What is DTC?
Direct to Consumer or DTC is a business model where brands or manufacturers sell their products directly to consumers, bypassing third-party retailers, wholesalers, or middlemen. In agriculture, the farmers market economy is the most common form of DTC. Community Supported Agriculture programs or CSA's are a growing sector of DTC Agriculture as well.
In many regards, DTC is what makes small to medium scale agriculture financially possible. In regulated Hemp, I and many other farmers are able to sell our flowers and finished products directly to consumers through e-commerce, farmers markets and store fronts. This business model typically provides a higher quality product at a similar or lower cost to consumers.
The New Story of Hemp in America
If you have operated a TRUE Type 3 and Type 4 farm over the last 4-6 years, you have seen a market grow, over produce, choke itself out, and mutate to survive. No limits, low entry cost and a few CNN episodes persuaded the whole country to blow out the back 40 with hemp for CBD extraction. A true free and open market with no customer data to predict the market size. A perfect storm for over production.
I knew from being in the medical turning recreational cannabis industry in Washington State that you should only grow what you can sell. Whether it's field grown or indoor hydroponics, cannabis has production cost and shelf life. If it doesn't sell, or is liquidated at or below cost, the farmers take the biggest hit.
Relying on middle folks and third party retailers takes away the farmer's control of price and "demand". In the early days of Washington Medical Cannabis, farmers markets and farmer owned stores thrived. Farmers could bring their craft to the table, sell direct to consumer, and maintain a sustainable profit margin. You could work harder, and profit more. If you experienced this era, consider yourself blessed.
In 2019, I saw the writing on the wall. A flood was coming that even Noah would want a life jacket for. I saw indoor hemp farmers taking wholesale prices that would put them out of business, thousands of acres of biomass and a consumer market that was barely a fraction of its sister market, THC.
For me the only way to keep the lights on was DTC and staying small, independent, and lean. And thats why I am here in 2025. Had I gone the route so many did, MFH would have died on the vine. Now that the flood of CBD has come and gone, I believe the market is leveling off at a sustainable threshold. The amount of production is appropriate for the consumption, prices are fair and the competition is tougher than its ever been.
I often compare myself and other DTC growers to Soundcloud rappers. In theory, there's thousands of us with pretty similar barriers to entry. Were all trying to capture the attention of someone looking for something that not many others are looking for. Were all doing the same thing, but with our own style and bars. Some of us make our own beats and others go the Drake route. In the end it is all art, and that is beautiful.
I like to think we are living the American hemp farmers dream.
The Future of American Cannabis
As Cannabis and Hemp regulation evolve, it will be no different than all other sectors of agriculture in that DTC will be the only way for small independent farmers to maintain value and economic resilience. In regulated THC states this is often referred to as vertical integration, as the retailer, processor, and producer are all integrated and operated by one company or individual. This can often cost more in licensing or be prohibited all together. This takes power away from the farmer and increases the amount of hands involved. The margins are decreased, which ultimately comes out of employee salaries as decreased wages. Quality is often lost, and price is the same or higher than DTC. Lobbyist and those they are paid by are the only ones benefiting from not allowing DTC Cannabis sales.
When it comes to voting or discussing full legalization, this is often left out. It's a concept many consumers are unaware of in their daily life, even if they shop at the farmers market and farm stores. That is why I am ending on the note that you should not only look to source your Cannabis and Hemp products directly from farms, but your food as well. That is how you vote with your dollar and support agriculture products that support you.
That is why direct to consumer cannabis of all types is the American dream.
-Will
0 comments