Marijuana Business Magazine January 2019

Marijuana Business Magazine | January 2019 74 Technology designed for cannabis businesses is making it easier to manage inventory and forecast sales. Point-of-sale (POS) systems integrated with data platforms and wholesale business-to-business marketplaces can eliminate the need for manual inventory tracking and back-and-forth communication with multiple vendors. Cannabis businesses sometimes use Google Sheets or Google Jamboard in lieu of new, streamlined inventory- tracking solutions that may have an added cost to operate, industry technology experts said. The downside to working in these Google programs, experts said, is they require more manual data entry than new automated systems, and they don’t provide comprehensive business intelligence or automated ways to collaborate with vendors. Those platforms also require inventory tracking to be done in a system separate from what the technology retailers use in their day-to-day operations, such as POS systems. “We’ve asked (businesses) the question, ‘What was your most-sold product yesterday?’” said Ryan Smith, co- founder and CEO of of Los Angeles-based LeafLink, a business-to-business wholesale marketplace for retailers and product manufacturers to buy and sell product. “And they tell us their infused drinks do really well, or their chocolates do really well, but they don’t have a finite, quantifiable answer.” In part, the technology now available to cannabis businesses to streamline inventory management is taking a page from the playbooks of big-box stores, which use automated systems to manage inventory intake from thousands of vendors, said Cy Scott, co-founder and CEO of Headset, a Seattle-based cannabis data platform that created Headset Bridge, a retail product that gives businesses visibility into everything from sales numbers to inventory levels. Most systems—POS, data platforms or wholesale marketplaces—don’t perform all functions. Rather, application programming interfaces (APIs) create an ecosystem that allows the complementary features of the various technologies to give retailers a more complete picture of their inventory. According to Smith, Scott and Ben Curren, founder and CEO of San Jose, California-based Green Bits, a retail platform and POS system designed for cannabis businesses, the integration of data platforms and wholesale B2B marketplaces with some retail point-of-sale systems can: • Bar code every item in a retailer’s inventory to cross- reference with a state’s seed-to-sale tracking system. • Run audit reports that reconcile the inventory you have on hand with the inventory on file in the state’s tracking system. • Show retailers the sales velocity for individual products, which helps them determine whether to increase or decrease reorders. • Allow shops to set par levels on products and schedule automatic reorders when supply levels reach par. • Create permissions for manufacturers to see how their products are selling and recommend reorders. • Reduce correspondence with vendors who—because of access permissions—have insight about when you need to reorder. When technologies are integrated, their functions can allow retailers and manufacturers to identify the “Goldilocks amount” of inventory to carry or produce, Headset’s Scott said. “You want to have the amount of inventory necessary to fill demand, because if you buy too much product, your cash is in inventory instead of in marketing or in another important part of your business,” Curren said. The biggest “value-add” that emerging technology for cannabis businesses offers, Curren said, “particularly in a market where the environment is changing quickly, is that retailers can actually focus on the act of retail sales instead of tracking information.” – Joey Peña Leveraging Technology Ryan Smith, left, and Zack Silverman co-founded LeafLink in 2015. Courtesy Photo Stock Taking Headset Bridge allows retailers to see how various products are contributing to the day's total sales. Courtesy Photo