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Tier 1, 2 And 3 Licenses: What Do These Labels Mean, and Why Does It Matter?

When Washington’s recreational cannabis legislation (I-502) passed, it included the Tier system to allow an even playing field among small, medium and large farms—hence, Tiers I, II and III, respectively…

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We see it all the time—a grower classified, for example, as a “Tier II producer from Bellingham.” But what does that really mean?

When Washington’s recreational cannabis legislation (I-502) passed, it included the Tier system to allow an even playing field among small, medium and large farms—hence, Tiers I, II and III, respectively. The following graphics illustrate some of the main differences between the Tiers, and the pros and cons of each.

Please note, this is not intended to characterize individual growers or put anyone into a box, but rather can act as a general guide, and encourage you to learn more about the people behind the product.

Tier I

Basic Info:

  • The smallest farms, with canopies up to 2,000 square feet.
  • Almost always feature indoor grows.
  • Frequently used by small medical growers to transition to recreational.

Pros:

  • Often experienced in growing medical marijuana.
  • Artisanal approach with exceptional quality, often grown sustainably and organically.
  • Typically small family businesses who have served the community for years.

Cons:

  • Higher quality means higher prices.
  • Smaller harvests can sell out quickly.
  • Extremely difficult to maintain competition with larger growers.

Takeaway:

Tier I growers are a great choice for those who want to support local, sustainable family farms that produce connoisseur-grade cannabis.

Tier II

Basic Info:

  • Mid-sized canopies ranging from 2,000 to 10,000 square feet.
  • Usually feature indoor grows.
  • Often family farms, or local partnerships with more financial backing.

Pros:

  • Experienced growers and long-standing members of the cannabis community.
  • Balance of quality, sustainability and high production volume.
  • Community-minded farms passionate about cannabis and keeping business local.

Cons:

 


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  • Difficult to compete with the lower prices offered by Tier III growers.
  • Small margins make running a larger, more complex operation risky.
  • Staffing and management can be difficult for those new to the business.

Takeaway:

Like Tier I, many Tier II growers are very rooted in their communities, and rely on the local economy for survival. Tier II growers have the advantage of being able to offer lower prices, due to higher yields and greater efficiency.

Tier III

Basic Info:

  • The largest canopies, from 10,000 to 30,000 square feet.
  • Mix of outdoor, indoor and greenhouse. Most outdoor farms are Tier III.
  • Some represent large corporations or conglomerates with out-of-state financing.

Pros:

  • Usually lower prices and consistent availability.
  • Outdoor and greenhouse farms that grow organically often produce a low carbon footprint.
  • Robust marketing and branding campaigns.

Cons:

  • Corporate “mega-farms” can drive prices so low, they make competition difficult.
  • Large indoor farms are more likely to use pesticides.
  • Some import their CBD, terpenes, fertilizers, pesticides, etc. from abroad, cutting out the local economy.

Takeaway:

Tier III farms often offer high volume and low prices. And while many are large, profit-driven corporations, others are family farms who use organic growing methods. Regardless of Tier size, no two farms are exactly the same. We strongly suggest you read up and learn as much as you can about who’s producing and processing your cannabis.

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