customer story

Grasshopper Farms Recoups $70K and Secures Financing

How Grasshopper Farms gained $100k+ in financing and eliminated manual procurement errors with Order.co.

 

Grasshopper Farms at a Glance

950+

products loaded in 1 platform

$100K

in financing

$70K

in payment protection

Grasshopper Farms: Proving the value of sun-grown cannabis

Building a cannabis cultivation farm from the ground up and expanding it to multiple locations requires assembling the right team, growing a premium product, and harnessing resources that are built to scale. Just ask Will Bowden, CEO & Founder of Grasshopper Farms. 

Will’s journey in the cannabis industry began after serving in the military for twenty years. His passion for working outdoors combined with his interest in sustainable cannabis farming drove him to ask a critical question: Why does outdoor flower have a reputation for being lesser quality? “When you go into retailers, you would see different grades of indoor flower and the price would be marked accordingly,” Will shared. “But when it came to outdoor flower – if it was even available in a retailer – it usually was only one grade and it was usually appreciated as a lower grade.”

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With a mission to produce premium sun-grown flower of a higher quality than what existed on the market, Will founded Grasshopper Farms and opened his first location in Paw Paw, Michigan. He built a dedicated team of local farmers with over 60 years of combined expertise and spoke directly to both cannabis retailers and consumers to ensure that they were indeed producing a product that exceeded expectations. For four years in a row, Grasshopper Farms sold out of their products. 

After consistently enjoying successful harvests in Michigan, Will expanded his business into a multi-state operator (MSO) with a 48+ acre farm in Colorado and a 40+ acre farm in New Jersey. “We've had two harvests out in Colorado,” Will said. “The market has come back to us with unsolicited feedback saying that it is a higher quality outdoor flower, and we're just about to be plant touching in New Jersey. Our goal is to go into the market space and to go into ten different states.” Such rapid growth prompted Will to reassess his existing processes and their ability to scale with his business.

The Challenge

Vendor management complexity: Difficulty securing supplier relationships in the high-risk cannabis industry

Financing constraints: Industry bias and banking restrictions limited their access to financing

Manual purchasing processes: Inventory and procurement management were tracked in spreadsheets

Due to the nature of the cannabis industry, Grasshopper Farms faced roadblocks in their efforts to secure reliable supplier relationships. “Any supplier is gonna be looking at all of their sales as they're gonna assess risk,” Will explained. “And our industry inherently has risk right now because it's a volatile industry.” Suppliers often avoid working with cannabis businesses, even if they’re simply looking to purchase shopping bags or cleaning supplies. As a result, they miss out on the competitive pricing, supply chain efficiency, and consistent product quality that ongoing vendor relationships offer. 

Since the business started, the Grasshopper Farms team tracked all of their orders in spreadsheets. Working in spreadsheets served them well for years and offered full visibility into their finances, but it became difficult to manage as the business grew. “Even though spreadsheets are great, they require a lot of manual typing.” Will shared. “You’re never 100% error-free when you're free typing into a spreadsheet.” Errors in procurement management can snowball into significant problems, including inaccurate stock levels, fragmented data, and delayed decision-making – all of which could negatively impact cash flow. 

“You’re never 100% error-free when you're free typing into a spreadsheet.”
Will Bowden Founder & CEO

For the cannabis industry, maximizing cash flow is particularly critical given their restricted access to loans, lines of credit, and traditional banking services. “The federal government said that if any bank wants to get involved [with cannabis businesses], here's your set of rules,” Will explained. “We do have state banks that are participating but even state banks aren’t gonna give you the financing. Some of the folks who are specializing in cannabis lending offer percentage rates that are pretty high.” 

Facing red tape that had the potential to stunt Grasshopper Farms’ growth significantly, Will met with the Order.co team in 2022 to simplify their procurement processes and gain the cash flow he needed to reach his business expansion goals. Will shared, “When we started to investigate whether to partner with somebody for procurement management, Order.co ended up being that solution.”

The Solution: Overcoming cannabis industry bias with centralized procurement 

After a brief trial period of exploring the Order.co platform, Will decided to move forward and begin migrating their existing manual processes to an automated, centralized procurement software. The spreadsheets his team had utilized to track their purchasing needs thus far turned out to be an invaluable asset. “When you start to partner with someone like Order.co, bring spreadsheets with you,” Will said. “You go through an onboarding process of looking at your purchasing patterns, and that's gonna help Order.co to help you.”

Once Order.co was fully incorporated into their workflows, Grasshopper Farms unlocked several key benefits that had an immediate impact on their business. With automated procurement workflows and $100k+ in financing at their disposal through the platform, cash flow became easier to manage. Grasshopper Farms’ options for supplier partnerships also expanded significantly overnight through Order.co’s 15k+ vendor network. “If you can use Order.co to pay for things, that's going to put your suppliers in a better position to agree to sell you something,” Will shared. “Collecting payment from Order.co is gonna be less risky than working directly with an operator.” 

“If you can use Order.co to pay for things, that's going to put your suppliers in a better position to agree to sell you something.”
Will Bowden Founder & CEO

With a centralized procurement platform, Grasshopper Farms now not only had more vendors to choose from but also an extra thirty days to pay them with net terms. “You're gonna order something through Order.co, and they are gonna take care of the terms with the supplier it comes from, and then they're gonna define terms with you as well,” Will described. “Being able to have those terms is a really powerful tool, and that's gonna help you to feel more comfortable with your cash flow and profitability.” 

The Outcome

Recouped $70k lost to a supplier bankruptcy

Working with a centralized procurement system came with unexpected benefits. When Grasshopper Farms ordered equipment from a supplier that ended up filing for bankruptcy, they were left with a significant problem. “We had placed an order through Order.co to a supplier,” Will explained. “That supplier ended up filing for bankruptcy, and we were actually able to recoup the $70k that we had paid them for equipment that we never received because Order.co took care of it.”

“We were actually able to recoup the $70k that we had paid [the supplier] for equipment that we never received because Order.co took care of it.”
Will Bowden Founder & CEO

Dealing with a bankrupt vendor and losing $70,000 had the potential to cause hours of hand-wringing for Grasshopper Farms. However, since they had Order.co on their side, they didn’t have to lift a finger. As a result, Will and his team avoided hours of back-and-forth vendor communications and even legal battles, allowing them to redirect their focus to what they do best: growing premium flower in the sun. 

Simplified vendor management processes

Negotiating with vendors, sifting through emails to find order tracking information, and handling returns is a time-consuming process for any business. With a trusted vendor management partner on Grasshopper Farms’ side, this became a headache of the past. “Order.co takes over the negotiating of pricing and terms with vendors, and you're still ordering all the exact items you want,” Will said. “It's just now, you have a partner who's gonna go out there and give you terms as the operator. So, you can operate with them independently of that supplier.”

The Grasshopper Farms team also enjoyed using AI-powered sourcing through Order.co. With thousands of suppliers available in one system, the software can identify better prices and faster shipping for the same products that they had already been buying. “If you tell somebody at Order.co that you wanna be able to source something from a particular vendor or an item that they have to go find, they actually do the work for you,” Will shared.

Harnessed reporting for 100% spend visibility

As Grasshopper Farms continued to expand, tracking and analyzing spending across locations became essential. Leveraging Order.co’s reporting tools, Will and his team could easily see spending breakdowns by supplier, department, and farm. “For us to be able to organize our cost of goods either across those products or attached to one of those products, that's what a procurement platform is going to help you to get very detailed in,” Will highlighted. “And that's gonna help you to know your numbers even better.”

“You can analyze [your business] per location or across the enterprise,” Will explained. “You're gonna find that that's gonna be helpful reporting for you.” With this level of spend visibility, Grasshopper Farms is better equipped to scale their operations, optimize costs, and maintain the financial health critical to thriving in the cannabis industry. 

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