What Michigan Is Teaching the Cannabis Industry About Manufacturing

From caregiver roots to manufacturing excellence, Michigan is showing the rest of the cannabis industry what mature competition looks like.

Michigan loves its weed.

For a state with just over 10 million residents, Michigan has become one of the most important cannabis markets in North America. Walk into almost any dispensary and you’ll find an incredible selection of flower, concentrates, edibles, vape cartridges, and pre-rolls. Deli-style flower is everywhere. Value pricing dominates the shelves. Consumers are knowledgeable, selective, and accustomed to having choices.

But Michigan’s real story isn’t happening at the retail counter.

It’s happening inside cultivation facilities, processing labs, and pre-roll manufacturing rooms across the state.

As wholesale prices have fallen and competition has intensified, manufacturers have been forced to rethink every part of their operation. Expensive mistakes that once disappeared behind healthy margins are now impossible to ignore. Every labor hour matters. Every gram matters. Every production step matters.

Michigan has become one of the first truly mature cannabis manufacturing markets in the United States. Operators aren’t surviving because they have the newest genetics or the flashiest packaging. They’re surviving because they’ve become better manufacturers.

For the rest of the cannabis industry, that’s a lesson worth paying attention to.

A Market Built on Competition

According to Custom Cones USA’s 2026 State of the Pre-Roll Market Report, Michigan has become the largest pre-roll market in the United States by unit volume. While California still leads in total pre-roll revenue, Michigan consumers purchased an astounding 133.4 million pre-rolls in 2025—more than twice the number sold in California despite having only about one-quarter of California’s population.

The report also highlights just how competitive the state has become. Pre-rolls account for 18.2% of Michigan’s legal cannabis market, supported by 520 active pre-roll brands competing across 13,869 individual pre-roll products. Few cannabis markets offer consumers that much choice.

Walk into almost any Michigan dispensary and another trend becomes immediately apparent: multipacks are everywhere. Five-packs, ten-packs, fourteen-packs, and twenty-eight-packs have become standard merchandising rather than niche products. Combined with some of the lowest average pre-roll prices in the country, Michigan has helped redefine how consumers purchase pre-rolls. Value isn’t an occasional promotion—it’s an expectation.

For manufacturers, that creates an entirely different challenge.

Producing millions of single pre-rolls is difficult enough. Producing thousands of SKUs across multiple pack sizes, cone formats, weights, infused products, and price points requires a manufacturing system that is both efficient and remarkably flexible. Every additional SKU introduces another changeover. Every new package configuration creates another opportunity for bottlenecks. Every second of unnecessary labor becomes more expensive when margins continue to tighten.

That’s why we believe Michigan has become one of the most important cannabis manufacturing markets in North America.

The state’s success isn’t built solely on growing great cannabis. It’s built on the ability to manufacture, package, and deliver an extraordinary variety of products efficiently, consistently, and at prices that remain attractive to consumers. As more markets mature, we believe operators across the country will begin asking the same question Michigan manufacturers are already answering every day:

How do we produce more, waste less, and never sacrifice quality?

Before Adult Use, Michigan Was Already Building Cannabis Operators

One of the biggest misconceptions about Michigan is that its cannabis industry began with adult-use legalization in 2019. It did not.

Michigan legalized medical cannabis in 2008, creating the country’s largest caregiver systems. For years before adult-use sales, caregivers were not simply growing plants. They were learning how to produce consistent flower, manage inventory, understand patients, solve production problems, and operate small businesses around cannabis.

That history matters.

By the time adult-use legalization arrived, Michigan was not introducing cannabis to the public for the first time. It was commercializing an industry that had already spent years learning the plant. Growers understood genetics. Operators understood cultivation. Consumers understood quality. The market already had a deep base of people who knew cannabis from the inside, not just from a business plan.

Michigan also developed differently from California.

California helped create modern dispensary culture. Michigan developed a culture more deeply rooted in cultivation, production, and operator knowledge. Basements became grow rooms. Garages and barns became cultivation spaces. Warehouses became production facilities. The conversation was not only about where to buy cannabis. It was about how to produce better cannabis

That foundation shaped the market we see today.

When adult use arrived, Michigan did not need to learn cannabis. It needed to learn how to scale cannabis.

That is a very different challenge.

Scaling cannabis means moving from grow rooms into processing, preroll production, extraction, packaging, labeling, inventory, compliance, warehousing, and distribution. Every department becomes connected. Every bottleneck matters. Every labor touch has a cost.

Michigan Was Built to Manufacture

Spend enough time visiting cannabis operators across Michigan and you begin to notice something that has nothing to do with cannabis.

Michigan was built to manufacture.

For more than a century, the state’s economy has revolved around making things. Automobiles, furniture, aerospace components, industrial machinery, office equipment, and advanced manufacturing have all helped shape Michigan’s identity. Generations of engineers, machinists, electricians, toolmakers, mechanics, fabricators, and entrepreneurs built careers solving production problems. That manufacturing culture didn’t disappear when cannabis became legal. It simply found a new industry.

You see that mindset everywhere. Operators aren’t afraid to modify equipment, redesign production lines, build custom workstations, fabricate their own solutions, or rethink an entire workflow if it improves efficiency. They don’t automatically look for someone else to solve a problem. More often than not, they grab a tape measure, a welder, or a whiteboard and start figuring it out themselves. Around here, “good enough” rarely stays good enough for very long.

Michigan also benefits from something many newer cannabis markets simply don’t have: manufacturing infrastructure. Cannabis companies didn’t have to build an industrial ecosystem from scratch—they inherited one. Industrial buildings are plentiful. Manufacturing space remains remarkably affordable. Machine shops, fabrication companies, industrial electricians, automation suppliers, packaging vendors, logistics providers, and warehouse contractors have been supporting manufacturers for generations. That infrastructure makes it easier to build, expand, repair, and continuously improve a production facility.

The economics matter just as much. Compared to many legal cannabis markets, Michigan operators can lease or purchase significantly larger manufacturing facilities for a fraction of the cost. Every dollar not spent on rent is another dollar that can be invested where it creates value—better workflows, additional production capacity, employee training, process improvements, or new equipment. In one of the most competitive cannabis markets in North America, those investments compound over time.

Michigan’s cannabis industry has also attracted people from many different backgrounds. Former automotive workers, skilled tradespeople, engineers, caregivers, entrepreneurs, and people from around the world have all contributed to the industry’s growth. Different experiences bring different ideas, and those ideas have helped create one of the most innovative manufacturing cultures in cannabis.

That’s one of the reasons Michigan became Hummingbird’s largest market.

The operators we met weren’t looking for the biggest machine or the newest technology because it looked impressive. They wanted equipment that solved real production problems. They wanted better workflows, faster changeovers, lower labor costs, higher throughput, and consistent quality. Those are manufacturing conversations, not sales conversations.

When you combine affordable manufacturing facilities, an established industrial infrastructure, relentless competition, and a culture built around solving production problems, continuous improvement stops being a business strategy.

It becomes a competitive advantage.

Competition Does Not Destroy Businesses. It Builds Better Ones.

People outside Michigan often focus on the prices.

Indoor flower around $700 per pound. Low-cost one-gram pre-rolls. Value multipacks. Aggressive dispensary promotions. For many observers, Michigan looks like a race to the bottom.

We see something different.

Michigan is not a race to the bottom. It is a preview of what mature cannabis competition looks like.

When margins are huge, companies tolerate inefficiency. Waste hides inside healthy pricing. Extra labor gets absorbed. Slow changeovers are annoying but survivable. Poor workflow gets patched with more people. In young markets, businesses can often make money despite inefficient operations.

Michigan does not offer that luxury.

When prices compress, every inefficiency becomes visible. Every unnecessary movement matters. Every gram of waste matters. Every extra employee on a line matters. Every bottleneck matters. Every minute spent changing from one product to another matters.

That pressure can be painful, but it also creates better manufacturers.

The best operators in Michigan are not waiting for prices to magically improve. They are improving their operations. They are reducing wasted motion. They are tightening workflows. They are studying labor efficiency. They are thinking harder about throughput, changeovers, packaging, and SKU complexity. They are asking how to produce more consistent finished goods with fewer mistakes and less waste.

That is exactly how mature industries evolve.

Automotive did not become world-class because competition was easy. Food manufacturing did not improve because margins were unlimited. Pharmaceutical manufacturing did not develop strict process controls because inconsistency was acceptable. These industries improved because competition, regulation, and consumer expectations demanded it.

Cannabis is now entering that same phase.

Michigan just got there first.

Automation Is Never One and Done

One of the biggest mistakes cannabis operators make is believing automation has a finish line. Buy the machine, install the machine, train the operators, and the hard work is over. In reality, that’s when the real work begins. Every new piece of equipment changes the workflow around it. A faster pre-roll filler affects grinding, weighing, staging, packaging, labor assignments, material flow, quality control, and finished goods inventory. Improve one process without thinking about everything upstream and downstream, and the bottleneck simply moves somewhere else.

We’ve seen this happen countless times. A manufacturer invests in a faster filling machine only to discover packaging can’t keep up. Another company doubles filling capacity, but operators spend more time loading and unloading equipment than producing finished prerolls. Sometimes the machine performs exactly as promised, yet overall production barely changes because the real constraint was never the machine—it was the workflow surrounding it. That’s why purchasing automation should never be viewed as the finish line. It’s simply another step in the continuous improvement process.

Automation also changes the organization itself. As manufacturing matures, responsibilities naturally become more specialized. Instead of every employee doing a little bit of everything, people begin owning specific parts of the workflow. One person prepares material. Another fills cones. Another packages finished goods. Another focuses on quality control. Repetition creates consistency, and consistency makes improvement easier. The more often someone performs the same task, the easier it becomes to identify unnecessary motion, improve organization, eliminate waste, and shorten cycle times.

That’s another reason workflow matters so much. If Chad operates a Hummingbird, you’re paying Chad what you would normally pay a production employee. He learns the machine quickly, becomes more efficient over time, and can still move between material preparation, filling, packaging, quality control, and other parts of the workflow as production demands change. The machine becomes another tool in the operation—not the center of the operation.

Some manufacturing systems follow a different philosophy. As the equipment becomes more sophisticated, the operator becomes more specialized. Before long, you’re no longer paying for a production employee—you’re paying for someone whose primary responsibility is keeping one complicated machine running. That may work in some industries, but it also creates higher labor costs, longer training periods, and less flexibility when production schedules change. The business becomes increasingly dependent on one machine and one operator rather than building a manufacturing system that the entire team can support.

The most successful manufacturers don’t think in terms of individual machines. They think in terms of complete manufacturing systems. A machine capable of producing thousands of prerolls per hour isn’t automatically valuable if packaging falls behind, if quality issues create constant rework, or if downtime leaves employees standing around waiting. A faster grinder doesn’t increase production if filling becomes the bottleneck. Hiring another employee doesn’t solve a production problem if the real issue is poor facility layout, inefficient material movement, or lengthy product changeovers.

Throughput is almost never determined by the fastest machine on the production floor. It’s determined by the slowest step in the process.

This is where Lean Manufacturing becomes especially relevant to cannabis. Many Michigan operators may never use the words “Lean Manufacturing,” but they’re practicing its principles every day. They reduce unnecessary movement. They standardize repetitive tasks. They shorten changeovers. They organize workstations. They measure labor carefully. Most importantly, they never assume a process is finished simply because a new machine has been installed. Continuous improvement isn’t a quarterly initiative or a management slogan. It’s part of the culture because, in a market where margins continue to shrink, small improvements often determine whether a company makes money or loses it.

That mindset becomes even more important in pre-roll manufacturing because the category continues to grow more complex every year. Operators aren’t producing one pre-roll in one size using one type of cone anymore. Today they may be running traditional one-gram cones, half-gram dogwalkers, infused products, glass tips, ceramic tips, blunt tubes, pinners, premium singles, value-priced multipacks, and promotional SKUs—all within the same facility. Every new product creates another setup, another changeover, another quality standard, and another opportunity for inefficiency.

We believe the goal of automation isn’t to build a manufacturing operation around one machine or one operator. It’s to build a manufacturing system where every improvement makes the entire team more productive. Equipment should support the workflow, not dictate it. The best manufacturing operations continue improving long after the machine is installed because the people using it keep finding better ways to eliminate waste, improve quality, shorten changeovers, and increase throughput.

That’s exactly what we saw throughout Michigan. The operators succeeding there aren’t chasing the newest machine. They’re continuously building better manufacturing systems. And in the long run, that’s what creates a lasting competitive advantage

Manufacturing a Product That Never Stays the Same

Every manufacturing industry is chasing the same goal: produce more, waste less, improve consistency, and lower costs.

Cannabis shares those same objectives, but it begins with a raw material unlike almost any other.

Whether a company grows its own flower or purchases flower from multiple cultivators, variability never disappears. In vertically integrated operations, every harvest behaves a little differently. Moisture changes. Density changes. Resin content changes. Particle size changes. Some flower grinds beautifully. Some becomes sticky. Some bridges inside hoppers. Some settles perfectly. Other batches require completely different machine settings to produce the same finished preroll.

For processors purchasing flower from multiple cultivators, the challenge often becomes even greater. Every supplier has different genetics, cultivation practices, drying methods, curing techniques, trimming equipment, and storage conditions. Two lots may have nearly identical cannabinoid profiles yet behave completely differently once they reach the grinder. That’s simply the reality of manufacturing with an agricultural product.

Most mature manufacturing industries don’t face that problem.

An automotive manufacturer expects every bolt to meet the same specification. A beverage company expects every bottle to have identical dimensions. Pharmaceutical manufacturers receive ingredients produced to incredibly tight tolerances. Their challenge is producing consistent products from consistent raw materials.

Cannabis manufacturers face the opposite challenge.

Every day, they’re expected to produce remarkably consistent products from raw materials that are constantly changing.

Consumers don’t care that today’s flower came from a different harvest or a different cultivator. They expect the preroll to weigh the same, draw the same, burn the same, look the same, and deliver the same experience every time they open the package. They judge the finished product—not the variability behind it.

That’s why manufacturing process matters so much.

Consistency doesn’t come from one machine. It comes from controlling the entire workflow. Material preparation, grinding, moisture management, staging, filling, settling, weighing, closing, packaging, labeling, and quality control all influence one another. Small variations at the beginning of production become much larger problems by the time the product reaches the dispensary shelf. The best manufacturers don’t eliminate variability—they build processes that can adapt to it.

Michigan demonstrates that better than almost anywhere else in the country. In a market where margins continue to shrink, manufacturers can’t simply throw more labor at production problems. They have to build systems capable of producing consistent products from inconsistent inputs. That’s a far more difficult manufacturing problem—and one that will become increasingly important as cannabis markets continue to mature.

Ultimately, we don’t believe the future of cannabis manufacturing belongs to the companies with the biggest facilities or the most expensive equipment. It belongs to the companies that build the most adaptable manufacturing systems—workflows capable of delivering consistent products from a raw material that never behaves exactly the same twice.

Why Michigan Became Hummingbird’s Largest Market

After spending time in Michigan, one thing became clear to us: it probably was not an accident that Michigan became Hummingbird’s fastest growing market.

At first, we assumed it was simply because Michigan is a large cannabis market. That is partly true. The state has thousands of licensed cannabis businesses and one of the most active pre-roll markets in the country. But size alone does not explain it. Plenty of large markets exist.

Michigan feels different because operators think differently.

They are not impressed by automation for automation’s sake. They are not looking for equipment that only looks good in a trade show booth. They want to know how a workflow performs in the real world, on a real production day, with multiple strains, multiple SKUs, labor constraints, packaging pressure, and real margin expectations.

We respect that.

Before Hummingbird ever built equipment, we manufactured pre-rolls ourselves. We lived through the same bottlenecks, labor challenges, production headaches, and quality issues operators face every day. We know what it feels like to try to increase production without simply adding more people. We know what it feels like when one station gets faster and another station falls behind. We know what it feels like when a product that looks simple on the shelf becomes complicated on the production floor.

That operator background shapes how we build.

We do not start by asking, “What machine can we sell?”

We start by asking, “What production problem is costing us the most time, labor, and frustration?” Michigan operators understand that question because they are asking it themselves.

That is why the market has been such an important proving ground for us. In Michigan, equipment has to earn its place. It has to reduce labor. It has to support flexibility. It has to help with throughput. It has to make sense in a market where prices are low, competition is high, and mistakes are expensive.

If a workflow can prove itself in Michigan, that means something.

It means the equipment is not just solving a theoretical problem. It is helping operators compete in one of the most demanding cannabis markets in North America.

What Other Markets Can Learn From Michigan

Every cannabis market eventually matures.

At first, the opportunity is simple: grow product, open stores, meet demand, and capture margin. Then supply increases. Consumers become more selective. Retailers gain leverage. Prices fall. Product variety expands. Suddenly, the companies that looked successful during the early years have to prove they can operate efficiently.

That is when manufacturing begins to matter.

Michigan is not an outlier. Michigan is ahead of the curve.

The lessons being learned there will become relevant everywhere. Operators in newer markets may look at Michigan and see low prices. We look at Michigan and see the future: tighter margins, more SKUs, more competition, more consumer choice, and more pressure to build better systems.

The companies that survive that transition will not be the ones that bought the most expensive equipment or built the biggest rooms. They will be the ones that learned how to improve faster than everyone else.

Manufacturing has always rewarded continuous improvement.

Automotive proved it.

Food manufacturing proved it.

Pharmaceutical manufacturing proved it.

Cannabis is beginning to prove it too.

Michigan reminds us that competitive advantage is not built through one big purchase. It is built through thousands of better decisions made every day: eliminating one unnecessary movement, reducing one bottleneck, improving one workflow, shortening one changeover, and asking how tomorrow’s process can be better than today’s.

That is the mindset that built great manufacturing companies long before cannabis existed.

It will likely build the next generation of cannabis manufacturers as well.

Michigan is not teaching the cannabis industry how to be cheaper. Michigan is teaching the cannabis industry how to be better. And if you can make it there, you can probably make it anywhere.