The cannabis industry continues to evolve rapidly in 2019, along with it, so should your perception of Enterprise Resource Planning (ERP) and related applications. As a business begins to grow and scale, disparate systems create new challenges and overhead costs that impact your ability to scale profitably. With the intense regulatory and compliance focus placed on the cannabis industry, often the optimal path to growth is to narrow your search to a comprehensive solution that helps eliminate silos and enables your employees to work more efficiently with less overhead to manage linking systems and software.
Because every company is unique, there’s no single indicator that can suggest precisely when you might need an ERP software solution. However, discovering inefficiencies and road blocks in current business processes may suggest converting to an ERP system. Within this article, we will briefly cover why the implementation of an ERP software will grow your canna-business in 2019.
Done right, Cannabis ERP makes your teams more efficient at day to day operations and provides a tremendous reduction in time spent on audit and compliance related activities.
Establishing the need for a new ERP
The most important aspect before implementing an ERP system into your organization is understanding the strategy of your business processes. Focusing on the people and operations rather than the technology will give you insight as to what the core issues are, and what the ERP software can resolve. Whether your organization is struggling with accurate data from sales, cannabis compliance tracking, inventory costing or accurate accounting information, it can trigger a ripple effect on everything from marketing to payroll, from investment to employee retention. As you realize these symptoms are occurring in your business, it becomes imperative to address them cohesively to allow for stability and growth.
What ERP can do for your cannabis business
Although the regulation of marijuana still seems to be a topic of variability between states, the development of technology surrounding the industry is constantly growing. If you’re a serious cannabis operator and you need a software system for your manufacturing and cultivation operations, an ERP software platform geared for the cannabis industry is what your company needs to stay compliant.
Traditional ERP is an enterprise resource planning tool that is used to organize business tasks throughout an organization in a cohesive software program. These essential management tools include planning, purchasing, inventory, sales, costing, finance, etc. By combining management of these departments into a connected program, businesses can realize operational efficiency and profitability by lowering costs and decreasing waste in time, labor, and inventory. Ensuring the solutions you pursue are focused on regulatory and compliance requirements for your state and municipality are imperative to ease of growth. The last thing a business would need when facing an ERP implementation is worries about integrating with external solutions for compliance and grow/recipe management.
Beginning Your Search
Once recognizing that a comprehensive Cannabis ERP solution is what your business needs to make it to the next level, it is time to begin serious planning around the selection of your ERP provider. After assessing the pain points within your current business processes, you must make time to undertake an honest top-to-bottom look at all your current administrative tasks. Think of this as a shopping list that you will be referencing as you evaluate ERP options.
- Process Mapping: Use the early part of the sales process to network with providers and understand their specific approach to implementation. Gain an understanding of where solutions have to evolve to match a human process, and where human processes must change to match the software. These two facets are critical to a successful implementation. At the same time, your team can establish rapport and understand what will and won’t work with particular providers and solutions. Taking this step early will help educate your team before you enter into any type of RFP process, which tends to be cumbersome and confusing to those who haven’t purchased an ERP solution before.
- Document your needs: Putting your needs into words will help create an RFP framework for your ERP needs. This allows your business to be more satisfied with the answers from potential software companies. Be thorough in outlining your needs to shape the kind of product you need to receive because this will determine the future of your company. See step 1 if you’re not clear though. It is imperative that you compare similar solutions and approaches, and be prepared to challenge responses that seem vague or elusive.
- Evaluate Objectively: This is where your prior planning pays off, with a good scoring matrix and good search methodology. In a young industry like the Cannabis space, bigger names may or may not have true industry expertise that fits well with your team and business. Cannabis expertise and compliance functionality is essential for your business to gain from utilizing ERP.