Look out, Nordstrom. Move over, Whole Foods. Box it up, Costco. And as for you, Apple, the green is coming for you, too. Recreational marijuana stores (in Seattle anyway) are generating more sales per square foot than any of these prominent national retailers. And the gaps in the cases of some of the busiest cannabis stores are huge — five to fifteen times the sales per square foot. With all that green coming in the doors, it must be easy to turn a profit in the cannabis industry, right? Not so fast. Cannabis is a high risk, high reward business, and to reap the rewards, you may need to act a bit like the behemoths (and millions of other successful businesses). You’ll need to carefully consider and understand what’s running the business side of your business. In other words, you need to consider utilizing cannabis software that gives you the insight and answers you need.
Difficult to turn sales into profits
Regulations and laws affecting the cannabis industry remain a moving target. Taxes and fees abound. And of course, there remains much uncertainty at the federal level. For example, in Washington, there is a 37% tax on marijuana, plus sales tax, business and occupation tax, plus license fees for the business. And operators are further squeezed by IRS section 280E, which prevents cannabis companies from deducting expenses from their income (like rent!) except for those considered costs of goods sold. It can be a tough way to make a living, but you knew that when you jumped in, didn’t you?
Cannabis software makes the difference
We may have mentioned it once, or twice, or even more, but to be successful in a highly-regulated, volatile industry, cannabis businesses need effective, comprehensive, flexible and modern cannabis ERP software that enables them to operate efficiently, execute on their tax and regulatory compliance strategies, and run profitable enterprises. In this way, your cannabis business is no different than any other business. In fact, the best cannabis ERP solutions are proven business management solutions that meet the core demands of businesses in a wide variety of industries — because the core demands of most businesses are remarkably similar.
Depending upon the segment of the cannabis industry you’re operating in, you may need functionality like inventory management, production cost tracking, lot tracking and control, warehouse management, manufacturing, finance/accounting, and human resource management. And you’ll want to be sure the solution you select offers flexibility and configurability to allow you to adapt to meet the rapidly evolving business climate of the cannabis industry. Remember the phrase, “the only constant is change”? It applies particularly well to the cannabis industry (and to Seattle’s weather, but that’s another story).
Business is business
So, are we saying that to succeed in the cannabis business, you should start acting like every other business? Of course not. You’re in a unique industry to be sure, with unique challenges and unique rewards. But it’s still business, and efficient and effective business processes enabled by an ERP application are at the base of every successful business.
Silverware works with cannabis growers, processors, and distributors to accomplish their specific goals and address their unique operational challenges. We understand your industry, we understand business. Let’s talk.