Hidden Costs of Not Streamlining Your Cannabis Manufacturing Supply Chain

The cannabis packaging market could expand to 30.3% CAGR to reach $2.9 billion by 2028. These projections are good news for U.S. cannabis manufacturers and suppliers.


Except for this: the current global supply chain faces major hurdles. For cannabis operators, transportation and distribution setbacks create problems across the board, whether the downturn in labor, insufficient delivery trucks and drivers, or rising fuel prices.


At ports and manufacturing plants, companies that continue running outdated technology that disrupts order fulfillment only compounds the problem, costing U.S. businesses millions of dollars each year due to manual workflows and human error alone.


Modern technology and streamlined processes within the cannabis supply chain are vital. Here are the hidden costs of not streamlining your cannabis manufacturing business and supply chain.


Cannabis Regulations and Compliance Processes

The cannabis industry is one of the most complex markets to navigate, with good reason. After all, cannabis has potential side effects like liver injury and mood changes like irritability. But that doesn’t mean that the burden of compliance in the cannabis industry is not massive. For instance, being compliant in a state where cannabis is legal mandates using seed-to-sale tracking software and the provision of sales and inventory reports.


Every cannabis business must also be compliant at the local and state, and federal levels, meaning you must follow all the rules and regulations stipulated by these government bodies. This also means that you must continually be updated on the changes in law and compliance, failure to which your business incurs a fine or closure.


But the only way to achieve this type of updated compliance is to have a seamless flow of operations throughout your supply chain. Here’s an example: the seed-to-sale tracking software you use must produce the required number of reports to ensure your cannabis business meets government standards.


Know more: Compare Seed-to-Sale Software with Cannabis ERP Solutions


However, if you use an outdated system or one not designed for the cannabis industry, you put your business at risk of not producing the necessary reports on time. As such, you need a system that understands the unique nature of the cannabis industry.


Otherwise, you stand to spend a sum of your cash flow on mitigating processes like hiring a lawyer or paying fines. In the worst cases, you might lose your cannabis license.


Cannabis Demands Cannabis Supply

As mentioned, the cannabis supply chain disruption following the pandemic resulted in lost trade routes and shortages in supplies for cannabis cultivation and processing.


But at the same time, there is an increasing demand for cannabis products. Therefore, if your cannabis business remains inflexible to the growing need for alternate suppliers or a diverse supply base, there is a high probability you are missing out on a web of potential customers in your market.


When your supplier runs out of the inventory or ingredients you need for packaging your materials or manufacturing your edible cannabis products, waiting for restock could mean losing business.


Whether the market is constrained or not, you need to meet your current demand and any incoming business. Instead of relying on one resource, creating a streamlined format of multiple suppliers and partners from diverse geographical locations gives you insight into suppliers with or without stock. It also gives you a near never-ending source of materials.


Cannabis Supply Chain Automation

Eliminating redundant processes and human error is a crucial target for every business today: the value of business operational agility is immeasurable. But in an industry where most sales are made in cash, how much time (and cash) are lost on manual processes?


Think about it: If your employees spend more than half their working hours documenting processes instead of working on more pressing issues like customer satisfaction, your business is wasting money.


On the other hand, automating processes like product research, inventory, and employee time clocks allow everything to work and move seamlessly through the supply chain pipeline. As a result, your automation tools do the heavy lifting, which leaves you and your employees with enough time to cater to the customer and other pressing business needs like meeting your growing customer demand.


A Wake-up Call

The demand for cannabis and cannabis products in the U.S. is high. With 44% of Americans living in states where recreational cannabis is legalized and another 91% who want marijuana legalized, if your supply chain is not streamlined from seed to sale, your business will lose this current opportunity for growth and sustainability in the market.


So, this is your wake-up call: it is time to implement sophisticated, high-tech, and integrative automation models and tools for streamlined supply chain operations.


Read Next: Grow your cannabis business in a booming market





Why is it essential to streamline your cannabis supply chain?

By creating a seamless flow of operation from seed to sale, you ensure you don’t incur any hidden costs like added manual labor costs or the cost of losing new business.


How can you streamline your cannabis supply chain?

A robust supply chain management system is designed to ensure all your cannabis processes work in tandem and benefit your business growth. Automation of processes also ensures your supply chain is working efficiently and productively.


Can an ERP system streamline my cannabis supply chain?

Yes. Getting the right ERP system will offer you additional integration and interactive features to streamline your entire cannabis business, not merely your supply chain.


Need advice from a Cannabis Expert?

Get in touch today and discover how e2b teknologies can help your CannaBusiness streamline and grow.

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