There are currently two major issues with managing a supply chain on the wholesale side of the cannabis industry. The first has to do with data management and order processing. Each state market has its own compliance laws, which has made it difficult to create a standardized way to manage orders and fulfillment for cannabis wholesalers and their retail customers.
The second major hurdle revolves around inventory issues. Maintaining a steady flow of products has proven to be a major challenge for many cannabis operators. There are many states with mandated supply restraints like Illinois, while others like California and Washington are sitting on inventory. It’s never been more important to define the supply chain and data management processes for the wholesale cannabis industry.
Data Management and Order Processing
Outside the industry, not a lot of people understand the complexities associated with cannabis wholesale. The process is broken and fragmented. If you aren’t using a platform to sell wholesale, the process can take anywhere from 60-120 days.
Do any of the following scenarios sound familiar?
Ensuring inventory is updated and accurate. Without technology, it’s impossible to have real-time numbers. All of the manual data entry takes sales teams away from managing customer relationships.
Hours of order processing. Spending time fielding calls, texts, and email orders. Having to manually update inventory spreadsheets and send orders through to your fulfillment center.
Sharing assets on endless email chains. Retailers need a lot of information just to stock products, like certificates of authorization (COAs) and license information for example. But that doesn’t include information that they need to sell your products well, like marketing and branding assets. The tool you select should have an easy way to share this data (without having to dig through your inbox constantly).
Timely payments. You can’t pay for wholesale cannabis with credit cards, and some banks won’t work with cannabis businesses at all. Buyers have to manually deliver cash, checks or work with distributors to do so. Wholesalers have to follow up and wait to get paid.
Reporting your sales numbers from spreadsheets. A lot of manual data analysis must occur in order to know who is buying what. As a result, forecasting is often a nightmare.
Keeping inventory up to date can be a challenge in any industry, but there are a few extra barriers to orderly inventory management in wholesale cannabis.
Compliance is key. Cannabis is serious business. It was the wild, wild west (no offense Will Smith fans) for a bit, but the power currently lies with the states. Any technology partner must be built around the state-by-state nuances in regulations.
Integrations. You’ve heard the term “software stack” and at any business, there are numerous pieces of software that all promise different things. You have to have one program for ordering, one for accounting processes, one for business reporting, and yet another for customer relationship management.
It’s exhausting, to say the least. And it quickly becomes untenable to keep your team on the same page when everyone is using different systems for different things.
If you have one system that can integrate with all of your back-office functions like compliance, inventory management, reporting, and accounting platforms, then the picture becomes very different. Instead of chasing after each system, the systems all report to one dashboard.
Source of Truth. When you manage your wholesale operations via spreadsheet, it is impossible to have one source of truth for all your data and CRM activity. Find the right platform that will house and manage data in a clean and consistent method so you can look back at historical information and report back to your teams and leadership.
Reporting. You need a platform that houses your data in a clean and manageable way and provides the ability to generate powerful reports and analytics about your business.