Lars Meijer from Codema Systems Group shares how the top cannabis companies are using automation to radically increase efficiency and profit. Cultivators not thinking this way will be left behind soon.
– Mapping out the lifecycle of your plants
– Creating a workflow
– Building automation around your workflow
– How moving and flying tables enable efficiency
– Reducing input costs
See Codema’s Solutions Videos Here
Matthew: The lion's share of profit in cannabis cultivation will go to the producers that make top shelf cannabis efficiently while maintaining profit margins. So, how does a cultivator become more efficient? It starts with automation and process planning. Here to help us understand more about efficiency in the grow room is Lars Meijer of CODEMA Systems Group. Lars, welcome to CannaInsider.
Lars: Thank you. So now, I got to be a guest on CannaInsider. Matt, thank you.
Matthew: Give us a sense of geography. Where are you in the world today?
Lars: Well, our company is based in the Netherlands and in a small town called Bergschenhoek. And for most people more aware with the Netherlands is near Rotterdam.
Matthew: Okay. And I'm in Lisbon, Portugal today.
Lars: Oh, wow.
Matthew: Yeah. Probably a little bit sunnier than the Netherlands.
Lars: It is, yeah.
Matthew: Yeah. There's a lot of people from Sweden visiting Portugal right now. They said it's already like late autumn there. So they're getting their final sunshine in before returning to the Great White North.
Matthew: But I know you're in the Netherlands. Okay. So let's go here. What is CODEMA Systems Group at a high level?
Lars: Yeah. The CODEMA Systems Group provides automation every essential part inside the greenhouse. So this means for the cultivation systems, logistical side in the greenhouse, water treatment/irrigation, but also software for growers.
Matthew: Okay. And we'll get into the details of that in a minute. But first, tell us a little bit about your background, Lars. How did you get involved in this industry?
Lars: It's actually a quite funny story. When I was young, I studied to become a pilot. I am licensed. But in the past, it was very difficult to get a job in the aviation industry. But in, yeah, where I grew up in a notorious area called Westland, and that's a big part in the Netherlands with a lot of greenhouses. So when I was young, I also worked inside the greenhouses. And therefore, I really liked the business since I was already young. So that's how I...yeah, Instead of flying, I got into cultivation.
Matthew: Oh, cool. I guess there's a lot of similarities because there's a lot of checklists and details that have to be just right. And with what you're doing now with cultivation, there's a lot of details and things that need to be just right in order for takeoff of the plants to happen, a little slower process, but [crosstalk [00:02:48].
Lars: Yes, the growers are getting more and more sophisticated and more higher level than from the past. So, yes, there's a lot of similarities, yes.
Matthew: Well, let's go over how this type of automation improves things. Let's start with energy. How do CODEMA's tables reduce energy cost? And maybe before we do that, maybe just...I'm saying tables and you might say tables or containers, maybe just make a visualization of what you're talking about exactly when we were talking about tables, and why it's important for a cannabis cultivator to think about having tables or containers in their grow operation?
Lars: Yeah. I think, first of all for every grower, you wanna get the highest efficiency for your square meters as possible. And with our containers, that's what we call them, could be completely automated. And when you want a high-level automation, we can create it with containers. It can be moved automatically throughout the grow zone of the greenhouse or a multilayer grow zone. It doesn't matter. And our containers are like an aluminum frame and they can hold like a plastic bottom tray, which can be filled with water like an ebb flow system. So the water rises a few centimeters, and it flows out automatically of the container again. And this way, the crop on the container can retrieve its water through its roots. And there are, like, three options you can handle these containers: manually, semi-automatic, or fully automatic.
Matthew: Okay. And so they're kind of like manageable workspaces, these tables. And how big is your average table?
Lars: Yeah. Like it says, we are a custom-made company. So we can do whatever the customer wants but it mostly depends on the base size of the greenhouse. So for example in the base like eight meters wide, we usually take a container a little bit less than half of the base. So we get two tracks of containers inside one bay.
Matthew: Okay. Yeah. So you have these, I will call, manageable workspaces in the table or container, we'll just call them tables. And then there's a design automation where you plan out the whole seed cycle process, and these tables kind of move along like a conveyor belt or an assembly line in an auto manufacturing where the whole process has been thought out and these tables go where they're supposed to when they need to, sometimes even being picked up in the air and moved from one place to another. Do I have that correct?
Lars: Yeah, that's completely correct, yeah. And there are like lots of different ways to handle those containers. But, yeah, those are a few examples. Yes.
Matthew: Okay. Okay, now that we know what the tables or containers are, let's start with why they're important. And maybe talk a little bit about energy. How do CODEMA's tables reduce energy and cost, energy cost specifically?
Lars: Well, I think energy cost isn't the most drastic one because, of course, energy is very important. But those can be more being achieved through solar panels or other ways. And I think the reduction of our system...I think implementing our system is a reduction in the labor cost. I think this one is the most important one, because you don't want any employees or workers inside the grow area.
So handling the containers or, yeah, what you said, the tables or the moving working areas, they can just handle the...they can move inside the greenhouse by itself, and then they go to the work zone where the employees can work on the tables. So they can harvest, they can remove anything, they can clean the containers, and whatever. So I think the reduction of labor is the most important one.
Matthew: Okay. So reduction of labor, keeping people out of a working area is important because humans bring in spores, and bacteria, and all these different variables that are hard to plan for. So when you say labor cost is the most important, how do you walk through a prospective customer on, like, how much less labor they need once they implement a system like this?
Lars: It's very difficult to make it like a hard number. But sometimes, we try to make a calculation with the customer how many plants he is handling at the moment when he's doing it by hand or by a forklift truck. And then we calculate with our capacity how many plants we can handle with our system. And sometimes this may even triple the amount of plants he can handle. So that differs for every greenhouse, and every project, and we calculated each time again.
Matthew: Okay. Okay. So it's very customized. There's no one answer. Maybe, has there been a client in the last year that has told you how much they've been able to reduce labor cost, like any specific examples?
Lars: Yeah. He said, I think it reduces workers, which is hours for like 60% or 65% of his workers, yes.
Matthew: Wow. Wow. And not just that, it's just that it's so repeatable and predictable. When you give like a request to employees, "Hey, go do this, or this." Or, "Start to plan harvest," to do, or that, it's just not as predictable because all these things for human to human communication, there's a lot of things that are lost, interpretation. And when you boil things down to a physical automation process, there is an objective way of seeing how your seed to harvest is gonna happen in a very predictable way that takes some stress and anxiety out of the process, I think.
Lars: Yeah, yeah. And like you said, machines don't make mistakes because we program them the way we want them to work. So yeah, for example the plants are on the table and you always want like, for example, five centimeters apart of each other, a robot always does the five centimeters. And if an employee does it, it might be six centimeters, or four and a half, and it maybe doesn't give the right uniformity in plant growth. So yeah, that's totally correct what you were saying, yeah.
Matthew: Well, let's talk a little bit about error rate like you just mentioned, you know, getting the right measurements. What other measurements do humans make that are then replaced by CODEMA's system? So water, movement, what other things? What kind of measurements and error rate is there that you could talk about at all?
Lars: Yeah. So with our also the climate computers and automation of watering, you can always give the same amount of liters of water to every table. And whenever there's like an employee walking around with a hose, he has to count for himself and see with the eye. But that's never so precise as a machine. And that's the same for everything also with climate, temperature, also walking around inside the greenhouse, the employee might not be paying any attention, and he's walking against plants, it falls over, it breaks down, and especially with the cannabis plants they're really sensitive. So that's why you only want the robots, or the drives, the automation to move the containers around. So, yeah, to keep your crop safe.
Matthew: Yeah, okay. How about yield here? I mean, are you seeing increased yield after one of the systems is put in, or is it just more of a uniform yield because you're doing things in such a predictable, methodical way?
Lars: Yeah, I think it's a combination of both because, like I said, you can plan easy ahead because you know how many plants a robot or a system can handle. And an employee might differ because he's sick or he's not so feeling well on one day or the other. And I think also with the uses of square meters increases with our container system. For example, if you're just growing on the ground, you always need some walking space for your employees to walk inside the greenhouse and to work on the plants. Well, that's not needed anymore because the plants come to the working area, to the people.
Matthew: Right, right. That's hard for a lot of people to visualize. Like, "What are you talking about?" Like, these things are connected like on a conveyor belt, and the workers are standing there, and then a table arrives in front of them to do their work.
Lars: Yeah, yeah, it's fully automated. So it's just, you press a button or you sit behind the computer, and you're like, "Okay, this container needs to be harvested." And they're like, and I know two, three, four people standing on a position and the container or table steps by with the plants to be harvested.
Matthew: Wow. Okay. Now, what about if I want to add nutrients to the water for the roots to suck up, is there a way to automate that process too, or does it just have to be done at the water before it's delivered to the table?
Lars: Yeah, that's mostly in combination together with a water company. So yeah, you can store your clean water, you have a fertilizer, or a mixing machine which can clean the water as well, and that's all before it's transported to the tables, yeah.
Matthew: Okay, okay. And how do your systems work with the track and tracing of plants because it's really...you know, in North America, cannabis plants are like plutonium. They treat it like it's the most scary and harmful substance to society. And so everything has to be tracked and traced down to the tiniest detail, while you look at something like alcohol and you can just walk into any store and there's no safeguards, whatsoever, but somehow, this plant it's on lockdown. So what about the tracking and tracing because people are very interested in making sure that, you know, everything gets tracked and traced properly?
Lars: Yeah. I think we got a lot of questions from our current customers for the track and tracing. And in the past, of course, it was needed and it was asked for the growers. But like you said, for now in the cannabis industry, it's way more detailed than it used to be. And what we try to work with was with barcodes. So, in every table, so in every aluminum frame, usually there's a barcode. And in the PC, so in the PC control, you can see wherever the container has been.
So for example, in week five, it was located in bay five, and in week six, it's was located in bay four. And therefore, you can always see what happens to the container. So for example, one of the crop experts walk inside the greenhouse, and it's like, "Oh, wow, this batch isn't good anymore." He can just scan the container and sit behind this computer, and checks, "Okay, well, this isn't a good batch. Just remove it from the greenhouse," and this way, you can track and trace whatever happened to each plant.
Matthew: Okay. So that's software you said that, for example, the person sitting behind the computer, that software comes with CODEMA, with the whole system when you purchase it?
Lars: Yeah. Yeah, it usually does. We always ask the customer what he wants. If he has his own software, it's also fine. But yeah, of course, when you can place it in one company, the whole package, yeah, why wouldn't you?
Matthew: Yeah. Okay. And then how are the systems installed? Is that something that you do together with the customer, the customer does it, how does that typically work? How does that breakdown?
Lars: Yeah, differs per every project actually because each customer has his own wishes. Like, one customer has a lot of employees and technical guys. And he's like, "Well, I can do most of the installation by myself." But some others, they want nothing to do with it. So they just say, "Okay, you got all the responsibility and you have to install it." Well, and in most projects when we are overseas, we use local installation companies which have been working over decades. And so we know that they have our high standards. But in order to check everything, we always send a supervisor. So if we make an installation, for example in North America, then we use local companies to install the system. And then our smart guys for the electrics and the supervisor, they go ahead, and test the system, and check everything is done.
Matthew: Okay, that makes sense. Now, if a business owner was thinking they wanna have one person on staff that has the skills to maintain a system, an automation system, what's a good skill set to have? I mean, electrician fixing vending machines, a robotics engineer, mechanical engineer, what's the type of person, the skill set that's usually most helpful for maintaining these type of systems?
Lars: Yeah, I think you need two. So one mechanical, and one electrical. Those are the two most important ones. And usually when we are done with a project, we try to train two or three people who need to work with the system every day. So for example, like a company leader or one of the management's which has to work with the system every day, we train them as well.
Matthew: Okay, okay. And maybe could you talk about the most common application because there's a lot of growers that will be listening that they have anywhere from, let's say, a 500 square foot grow to a 5,000 square foot grow. And then there'll be some that have much bigger too. But what can you kinda tell them in terms of how this can really help their business, you know, and if they make the decision in the next six months? Because most people have to budget forward, go through the decision-making process. I mean, can you tell us what they get on the other side, what's the biggest benefit they'll feel?
Lars: Yeah, I think the biggest benefit is, like, you get the highest efficiency of your growing area. And for example, if you're just a small grower which is, like you said, a few hundred square meters, we also have other solutions. You don't need the moving tables around. We have lots of other ways for also small growers to increase yields, to raise up the plants so you can work on them with walking heights. And like you said, when you have a lot of square meters, well, then you do it fully automatic. So again, especially in a medicinal cannabis, you don't want a lot of people working, cross-contamination, whatever. So therefore, I think mostly the hygiene and the efficiency of the routing in the plants is the biggest benefits, yeah.
Matthew: Okay. And so when you're spec'ing out what system makes sense with a customer, what does that initial consult look like? How do you map the needs of the customer to then the capabilities of CODEMA systems?
Lars: Yeah, I think when we first start whenever we get a customer, or a potential customer, we ask a lot of questions. And then there'll be like 5 or 10 questions heading to 50 questions. So for example, "What's the floor gonna be like? How big is the greenhouse? What's your automation level you want? What type of crops? What's the crop cycle?" And I think we usually spend half a day just discussing with the customer. And then I go together with engineers, we make first draft of the drawing. Then we go back, I don't know, maybe two or three weeks after. And we have another discussion, so okay, maybe something has changed, he talked with another grower, and he wanted to change the cycle. And this way, depends on how much changes, we make a final plan. And whenever the final plan is ready, then we go into a quote, and etc.
Matthew: Okay. Now, is working with cannabis growers much different than working with the other type of indoor farmers you work with?
Lars: Yeah. It's quite different. Of course, it's...yeah, because it's a medicine and just like with vegetables as well, the hygiene level is way more important than we are used to. Our companies originated from potted plants, so like from the orchids, and other stuff, and green plants. And then a high-level of hygiene isn't very important. So that's I think the most different from our current customers. Yes, the hygiene levels, yeah.
Matthew: Okay. And are there any companies in North America using your tables now that you can mention?
Lars: Unfortunately, due to NDA's signed between us and the companies, I'm not allowed to mention any names. But what I can say is that there are few of the largest growers in the top 10 who are using and are going to use our systems in the future.
Matthew: Yeah. And I do know a few names myself. That's how you came on my radar. So there are some good ones doing that. Okay. Now, where do you see automation and indoor growing in the next five years going...where is it gonna go? Can you kinda tell us where that you think the future is? And I mention that because, you know, in talking to people from the Netherlands, it's funny, there is almost like a...everybody really thinks about cultivation or a lot of people do. You know, most adults I talk to from the Netherlands maybe because they see greenhouses everywhere just kind of have a low-level understanding, just everyday person of indoor growing, and so forth. And then there's, of course, a lot of experts there.
So I think the culture you come from is...you know, in Colorado, we say, "Oh, you know, people from the Netherlands, they're 10 years ahead in terms of their technology." And that's why a lot of times, they go to the Netherlands to try to get solutions. I think it's interesting how the cultures evolve that way. I think it's because...or maybe I should ask you why you think that is, is it because, you know, there's a ton of people in a very small area? And that area is below sea level. And there's just a lot of risk factors that need to be mitigated. So it's something that you're very aware of. Why do you think that is?
Lars: I think that that's a big issue, like we're below sea level, and we're a pretty crowded country here in the Netherlands, and we have always been a very picky or needy people, we're very critic, and also to ourselves, and to the food we eat. So we need food to be clean but it also needs to be good and you're not allowed to use any pesticide. So we're very needy as Dutches [SP] as well. And I think with the multilayer and indoor growing, it's still quite new. But for us, as a company, as CODEMA, it's not new. We've done it over decades. For example, in the tulip industry, we have done it's already several times with, I don't know, seven levels high of multilayer growing indoor.
And also for lettuce as well, we have done also seven-layer high with LEDs, etc. So for us I don't think it will change a whole lot, but I think the growers, they need to change their mindset and that the technologies for climate control that they are evolving really fast. So the lighting, humidity, air flow, I think that's where the evolving needs to take place in the indoor growing multilayer.
Matthew: Very cool. So everything is gonna just get whatever it is now, it's is gonna be more so. I mean, I keep on thinking there's gonna be a process where plants are, as they move through these tables, they'll be observed by cameras that can look for pests, and diseases, and recognize that, and then call attention to it through software or some other means, and maybe even predict that before it happens. So I think, you know, hopefully that's the way we're going. And then maybe even integrating automated trimmers right into the process, curing and trimming, all into the process. Now, I mean, a human has to intervene now, I imagine, you know, to cut the plant and then go through the drying and curing process. But do you see that all merging into one from after harvest to trimming, curing, all that happening in an automated way?
Lars: I think so. Yes. But it's not like it is already done by tomorrow. Just for example, take the bell pepper industry, and no one would have thought 20 years ago, that it'll be in robots, automatically harvesting bell peppers. And see now, I think you see one year ago there's robots automatically harvesting bell peppers. So I think there's an...of course, there's a possibility to automate everything. But I think for the cannabis it's gonna take a while because it's very sensitive crop and it's also very expensive. You don't wanna waste anything. So I think for now, people are a bit scared to automatically handle the plants and rather do it by themselves by hand. So just, yeah, to be more gentle with the plant.
Matthew: Yeah. Yeah. This automation is also kind of a consequence of higher and higher minimum wage. I mean, when companies see that the cost of the minimum wages are going up, they say it's better to invest in automation and save on those costs. Unfortunately, it's an unintended consequence of some policies in certain countries. I noticed in Europe, for example, whenever I go into McDonald's which is not that often, but I do like to just poke my head in and see what...and now, it's just all screens. You place your order on a screen at a kiosk and there's just no people, particularly you see that in France but elsewhere too.
Lars: Also in Netherlands, yeah.
Matthew: Yeah. And then a person does give you your food, but they've cut back massively. And now, if you go onto YouTube too, you can see that there's burger-making robots and machines, you know, work 24/7. So I don't know what the answer is and how we're gonna help reskill and retrain these people as they kinda get replaced. But I don't think those are jobs people really want to have anyway. So I think that's an opportunity to kinda bring them up to another level.
Lars: Yeah, I completely agree. And what you're saying with the minimum wage, that's why our systems aren't viable in every country. For example, in the past in Asia, their minimum wage was really low so they were like, "Well, why would we invest millions of Euros into a system when we can just hire a few cheap Chinese people?"
Matthew: Right, right. Yeah. And that's changing now though too. China is not necessarily a low-wage country at least in the big cities anymore, it's not, but certainly in the countryside, yes. So Lars, let's go to some personal development questions. I like to ask guests a few personal development questions to help listeners get a better sense of who you are personally. With that, is there a book that's had a big impact on your life or way of thinking that you'd like to share?
Lars: Yeah. I was thinking about it. And during high school, I had a special programs called IB, International Baccalaureate. So it's for Dutch people who want to improve their English skills and just continue with flow. We had to read a book, it was called, "Nineteen Eighty-Four," and was written by George Orwell. I don't know, have you read it?
Matthew: Yeah, very familiar with it. Yeah.
Lars: Yeah, yeah. It's just so amazing. It was written in 1948. And it just showed the thought of a possible totalitarian society in the future and how scary it may seem. It looks so accurate nowadays. Big Brother is still watching us. And technology is amazing, don't get me wrong. After reading that book, I now always think twice before I put something on the internet.
Now, let's move on to a tool. Is there a tool web-based or physical that you consider vital to your day-to-day productivity apart from CODEMA tables?
Lars: Yeah, apart from CODEMA tables, yeah. I have sort of a calendar at home. And I don't think it's very funny for you guys, but they're like with a lot of Dutch sayings. If you translate them into English, they sound really weird.
Matthew: Okay, let's hear one.
Lars: Yeah. For example, you have the English saying, "It's raining cats and dogs." Well, that's perfectly normal. If you translate the Dutch version, it's called, "It's raining pipe steels." And for us, it's like, okay, Het regent pijp staal, it's raining pipe steel. So for English, it sounds very funny. And also for example, "Maak dat de kat wijs." This is a very common Dutch saying, but it sounds really funny in English.
Matthew: What does that mean? I didn't catch that.
Lars: Make that the cat wise. I think it's like, if you say something and I don't believe you, then I'm like, "Okay, make that the cat wise."
Matthew: It is weird. It is weird how like sayings and expressions, you know, you just have to understand their meaning or it's just crazy. But then when you try to pick it apart and dissect it, it's like it really doesn't make sense.
Lars: Yeah, that's really funny.
Matthew: You just have to know how to use it in context. Well, cool. Well, great talking with you, Lars. As we close, I'm sure there's a lot of listeners that will wanna reach out and find out if CODEMA is a fit for their grow. How can they do that and learn more, and maybe watch the videos and see what the tables look like?
Lars: Yeah. I think it's first, you could check our website, and it's called www.codema.nl. It has a lot of videos. So also for our other projects all over the globe, for example in China, Europe, but also the states, yeah, there's also our contact information over there, in need of questions, so you can always email or call us. So our website is www.codema.nl.
Matthew: Great. And how do you spell CODEMA? Can you do that, just letter by letter?
Lars: Yeah. CODEMA is C-O-D-E-M-A.
Matthew: Okay. Well, thanks so much. I really appreciate it, Lars. Good luck with everything you're doing. This is really exciting time and just an amazing opportunity to streamline the workflow. I mean, I get tingly looking at an automated grow like this. It's just an amazing thing to behold. So I encourage people that have an inkling to move in that direction to check out CODEMA. And best of luck to you, Lars.
Lars: Yeah, thank you, Matt. It was an honor and a pleasure to be on CannaInsider. And good luck with everything as well.