By John Garvey
A couple of recent incidents point to the uncomfortable fact that nobody in the cannabis industry is “too big to fail.” Last year, Sweet Leaf had all 26 of its Denver business licenses suspended for a looping scheme. In that scheme, employees were encouraged to sell up to the 1 oz. daily limit to patrons multiple times a day. Police witnessed one customer enter and depart a single location 10 times in one day. In time, they determined that the multi-million-dollar scheme was deliberate, and made over a dozen arrests.
No, seriously—it was a fiasco.
Denver administrative law judge Suzanne Fasing noted that the “unlawful sales resulted in the proliferation of illegal marijuana that supplied criminal drug-dealing.” The thriving cannabis chain lost all 26 of its Denver licenses, and a couple of managers were sentenced to a year in jail.
We think few industry operators today would try to pull off something that blatant even if they thought they could. But that’s not the point.
“Cannabis may be laid-back but the cannabis industry is anything but,” points out Greentrepreneur. “Working in the industry comes with a laundry list of recordkeeping requirements that must be strictly tracked.”
The complexity of state and local cannabis regulations means dispensary managers have to be ultra-straight-laced—at least with regard to compliance. When a 100mg pack of gummies goes missing, you can’t write it off as “pilferage” like it’s a pair of alpaca wool socks. But a quality, cloud-based point of sale (POS) system with cannabis industry customizations can do plenty to protect you. Here’s how.
#1: Quality data management and access
Accurate, accessible record-keeping is consistently cited in industry publications as one of the three most important aspects of running a cannabis operation of any size. Having strong day-to-day compliance without quality data management and bookkeeping is like having the proverbial house built on sand.
“In the eyes of regulators, it doesn’t matter what you did; it matters what you can prove,” Greentrepreneur states in the article cited above.
Many cannabis POS systems lack good auditing tools. When dispensary operators make inventory adjustments and reconciliations, they can be stuck doing a lot of manual data entry. This is miserable, but it’s also a liability because of human error. A good cannabis POS system will time stamp every sale, inventory adjustment and receipt, and assign each transaction to a team member.
As a dispensary operator, you should be able to access and export your own data. In some cases, vendors who want to export their data may have to maintain a license just to access their own data, or request if from a third party.
Metrc/Biotrack tracking and reporting that satisfies and complies with state & county authorities.
#2: Flexibility and ease of operation across jurisdictions
Multi-location operators are often blindsided by issues arising because their software doesn’t support location-specific security needs. When local regulations change, you want system admins and power users to be able to make adjustments on the fly.
When a 100mg pack of gummies goes missing, you can’t write it off as “pilferage” like it’s a pair of alpaca wool socks.
The issue of overselling is especially complicated. For one, different states have different provisions on concentrates vs. flowers. Many jurisdictions have a multiplier—for instance, the state may equate 1 gram of concentrates to 3.5 grams of flower. If you have a customer buying several categories of product in one transaction, do you want your busy budtenders doing the math?
This underscores the importance of having POS and inventory management systems designed specifically for the cannabis industry and can operate across multiple jurisdictions.
Keep your dispensary sprouting upward with our cannabis point of sale and inventory management systems
#3: PCI-compliant credit card processing
Even if we wait a long time to get the federal green light for credit card processing and full banking privileges, PCI DSS (Payment Card Industry Data Security Standards) reflects data security best practices. That means they keep both you and your customers protected. Anthea’s dispensary POS solutions meet or exceed all federal compliance requirements.
The day the Fed lets the industry use conventional banking and credit card processing, your system should be ready. I mean, assuming you like to make money. That preparedness is one advantage of having a partner with experience in other regulated industries, such as alcohol.
#4: Compatibility and integration with other retail support systems
A lot of vendors want to be all things to all people. It can’t be done by a single vendor. Anthea provides dedicated retail front-end POS and CRM solutions. Beyond that, we facilitate best-in-breed ERP, accounting and seed-to-sale tracking solutions through partnerships.
The cannabis industry isn’t a place where you can be a jack of all trades. Vendors who provide business support services need to be rock-solid in their chosen specialties. and their solutions should integrate seamlessly with other systems. Without strong integrations among your front-end (POS and CRM) and back-end (accounting, ERP and seed-to-sale tracking) systems, you can wind up in a bad situation—or an ugly one.
- Bad: Best case scenario, you get stuck doing a bunch of manual data entry.
- Ugly: You run into compliance issues that can result in audits, fines, stress and even having your license compromised.
Traditional retail had some similar issues 10 – 15 years ago before evolving toward specialized, dedicated solutions.
#5: Customer engagement tools
Your CRM platform should allow you to leverage customers’ transaction histories. With mobile marketing in particular, that data is important if not essential to market effectively and draw in repeat business. You should be able to use data to qualify and automatically target customers. Detailed transaction histories let you promote product lines and specials to the customer segments they’ll most appeal to.
Other customer engagement tools you’ll want to consider when choosing among front-of-house retail solutions include:
- Customer kiosk and digital display integration
- Ecommerce integration
- Built-in email marketing
- A built-in points for dollars customer loyalty program
Contact us for an assessment of your cannabis POS needs. You’re not just investing in compliance, you’re investing in customer retention and a good night’s sleep.
