Imagine you have a lemonade stand and you need to buy lemons, sugar, and cups to make lemonade. The cost of these items is the "cost of goods sold" or COGS. If you can buy the lemons, sugar, and cups for less money, you can make more profit.
The big companies that sell cannabis (a plant used for medicine and fun) in the U.S. have to deal with many rules and taxes. These rules and taxes make their COGS higher. But, some of these companies are getting better at finding ways to lower their COGS. They are also spending less money on other things, like advertising and office supplies. This helps them make more profit.
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