I remember sitting across from a fellow operator at MJBizCon last year, both of us nursing burnt coffee and staring at our P&Ls.
“I don’t know how much longer we can keep doing this,” he said. He was in Michigan. I was in Washington. But the pain? Identical.
When I heard that TerrAscend—owners of Gage and Cookies in Michigan—was pulling out of the state, I wasn’t surprised. I felt something else: vindicated. Because I’ve been anticipating this for a long time. And if you’re into cannabis, you’ve probably thought it, too. (Hang in there, we’ll get to the automation portion in just a minute.)
Margins are thinner than rolling papers. Labor is unpredictable and expensive. And if you don’t scale smart, you don’t scale at all.
So what went wrong for a company like TerrAscend—one that had the cash, the brand names, and the footprint? And more importantly, what can you do differently to survive this market or even thrive?
Let me break it down for you—one real story, one clear strategy at a time.
Michigan Didn’t Fail TerrAscend. TerrAscend Failed to Adapt.
First off, Michigan isn’t a “bad” market. It’s a tough one, yes. But tough markets reward smart operators.
The problem? TerrAscend went all in on real estate, labor, and scale without efficiency.
They bought up Gage, Cookies, and Pinnacle Emporium locations. That’s over 20 dispensaries, numerous grow operations, and four processing facilities. Sounds impressive—until you realize that retail flower prices dropped below $70 an ounce. Wholesale margins vanished. They spent over $500 million building an empire in a collapsing economy.
Now, they’re laying off 21% of their workforce and dumping their assets.
Sound familiar? If you’ve ever staffed a pre-roll line with eight people and still couldn’t hit consistent margins, you’ve felt this.
Real Talk: Labor Costs Will Bleed You Dry
I remember running a manual pre-roll line with six people. We thought we were saving money by avoiding automation.
But we weren’t. We were losing it.
Every time someone called out, messed up the fill weight, or slowed down production, it hurt. Wages went up. Turnover got worse. Our cost per joint was way too high. So, we finally made the jump to automation.
With STM’s Mini-RocketBox and Atomic Closer? Two people did the job of six. Consistently. Accurately. No drama.
TerrAscend never made that pivot. They kept throwing bodies at a broken model.
Oversupply Isn’t Your Enemy. Inefficiency Is.
You can’t control the market. But you can control your costs.
Michigan’s got too much flower. Too many pre-rolls. Not enough demand to justify the prices. I get it. However, here’s the thing: operators who can produce efficiently still make a profit. Why?
Because automation lets them survive where others drown.
Take infused joints. Everyone wants in—but they’re labor-heavy, slow to make, and hard to scale by hand. With STM’s Astro Infuser, I’ve watched teams go from struggling to output 500 a day… to knocking out 5,000+ with no extra headcount.
And it’s not just the machines—it’s the system. STM’s gear is modular, easy to clean, and low maintenance, making it fast to train on. You can swap SKUs, test new products, and keep up with market shifts.
That’s your moat.
What Happens When a Giant Like TerrAscend Exits?
Short term? Some prices might stabilize. You might even think, “Hey, one less competitor.”
However, in the long run, investor confidence tends to decline. Consolidation kicks in. And if you’re not efficient, you’re next.
Operators like you—scrappy, local, trying to do it right—are who I believe in. But only if you set yourself up to win.
The math is brutal in this business. You can’t afford to make decisions based on old strategies. You need systems that grow with you rather than draining you.
That’s where STM Canna comes in. And I’ll walk you through exactly how it works.
The Real Cost Breakdown: Why Manual Pre-Rolls Kill Your Margins
Let me walk you through the math I had to learn the hard way.
We used to pay around $18 per hour for a line worker. Let’s say you run a five-person pre-roll team. That’s $90/hour just in labor—not even counting taxes, training, breaks, or turnover. Run that team for 8 hours? You’re out $720 a day. And on a good day, they might get out 3,000 joints—assuming no one screws up.
Now stack that against one STM Mini-RocketBox and Atomic Closer, which can crank out that same volume—or more—with just one operator and a helper. That machine doesn’t get tired. Doesn’t call out. Doesn’t ask for a raise.
We cut labor costs by 60%. Reallocated staff to packaging and QA. And guess what? We got better product consistency at a lower cost per joint.
I’m not saying machines replace people. I’m saying they let your people do more of the things that matter—and stop bleeding cash on the things that don’t.
Modular vs. AiO: What Most People Get Wrong About Equipment ROI
When we were first shopping automation, someone pitched us one of those all-in-one machines.
You’ve probably seen them. Giant, expensive, takes up a ton of floor space, and promises to “do it all.” Sounds great, right?
Wrong.
What they don’t tell you is that the maintenance costs are brutal. You’re locked into their proprietary parts. If one section fails, the whole line stops. And forget switching between SKUs or cone sizes quickly—it’s a nightmare. We almost made that mistake.
Instead, we went with STM’s modular setup.
Here’s why it mattered:
- We started with just the Mini-RocketBox and a Closer.
- As demand grew, we added more Mini-Rocketboxes. Several Mini’s can feed one Closer and produce up to 20,000 pre-rolls a day.
- Cleaning? Took us 10 minutes a day, tops.
- Switching between 1g cones and dog walkers? Easy.
- Maintenance? We could have done it ourselves—and when we needed help, STM’s U.S.-based support was there to answer the phone.
Modular gave us control. Flexibility. And a clear upgrade path as we scaled.
That’s the kind of ROI you can build a business on.
How STM Helped a Michigan Operator Go from Breakeven to Profitable
Let me tell you about my buddy Mike.
He runs a small mid-Michigan brand right outside Lansing. Like many local operations, he was surviving, not thriving. His infused pre-rolls were popular, but production was a bottleneck. Labor costs were eating him alive, and he couldn’t hit the volumes dispensaries were demanding.
He switched to STM. Started with a Mini-RocketBox and Closer. Didn’t even need to hire anyone new—just retrained two existing staff.
In three months, his output tripled. Returns dropped. Consistency went up. He negotiated better wholesale deals because he could deliver larger, more reliable volumes. And for the first time in a year, he posted real profit. He now runs 5 Atomic Closers.
That’s what intelligent automation does—it turns stress into strategy.
Why You Don’t Need to Add Labor—You Can Repurpose It
Here’s the lie: too many cannabis operators are sold, and scaling means hiring more people.
But it doesn’t. Not when you have the right systems in place.
When we added STM machines, we didn’t lay anyone off. We just moved them to better roles. Instead of hand-packing cones or twisting tips, they were running QA, managing inventory, and even overseeing R&D.
Some of them were stoked. One told me, “I feel like I’m learning something now.”
And because the machines are simple to clean and run, even new hires could be trained in under an hour.
You don’t just save money—you build a better team, too.
Financing, U.S. Manufacturing, and Service That Answers
Let’s discuss risk for a moment.
Investing in new equipment can be intimidating, especially when cash flow is tight. I’ve been there. That’s why financing options mattered to me.
STM didn’t just sell me a machine—they worked with me to make sure I could afford it. Payment plans. Flexible terms. No predatory nonsense.
And when I needed service? I wasn’t sent to a call center halfway around the world. They are staffed in Spokane, Washington, and Tampa Bay, Florida.
STM designs manufactures and services everything right here in the U.S. I’ve visited their facility in Spokane. Real engineers. Real people who know what the hell they’re doing.
And their client services team? Lifesavers. They walked me through calibration at 7 pm on a Friday.
You can’t put a price on that kind of support.
Final Thoughts: Don’t Wait for the Market to Get Better. Get Better First.
Look, the truth is, the market may not bounce back the way you hope. At least not fast.
But that doesn’t mean you’re out of options.
If you’re reading this, you’ve already got the grit. The hustle. That’s the reason you got into this crazy business in the first place.
Now, all you need is the right system to scale without burning out—or burning cash.
TerrAscend bet big and lost because they scaled wrong. Too much real estate. Too much labor. Not enough lean thinking.
But you? You can learn from that.
I did. Mike did. And so can you.
So, if you’re ready to get off the hamster wheel and start scaling smarter, let’s talk. I’ve been where you are—and I know the way out.
Worried You Might Be the Next TerrAscend?
You don’t need $500M to win in cannabis. You need the right system.
Let’s show you how STM can work in your facility.
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– Casey Monroe
Casey Monroe is a cannabis industry writer with a knack for storytelling and strategy. With a background in manufacturing, marketing, and tech, Casey brings a grounded, results-driven approach to every piece—whether it’s a deep-dive blog post or a punchy thought leadership article. Obsessed with efficiency, scale, and staying ahead of market shifts, Casey helps brands speak with clarity, authority, and purpose. Based in the Pacific Northwest, Casey spends off-hours trail running, experimenting with low-carb recipes, and researching emerging trends in automation.
