The legal marijuana market is booming. There’s legitimate money to be made in weed, without having to sell it on the black market to reap the benefits. With more states passing cannabis legislation all the time, there is opportunity abound when it comes to starting a successful cannabis business . Individuals interested in large-scale cultivation are typically curious about the average cost of starting a cannabis grow. Understanding the startup costs of a cannabis grow is paramount to anyone beginning this (extremely lucrative) business venture. According to data published in 2017 in the Marijuana Business Factbook, the average startup costs for people interested in the wholesale cultivation of cannabis is $42/square foot.
How Much Does It Cost to Start a Cannabis Grow?
Don’t forget the licensing fees associated with the state you plan to grow in. In Colorado, for example, state fees for retail marijuana cultivation are $4,000. In California , a recent report found that only around 1% of growers are licensed because they can’t afford licensing costs. Annual fees for a “medium indoor” grow average almost $78,000.
Feeding your plants the nutrients they need is vital for maximizing your harvest. Different nutrients are needed throughout the lifecycle of the plant. While cost will all come down to how much cannabis you’re cultivating, you can plan on spending up to $1,000 or more on nutrients each harvest.
Indoor cultivators produce year-round and can generate between 1 and 12 harvests per year. Main indoor cons include:
How Much Does it Cost to Grow Cannabis Indoor?
We offer The Cannabis Cultivation Financial Model which is a fully-functioning Excel financial model that uses a mix of assumptions to estimate cannabis yields, all revenue and cost line-items monthly over a flexible seven year period, and then sums the monthly results into years for an easy view into the various time periods.
Good lights are one of the most important factors when growing cannabis indoors. You can achieve yields of around 1.3-1.5 gram per watt of light.
Thus, the direct cost of growing the cannabis will be around $180,700 or $516 a pound (42% of wholesale price). It doesn’t include administrative, marketing, distribution costs and taxes, which varies depending on the location.