Businesses across the globe have felt the sting brought on by the COVID-19 outbreak, but few industries have been affected the way the cannabis industry has. For the cannabis industry, a disrupted supply chain has emerged as the most significant obstacles to overcome during this pandemic with some companies facing mounting losses every day.
Impact of Pandemic on the Cannabis Supply Chain
The root of the cannabis supply chain disruption lies in shipping delays and fewer available supplies stemming from several contributing factors, including factory closures, contaminated workers, stalled production, and upended transportation routes.
China is the primary provider of vape products and other cannabis essentials. They were also the hardest-hit country in the initial phases of the pandemic with forced closures driving much of the supply chain hang-ups. From harvesting essentials to vape hardware and marijuana edibles to packaging, cannabis companies who lacked alternate suppliers and supply chain visibility were left without needed materials.
For some cannabis companies, purchasing and inventory management processes are still handled via spreadsheets, fax and email instead of more sophisticated supply chain software.
Cannabis Enterprise Resource Planning (ERP) to the rescue
If you’re one of the growing cannabis companies still hindered by manual record-keeping, the opportunity for cost savings and operational efficiencies comes through better inventory controls and supply chain management with industry-specific ERP.
Cannabis ERP solutions are designed to help you streamline and grow your business through effective cannabis supply chain management. Read on for more ways an industry-specific ERP system delivers peace of mind, even in hard times like these (video).
Maintain Real-time Supplier Information & Risk Levels
Cannabis ERP solutions come equipped with features that manage all of your supplier information and inventory detail. Now you can monitor and control which inventory items to purchase, from which vendor according to their rankings and assigned risk levels.
These rankings, determined using data collected by the ERP systems, help ensure that vendors adhere to their standards and yours, which could include proper sanitation guidelines, security measures, and safety policies.
A cannabis ERP solution also seeks to establish supplier transparency through regular communication and audit rights by managing and monitoring supplier transactions. This facilitates the audit rights to measure the economic viability of each supplier. By building a risk assessment and rating system for suppliers, you get visibility into transaction history, price points, quality control performance, and average lead times.
Establishing an approved list of suppliers to ensure an ongoing supply of quality raw materials for your cannabis products, cannabis ERP systems help quickly identify alternative suppliers should a primary supplier become unavailable.
Current Inventory Management and Material Planning
A cannabis ERP system helps you continuously manage and monitor your inventory with real-time tracking features. By keeping an eye on the movement and storage of inventory, these solutions provide you with accurate information about future requirements and procurement instructions. By automating transactions and enforcing traceability controls, you maintain real-time access to critical inventory data. This includes insight surrounding future material needs and procurement instructions.
These procurement guidelines include multiple data points such as safety stock levels and minimum order quantities to ensure effective planning and timely reordering. Cannabis ERP records the information of shelf life, vendor lead times, and production timeliness in the centralized database that can be used for accurate demand forecasting.
Cannabis ERP also allows you to prepare for customer demand fluctuations caused by holidays and seasonal consumption trends by tracking patterns over time, offering foresight to mitigate supply chain setbacks.
Effective platforms to protect your cannabis company from the supply chain disruptions such as those caused by natural disasters, pandemics or other business struggles, Cannabis ERP systems not only provide you with the documented and vetted vendors but also supplier information transparency that can help you make decisions related to the risk levels and vendor rankings.
The right cannabis ERP affords operators peace of mind knowing that they’re prepared for supply chain disruptions. With these matters handled, you’ll be able to turn more of your attention to scaling your operation to maintain a competitive advantage.
Contact us to learn how c2btek can help your cannabis business navigate the supply chain challenges ahead.