Inventory Management for Cannabis Business

cannabis inventory management

Cannabis Inventory Management

Retail inventory management systems have existed for a long time. They facilitate the complex interchange of supply and demand for an increasingly consumptive society. For traditional markets, there exist several industry-standard companies with shared or similar processes and procedures, proven over time to work. In a nascent industry like cannabis, however, there are not decades of historical data upon which to develop an infrastructure to meet this massive, inventory-driven industry’s systemization needs.

At first glance, this may appear to be a simple logistics issue that could be resolved with traditional inventory systems practices. In fact, the landscape of retail cannabis poses especially unique complexities for cannabis inventory management. The situation requires innovative, flexible companies in an ancillary services sector to develop these standards and processes in response to the needs of their customers.

Traceability is key. In a regulated industry, any cannabis inventory management system (IMS) must be able to address the compliance aspect of legal marijuana. Instead of an offered feature, this quickly became a basic requirement for all cannabis-IMS providers. A further sub-industry of specialists, trainers, and distributors has arisen to address other aspects of supporting the needs of those IMS providers.

One impactful mandate by the Washington State Liquor and Cannabis Board (WSLCB) allows for a maximum of only four months average sales value worth of stock allowed on hand at any time for retailers. These products generally all have a one year shelf life – also mandated – and realistically much longer depending on storage conditions. Many retailers may prefer to purchase a larger quantity and keep a considerably large amount of product in specialized, long-term storage. However, this regulation effectively obligates more frequent transactions, transportation, and staff interaction with product.

When cannabis as an industry was able to move to the traditional retail model, a variety of these cannabis inventory management providers moved quickly to advanced their role and deliver exceptional levels of service. Some leaders in this segment of the industry have created extensive toolsets that allow retailers seamless integration with accounting software, compliance reporting systems, even auto-ordering that allows resellers and distributors to respond to consumer demands in a dynamic way. Multi-platform reporting that automatically prepares orders for high-performing products and brands is becoming the new standard.

What began as a pot shop managing a few local cannabis farmers’ harvest or buying from a centralized market, retailers now may process many thousands of packages of cannabis from hundreds of producer/processors’ products every month. From receiving incoming samples to ensuring the available stock for critical partnerships, maintaining the right inventory for products based on performance and customer demand is objectively a more exacting method. This allows for greater control, minimized waste, and buying the right levels of products — all of which reduce overhead and increase efficiency.

by Michael “the Aging Ent” Schroeder, owner, Green Owl Media


  1. Nic on April 20, 2019 at 7:23 pm

    Sp you have a stock name?

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