Katrina and Rob McKinley have heard plenty of the rumors over the years.
“People say they find all sorts of stuff in our products that doesn’t belong, that we’re in the Mafia, that we have a whole bunch of helicopters, that we’re always fixing prices and all sorts of other crazy, untrue things,” said Katrina McKinley, Chief Operating Officer for GrowOp Farms, a cannabis producer based in Spokane Valley.
Some criticism and rumor-mongering is natural, especially when a company is at the top of the food chain in a new and competitive industry. GrowOp Farms is the largest cannabis grower in Eastern Washington and the second largest in the state. According to 502data.com, which tracks industry sales statewide, the company has seen sales exceeding $53 million since 2014, and has posted monthly sales in the $1.5-$2 million range since summer 2016.
The McKinleys want the world to know that they don’t have swimming pools full of money, and actually put all profits back into the company, mostly in the form of infrastructure and payroll.
“We started in 2014 with $2 million, and we’ve re-invested millions into this company since then,” said Rob McKinley, CEO. “Payroll alone is $1 million a month. We’re still running paycheck to paycheck.”
As of early April, GrowOp Farms employs about 420 people at the former Walker’s Furniture warehouse in Spokane Valley. Shifts run around the clock growing and cultivating plants, preparing products to reach retailers around the state, and researching and developing new strains.
“We have 60 people whose only job is just to keep everything clean, and they go over the whole place at least once every 72 hours,” Rob said. “We pride ourselves on the number of jobs we’ve created here – we want to create a good experience for everyone.”
The company owns two Tier 3 licenses, which allow growth of up to 60,000 square feet of plant canopy. It’s best known for Phat Panda premium marijuana strains and products, but also offers Sticky Frog concentrates and oils; and Hot Sugar, which includes infused sugar and flavored candies.
GrowOp Farms is currently growing about 80 strains of cannabis. Some are customer favorites, such as Golden Pineapple and OG Chem, but new strains are regularly being introduced, such as Wedding Cake, MAC, and Hawaiian Golden Pineapple, a cross between Golden Pineapple and Puna Budda.
Because GrowOp Farms continues to thrive while some smaller processors face challenges, many in and out of the industry regularly ask what the company is doing differently?
The McKinleys say it starts with a constant focus on quality and consistency. Customized computerized systems in every grow room keeps track of soil, temperature, humidity, plant yield and other factors, so conditions can be duplicated exactly for future planting of the same strain.
Grow rooms use dual-spectrum HPS and metal-halide lights with varying intensities for better growth and larger yields. They also find ways to use stems and other plant material in other products, instead of harvesting the buds and disposing of the rest.
“For our first rooms, we asked ourselves, ‘When we have more money, what would we change?’ and when we did make more money we started retrofitting everything,” Katrina said.
Since the beginning, GrowOp Farms has also worked to set its wholesale prices slightly lower than competitors which appeals to budget-conscious retailers while creating strong relationships. The goal is that no store shelf is ever empty, which would lead to customers choosing another brand.
Trade publications have compared the company to food/drink giants like Kraft, Kellogg or Budweiser, based on the large-scale operation and high demand. The McKinleys don’t deny the parallels.
“We do want to sell a lot, and we want to sell the best products at the best price,” Rob said. “We really created the market, found where the good price was and keep on adjusting.”
The McKinleys are also always on the lookout for collaboration opportunities. Some producers grow cannabis that goes out under the Phat Panda name and label, others pay to use the company’s processing facilities and staff for their own products.
They constantly search for new seeds, especially strains with unique phenotypes and other characteristics that aren’t in circulation locally or may still be in the possession of growers who have closed their doors.
The company is focusing on adding new candy lines this spring. It purchases sour rings and sour ropes from a candy maker in California, and then infuses them locally to sell in Washington as FLAV. They are also making High Chews, their own blend of infused candy using Hot Sugar.
The interest in collaboration extends to working with several municipalities. They have given tours to Spokane Valley city council members to educate them about the production process, and have worked with Spokane Clean Air Agency to help develop odor control standards, plus local fire departments to create safety protocols. They maintain a good relationship with the Liquor and Cannabis Board for any enforcement questions or citizen complaints.
And while all growers are required to send samples of each strain or product to independent labs for quality testing, GrowOp Farms goes beyond this.
“We independently test every harvest for pesticides using Trace Analytics,” Rob said. “We are the only farm in the legal 502 market to do this for the peace of mind of the consumer. The state has also periodically collected samples for testing, which we have never failed.”
The McKinleys have another secret ingredient: their employees.
The company started small, with less than 30 team members. Today, with more than 400 working 24/7, the need for constant employee satisfaction remains high.
“We like to make them happy,” Katrina said. “These guys really work their butts off,”
Perks are big: lunch is brought in at least three days a week, and there are plenty of donuts to go around on Monday mornings. Massages are also provided regularly.
Employees can buy Phat Panda apparel at cost, and though they can’t legally partake of cannabis at work, they can bring home product samples at the end of each month.
“We’re always having parties, and even do family events like renting out Splashdown,” she said. “We want everyone to be friendly and all be part of the Phat Panda family.”
Some employees can move to different positions as needed, while others like to stay in the same role.
They’re also working on developing a 4-10 shift, which will provide an extra day off each week along with reducing overtime costs.
“Everyone is really tight-knit,” she said.
Katrina and Rob remain appreciative of everyone’s efforts and how much the company has grown.
“Unlike some growers, we never were involved in any of this before it was legal,” Rob said. “We ran a marketing company and helped start-ups, but friends told us that we should start growing. So we started by asking a lot of questions and learning fast.”
Revenue from their marketing businesses allowed any GrowOp profits to go back into the company.
Much of the company’s success comes down to their own curiosity and that was in place even before their first seed was planted.
“We really started as a marketing company and we’re still doing that,” Rob said. “We have a little different perspective.”