Last year saw record growth for the cannabis industry, and as legalization expanded, many sought to improve their mental health with cannabis products. After all, it was a year defined by a global pandemic, economic stagnation, and political uncertainty.
So what if more Americans turned to cannabis products in 2020 than ever before. Whether it was to help them cope with medical ailments or a world in flux, the increased consumption resulted in a 71% increase in national sales, which over $10 billion more than the previous year. It’s no surprise then that more entrepreneurs are staking their claims to take advantage of the cannabis boom, and established cannabis businesses are refining operations to maximize their market opportunities.
Of course, with every business boon, there’s a technology behind the scenes that drives it. That’s why more operators are turning to cannabis enterprise resource planning (ERP). Cannabis ERP solutions have become essential tools for businesses in this industry, helping cannabis business owners and investors seize the moment amongst heavy competition while maintaining regulatory compliance.
What can a top-quality cannabis ERP solution do for your business? Below, we’ll break down some of the most critical components of cannabis ERP software and the fundamental benefits that these systems offer savvy cannabusiness operators like you.
Absolutely the most essential part of every cannabis business is maintaining compliance with municipal, state, and federal regulations. Compliance violations can cost a company millions in fines or lost revenue, and the possibility of criminal penalties means that owners and operators risk incarceration for the most severe infractions.
All cannabis businesses should continually strive for 100% regulatory compliance, and cannabis ERP solutions make this a more intuitive process. Top cannabis ERP solutions integrate disparate operational departments and work effectively for businesses that span multiple jurisdictions with regulatory differences.
Establishing accurate ERP system parameters secures compliance by automating record-keeping, administrative reporting requirements, and seed-to-sale tracking needs. Federal IRS regulations 280E and 471 can be a particular headache for owners and cannabis CPAs, but a comprehensive ERP solution will ensure that necessary record-keeping is thorough and accurate.
ERP solutions are especially useful for cannabis companies with non-cannabis business entities by ensuring operational separations that critically affect their tax liabilities. The best cannabis ERP solutions integrate with governmental reporting software, like METRC, streamlining the process of regulatory compliance.
For an industry focused on sales revenue, inventory management is a crucial component of successful operations. Cultivators and dispensaries alike share this need for regulatory compliance requirements as well as accounting for each transaction.
Seed-to-sale tracking applications automate record-keeping, saving valuable time and labor costs compared to manual tracking prone to data entry errors. For cultivators in particular, cannabis ERP solutions help manage crops over long periods. Detailed data on strain-specific tracking, activity costs, plant health, and batch yields maximizes a cultivator’s ability to quickly respond to any agricultural issues that could affect company productivity.
State-of-the-art systems closely monitor cultivation environments to ensure consistently high yields while lowering labor-intensive expenses. Real-time assessments track growth and plan effective harvesting, letting a business plan successfully for their crops’ future.
Security is an important factor for any business, but cannabis businesses need to center on this issue in new ways. Cannabis is a unique product and many states only recently legalized consumption. Unfortunately cannabis businesses are forced to rely on cash transactions that can quickly pile up. A modern cannabis ERP solution focuses on security measures for on-premises surveillance and cybersecurity protection.
Cannabis point of sale locations can be monitored, recorded, and stored in the cloud for easy viewing, and crucial business systems can be protected from the risk of data breaches or ransomware attacks. Not only is it wise for cannabis businesses (cultivators and dispensaries alike) to invest in facility security tools, many jurisdictions require it by law.
An effective ERP solution delivers peace of mind. It alleviates much of the headache involved with compliance, the risk of product loss due to theft, sticky fingers handling cash, and sensitive client data protection.
Cannabis-specific ERP solutions can dramatically change the way you do business, and competition in the industry is sure to get more intense as sales continue to rise. Don’t risk falling behind by waiting too late to integrate the latest ERP advancements.
Investing in a comprehensive ERP solution for your cannabis business is an investment in your cannabis company’s longevity. With so many products and services on the market today, take the time to research the specific applications of different cannabis ERP systems and decide which one meets your operation’s needs. If you need help deciding which system is right for your cannabis business, speak to one of our compliance experts today.