This post originally appeared on Entrepreneur.com - #Growing Your Business
Here’s how cannabis companies can utilize AI to improve infrastructure and improve workflow.
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Cannabis is all the rage these days. In fact, Grand View Research reports that the global legal marijuana market is expected to hit USD $146.4 billion by 2025, meaning your CannaBusiness is either at the forefront of this ever-changing industry, or will be left behind when those projected sales numbers hit.
To avoid getting smoked by the competition, let alone implode due to problems such as lack of traditional credit line access, cannabis start-ups must future-proof their position, evading the exigencies of this growing, yet capricious, market.
One person who knows this well is Sara Branch. As the director of Technossus, a company renowned for accelerating businesses around tech, she helps advise organizations on how to implement emerging tools like AI.
Drawing on her extensive tech background, as well as experiences advising CannaBusinesses on their go-to market strategy, Branch offers three tips for brands looking to ride the wild weed wave to lasting profitability.
Automation is a big AI buzzword, but it also has implications for the cannabis space. Flying by the seat of your pants — or relying on a more analog, human-centric model for statute conformity — is dangerous, especially since rules change with locale. That’s why Branch has this simple advice for maximum adherence: “Don’t risk it. Take a page out of the AI playbook and mechanize processes to stay out of trouble.”
Trying to be aware of, not to mention being compliant with, so many restrictions without the aid of automation isn’t just financially foolish, but it can lead to other deleterious consequences as well.
According to The Weed Initiate, incurred penalties can outstrip mere financial repercussions. “… You could also face full criminal liability, increased risk of federal prosecution, and expulsion from the cannabis industry.”
“When it comes to compliance software, this can be a make versus buy calculation, similar to a CRM,” says Branch. “Yes, off-the-shelf solutions work well for some companies. Meanwhile, other businesses invest in crafting their own CRM to fit their specific requirements. Neither is right or wrong so long as they serve the organization’s needs.”
To Branch’s point, a host of software now exists to enable CannaBusinesses’ peace of mind when it comes to activities such as GPS tracking, RFID barcoding, inventory traceability and license management. Whatever form of automated compliance a business elects to use, it’s crucial to integrate it into both the technical and physical environment to garner the best ROI.
Invest In A Data Infrastructure Around Cash
Conventional banks don’t lend money to CannaBusiness due to federal restrictions. This poses uncommon problems, but, according to Michael Hawkins, CFO of the Medical Cannabis Innovations Group, “solutions and creative financing work-arounds do exist.”
This is where AI comes in handy, as the more a company can invest in its infrastructure, particularly understanding and tracking its cash on hand, the greater its ability to leverage such data in the future.
To understand how this works in practice, Branch suggests CannaBusinesses construct a roadmap around capital data sets.
“Spend time understanding this guide,” she says. “Not just year one, but years two to three. Make certain the technology you invest in will allow you to collect and mature your data landscape overtime.”
Not only with this help from a consumer perspective, but also along all supply chain levels. Why? Collecting data about which suppliers are most reliable, as well as which one possess the best product and pricing, will produce patterns allowing for critical insights. Over time, these may lead to additional growth opportunities.
Still unconvinced that the money is in the data? Consider Headset. An analytics service provider, the company offers complex data so that businesses can better track their operations, including point of sale. This is especially helpful in the short-term by preventing out-of-stock debacles. Likewise, as the name suggests, Cannabis Big Data can also serve a useful analytic purpose. This company offers actionable insights stemming from public and proprietary sources to enhance revenue and lower costs.
Create Value Within A Supply Chain
Data analysis is something humans — and now AIs — can do to some extent. However, the real growth opportunity here exists for humans willing to do what they do best — and what AIs may never be to do at all; take action by integrating disparate information sources. Once a company can successfully understand its data, it is in its best interest to identify opportunities to be of help to others, especially along its supply chain.
To aid with this suggestion, senior management should ask itself, “Do we possess analytics we could share with the supply chain for greater insights?” The more (actionable) information a CannaBusiness can offer its supply chain, the more beneficial it will become to its partners, which can lead to greater efficiencies and revenue.
Ultimately, reciprocity goes a long way, especially in cannabis; a growth industry composed of interlocking relationships at every level. The more value a business can bring — not to just its immediate customers, but to its associates — the more poised for success it will be.
“Of all the tips this is the most important because it requires critical thinking,” says Branch. “Too often people misperceive A.I. as an intelligence agent divorced from human interaction. However, the savviest individuals and companies working in AI today realize its greatest benefit is its integration with human activities.”
The more CannaBusinesses begin to view tech as a reliable partner, the better positioned those businesses will be to take advantage of the high times now and in the future.