reasons or just peeing contests is high.
Another is lease costs un attended overhead, unfixed capital burn executive compensation, consultant costs, to what level do they undercut their employee wages and benefits etc. do they pay their bills, cheat on their taxes, and how well do they run their businesses, energy costs water costs, facility maintenance costs legal costs, the owners cocaine habit costs, employee overturn costs. legal costs etd, etc, ad nausium.
all these and more make the "profitability’ metric simply unusable except in these types of weenie measuring contests .
the proper metrics should be grams of finished bud per watt of energy utilized by the array.
I mean cost per gram? come on man thats useless. what if I work 20 hours a day and take absolutely no pay steal all my inputs and the electricity as well? and sell in an area of high regulation plus mix in some dirt and tray bud from a farm in Oregon?
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If you
won’t make sence as well 
But to answer your question: Your $ per gramm of finished bud ratio would be outstanding but your risk/pain per gramm of finished bud ratio would be disadvantageous…
cheers
Christoph
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Kerry-OPhyllene,
I don’t necessarily agree here. You see, grams per watt does not take into account many of the other costs of running the business. Sure, as a grower this is important. But as a grower g/sq ft is also important! As is g/ cost of fertilizer, g/ cost of labor, etc. I understand your hesitation to use profit - as that can be variable, and many companies don’t profit in the first years, or at all. But, if you want to know how the business is operating you need to look at profit. Maybe gross revenue would be more appropriate if you don’t want to account for how the money is spent?
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what if I dont care about how much it costs you to grow ?
why should our common metric take into account your executive payroll packages or any other monitary expense.
what if I dig dirt out of my yard and feed the plants tap water?
the simpler the analysis the wider you can apply it.
but you require common terms ie # of dry bud per common unit of light or per common unit of space
unit of light for indoor
unit of space for outdoor
that way everybody’s scale is irrelevant and everybody can play
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I’ll try to elaborate on what I think cschubert was saying, but of course these are my own words…The problem is that even the metrics you mention are not universal…the closest one I tend agree with is space (i.e. g/m^2). Even then, what if your space is split into 1 veg room and 4 bloom rooms and someone else is using 1 veg and 1 bloom with the same total m^2. Other factors will affect the environment and thus output differently. And you can’t use any units of light, as this can be just as variable as any of your other inputs. (spectrum, intensity, efficiency all play a role) A grower could use 1000 watts of 3500k CFLs or 1000 watts of modern grow LEDs and get very different results.
If you want to ignore cost, no metric matters. It’s just “how much can you grow given no limitations”. Personally, especially after hearing some of the input to this conversation, I’d like to know total cost per g. This includes space, lighting, water, fertilizer, etc. Remember, this is commercial production we are talking about. If I were to hire a lead cultivator I cant ask them “How much can you produce in a 3,000 m^2 facility?” and leave it at that. What if they promise amazing yields but dont mention that this requires a $50/plant fertilizer program? Or that their method requires soil that costs $100/yard? Everything needs to be considered. Just look at commercial growers of other crops. They need to pinch pennies to maintain profit ratios. And we are growing for profit are we not? Or at least growing to to maintain our operation and provide medicine without digging ourselves into debt.
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Hi Kerry,
Sorry maybe my English is not good enought but I cannot follow you! So what are you trying to say?
If you are running a business you have to make sure that your total cost do not exceed your turnover, at least not in the long run. And that not only includes taking care of the cost of production (which is always more than electricity bills) but also to get your product sold for a fair price (balance between quality, quantity and market demand) And that’s where metrics could help to find a equilibrium!
- To hire a management team is unavoidable if your business is passing a certain size!
- To not fairly pay your staff is never a good idea especially if there is some competition about well-trained, well-educated and motivated people…
- To save money on quality, security, technology, safety, etc. is also not a good idea because the quality of your medicine will suffer and in the end you won’t be able to sell it…
As @cberg has said before we are talking about commercial production. What I am interested in, is to get more details about the status quo in smaller operations. The problem I see at the moment is that big business is rapidly entering the game. They do care about the metrics even if they don’t have too, since they are all backed with millions of $ and therfore can easily sit out price wars.
cheers
Christoph
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This a great topic.
I look at to basic type of costs.
My fixed overhead costs. What’s it cost to keep the doors open. The target number here was the nation greenhouse association average cost per square foot week.
The secon number I want is the cost of my lowest common denominator. In my case what did a sweet pea blossom cost vs an anemone flower.
I want lots of details to make sound informed decisions.
You can only compare apples to oranges if you can create a metric.
We tied all metrics to our chart of accounts. This way we can bill a crop directly. For any input into that crop. We would track by crop how long the irrigation ran. The numbers get booked back to accounting.
The trick for growers is going to be define a set of metric or KPI as references points.
Some costs are allocated to all crop occupying the space based on percentage of utilization. Bio releases of insects. Reading yellow cards and doing the counts from them.
Also we worked in production weeks. A calendar repeats it self on a 27 year cycle. A year can have from 51 to 53 weeks a year.
If you use weeks as a common metric you can associate cost across the operation.
The magic is in your chart of accounts.
So snapdragons in my system my have 53 entries in projects under accounting one repressing each cycle planted.
This gives me the ability to compare year over year and crop to crop by cycles
These are all space optimization queues.
How do I squeeze every dollar out of my capital investment.
Lights have to be accounted by crop cycle. Just as heating and cooling.
How much light went into the crop as is any other input.
Grams per square foot week is probably the root metric. Everything can be added on to this lowest common denominators.
Gram of dry weight is probably the way I would go.
To slice it more finally depends on what I am selling. If it is the percentage of THC per gram square foot week. Then that is my metric.
But we need to define what the root metric will be. Then you can create a nested set to represent each phase of the cycle. This allows you to pivot from one metric to another by using the intersection of the LCD to compare apples to oranges.
Full time equivalencies or FTE can be determined and charged back to the crop. How many FTE went into the gram per square foot week, by cycle. An FTE in agricultural business is defined by the 2088 rule. There are 2088 hours in a standard work year or 2080 in a standard business year for an office. The are adjusted to the work year model we use of weeks in a year. More hours in 53 week year than a 51 week year. So you can maximize your staff with a little queuing therory put into practice.
This is what growers do in all the rest of horticulture. How many times to a human interact with a plant.
I want to schedule my production that my core staff can do 95% of the work and crops are scheduled around this to some degree. For example Valentine’s Day crops required more than 100% of our available FTE’s we would hire one part time worker for the six weeks leading up to Valentine’s Day. But, the day after we where back within our production budget.
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i use GPW x m2. my typical is around 1.78gpw/m2
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I want more details if I have a 10 million dollar investment.
The key is your chart of accounts in you book keeping.
Everything, what ever metric you pick needs to tie back to accounting.
Gram per meter over what? Time? You need an axis point to pivot the calculation. Grams per meter per week? Then I can compare yields per week. And tie the inputs from both fixed cost and variable cost back to the crop.
The question is of granularity. I can only account to my least accurate measurement.
I want fine granularity in my cost accounting for the grow. Bonus, can be more easily be calculated.
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Well yeah of course time. total time is usually 120-150ish days. But time is faster and slower. each grow has ots own time. so for me it is a fluid time scale based on how fast that two meter squared gets filled. some trays have filled much faster. a lot of the time spent in veg is usually me helping direct the plant. which by different metrics can adjust gpw formulas.
mpxh Man Power x Hours
---------- over
GPW ??
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Bonus, can be more easily be calculated.
What is it? im interested in learning!
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Here is the key the fixed cost for the space did not change. But the time metrics did change. So how do you account for the time matrix, in the grow?
This is where having units of time in week. Allows you to account across the different crops to get a metic of grams per meter week. You can overlay any other accounted for value to the crop. Such as watts of input. I used and averaged 200 k watts per week, this is a number we tracked every week was electric usage. Exact kwatts from the meter. how did this affect the output of my grams per week.
I need to account at a very fine details.
As I said quickbooks and a great chart of accounts.
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