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Cannabis.

Competition is increasing in the cannabis industry: How your ERP helps

By | Cannabis, ERP, Sage X3 | No Comments
Cannabis.

Increasing competition makes it critical that cannabis businesses use ERP tools to thrive.

In 2019, Illinois became the 11th state to legalize recreational marijuana sales, with more states placing the issue on ballots or in front of legislators.

As the cannabis industry evolves, it is becoming increasingly similar to other product areas. Brands are beginning to matter, especially as larger cannabis entities purchase dispensaries and growing areas.

Cannabis companies of all sizes need sophisticated software solutions that provide the functionality that lets them be competitive and build a unique brand. Enterprise resource planning (ERP) solutions are an important way to integrate operations, inventory management, strain management, sales and compliance into one cohesive structure.

Competition is increasing in the cannabis industry. How your ERP helps can make all the difference.

State of the cannabis industry

Illinois’ action means the state joins 10 others, plus the District of Columbia, in legalizing recreational cannabis sales to those over 21. Thirty-three states have legalized medical marijuana. In October 2018, Canada became the first G7 country to legalize marijuana federally while Mexico’s Supreme Court ruled recently that prohibiting marijuana is unconstitutional.

According to Marijuana Business Daily, the retail cannabis industry is on pace to increase by as much 35 percent in 2019 compared to a year earlier, eclipsing the $12 billion mark by the end of the year. The website projects that sales of medical and recreational marijuana could reach more than $30 billion as soon as 2023.

The industry’s financing structure is also shifting rapidly, with more private equity being injected into cannabis businesses. That’s because cannabis investors are looking to get higher investment returns, a shift in just two years to a loan-based investment strategy.

According to the 2019 Marijuana Business Factbook, cannabis investors are making the following investments in 2019 compared to 2017:

  • Equity investments (78% versus 61%)
  • Public stock purchases (48% versus 52%)
  • Private equity or managed funds (26% versus 18%)
  • Interest-bearing loans (22% versus 37%)
  • Company purchase (15% versus 12%)

The optimistic financial outlook means not only more forays into the cannabis industry, but more hiring too. Marijuana Business Daily projects a 34 percent increase in full-time employees in 2019 over 2018 levels, potentially exceeding 200,000 workers nationwide. For some context, the website notes, “that’s more than the number of flight attendants in the U.S. and more than double the number of veterinarians.”

The employment gains are driven largely by the expansion of California’s marijuana market and the increasing number of new states approving recreational or medicinal use or both. Employment is projected to reach 385,000 to 475,000 by 2023.

What’s driving competition in cannabis?

Competition is fierce in the cannabis industry. Here are a few of the core drivers:

  • Customer Expectations. With more locations from which to purchase products, more information available and the opportunity to price shop, customers can afford to be picky despite the high demand.
  • New Product Mix. Flower is no longer the primary product sold in most cannabis businesses. In 2018, vaping overtook flower as the most popular mode of consumption. Other popular methods of using cannabis include:
    • Edibles. Gummy sales grew by 925 percent in 2018. Chocolate edible sales increased 166 percent and CBD chocolate sales jumped 530 percent. BDS Analytics’ tracking of retail sales in 2018 in Arizona, California, Colorado and Oregon revealed the following breakdown of edible sales:
      • Candy (44%)
      • Tinctures (17%)
      • Chocolates (15%)
      • Infused foods (11%)
      • Pills (7%)
      • Beverages (5%)
  • Beverages. While technically an edible, beverages are poised for a breakout year. Anheuser Busch and Coca-Cola are just two of the well-known international brands that are considering CBD-infused beverages. Some companies are pitching hangover-proof beer that includes THC. Lattes and smoothies are on the market, too.
  • Medicinal Products. Balms, salves and lotions that contain cannabis oil continue to be popular.
  • Social Acceptance and Consumption. BDS Analytics research notes that 71 percent of consumers use cannabis for social or recreational purposes, with 32 percent consuming products before getting together with others, 28 percent attend a public event after consuming and 18 percent consume in public. Users noted the following as popular consumption reasons:
    • A date night (or day) activity (41%)
    • Daytime fun (41%)
    • Celebrating special events (38%)
    • Going out or letting loose (37%)
  • Changing Demographics. The aging Baby Boomer population is an important demographic. They are more likely (67 percent) to consume cannabis to replace prescription or over-the-counter medications to ease aches and pain than to use for recreational purposes (59 percent).
Cannabis oil.

Oils, food products and soft drinks are emerging product lines for cannabis companies and large corporations.

Why branding matters for cannabis companies

Branding is becoming an increasingly essential factor for cannabis success. With medical or recreational marijuana use available to more than half of the U.S. population, competition is ramping up.

There are also more cannabis derivatives being used for products. While Cannabidiol (CBD) is the most common, others are making a mark, including:

  • Cannabigerol (CBG), which is non-psychotropic and can be used in pharmacological and industrial hemp applications
  • Cannabinol (CBN) is mildly psychoactive
  • Cannabichromene (CBC) has pharmacological potential for its anti-microbial, anti-inflammatory and anti-depressant properties.

As more research is done, it’s likely that farmers and companies will begin to develop cannabis versions rich in one of these components, causing prices to drop and competition to soar.

Other factors influencing the importance of branding include:

  • Industry disruption. Cannabis companies are poised to be a disruptive force in the coming years, becoming a player in industries and markets such as pharma, spirits and consumer goods.
  • Big Pharma. With so many potential healing properties, large pharmaceutical companies are already making investments in cannabis.
  • Regulatory pressure. As more states legalize cannabis, there will be increasing calls to remove cannabis from the list of Schedule 1 drugs. In late 2018, the U.S. Drug Enforcement Administration removed some cannabidiol drugs with THC below 0.1 percent from Schedule 1 to the less restrictive Schedule 5.
  • Volume. As the number of dispensaries and clinics increases, the ability to differentiate will become more essential. To separate a cannabis business from the many nearby competitors will mean a strategic, integrated branding effort.
  • Normalization. Cannabis companies are increasingly mainstream, appearing in heavily trafficked retail locations. For example, in February 2019, Simon Property Group, the nation’s largest shopping mall operator, inked a deal with Green Growth Brands to open 108 retail stores.

“For cannabis companies, opening over 100 dispensaries across the country would be a dream come true. Instead, most have had to adopt a slower approach of either building or buying out multiple dispensaries in each state,” noted a recent article. “Many of these stores also aren’t built on prime real estate. The competition is fierce, and companies with brands that are most influential with buyers are the ones that win these locations.”

Technology makes an impact on cannabis companies

For cannabis companies looking to compete in the increasingly competitive, regulated and crowded industry, differentiation is essential. Having the right ERP solution in place is an important step to providing you with the insights and synergies to stand out.

Here are some of the major benefits of having an ERP designed for your cannabis business:

  • Integrated Functions. With a cannabis ERP, your financial, manufacturing, compliance and inventory functions will be fully integrated, giving you more details and transparency for every component of your business.
  • Real-Time Data. A cannabis ERP lets you enter, extract and report on data in the moment of need, giving you and your employees accurate and up-to-date information.
  • Regulatory Obligations. While cannabis is still illegal at the federal level, states and local jurisdictions are adding, evaluating and modifying regulations frequently, often around inventory control and tracking documentation. Your cannabis ERP can provide you with the functions to ensure audit trails, reporting and tracking of plants, lots and sales are comprehensive and available when needed.
  • Cultivation Management. Cannabis businesses have unique needs for their operations. You need an ERP that will track, record and report on growing conditions, moisture, light, pesticides, nutrients at each stage, from germination to harvesting.
  • Traceability. From seed to sale, you need to have information on the sources, products and uses of each plant. This documentation may be necessary for compliance and it helps provide valuable insights that can be used to improve growing, optimize products and understand your customers.

Sage X3 is the right solution for your cannabis business’ needs. The cloud-based ERP is built to provide the features necessary to differentiate your company in the highly competitive and growing industry, including:

  • Corrective Action/Preventable Action (CAPA) management
  • Seed-to-sale traceability
  • Warehouse, supply chain and logistics management
  • Crop management
  • Inventory management
  • Integration with government regulatory systems
  • Staff management, task assignments and labor cost analysis
  • Distribution management
  • Cost accounting
  • Tax regulation management
  • Fast recall management
  • Production scheduling
  • Integration with point-of-sale (POS) solutions
  • Analytics that compare actual production to projections to improve strain efficiency
  • Quality control functionality
  • Product demand forecasting
  • Customer management

NexTec is the leading business software consultancy, helping companies select the right ERP solution to meet their unique business needs. With NexTec and Sage X3, you have proven expertise in the development, implementation, integration and optimization of a cannabis ERP that will transform your business.

Learn more about technology that runs your CannaBusiness.

Marijuana Business Factbook

Marijuana Business Factbook: Get the most complete guide to the cannabis industry

By | Cannabis | No Comments

Marijuana Business FactbookThe pace of change in the cannabis space is practically unrivaled, meaning information that was current just 6 months ago is already outdated. But the editors at MJBizDaily have you covered.

The 7th edition of the Annual Marijuana Business Factbook has all the latest state-by-state updates, market data and outlook to keep you consistently informed. Purchase your copy now and receive quarterly updates until 2020.

The 7th edition of the Annual Marijuana Business Factbook includes:

  • 112 New & Updated Charts – take advantage of projections and findings on sales, employment and investment data
  • Industry Trends and Market Analysis – explore and pinpoint new business and investment opportunities
  • Key Data and Metrics – identify and explore insights into your competitors’ business
  • Over 150 Pages of State by State Legal and Regulatory Updates – get a complete look at the legal landscape in the United States
  • Business Intelligence and Insights – avoid common cannabis business mistakes

Purchase your updated copy of the Annual Marijuana Business Factbook at mjbizfactbook.com or call Marijuana Business Daily directly at (720) 213-5992×1. Plus, use promo code NEXTECFB50 to save $50.00 on your factbook purchase.

Interested in learning more? Download the Complimentary Excerpt of the 7th Edition.

Person in a warehouse typing on a tablet.

What cannabis distributors do and how Sage X3 helps

By | Cannabis, ERP, Sage X3 | No Comments
Person in a warehouse typing on a tablet.

Cannabis distribution companies need ERP solutions that simplify complex business operations.

As the demand for cannabis products continues to climb dramatically, distribution companies have become a more essential component of the supply chain. As cannabis distribution companies become more prevalent, there’s an increasing need for powerful business management solutions.

Distribution software, such as enterprise resource planning (ERP) products, are among the most valuable for the emerging cannabis distribution field. Here’s a closer look at what cannabis distributors do and how Sage X3 helps.

Why the cannabis industry needs distributors

Just like in any complex, large-scale industry, the cannabis business finds itself needing distribution management partners. Doing so allows growers, dispensaries, and makers of concentrates and edibles focus on core business needs.

In many cases, distributors act simply as third-party shippers. However, others have begun to specialize in raw flower to sell to both manufacturers and dispensaries. Others act more broadly, offering a range of products.

Cannabis plants and glass container with oil.

Cannabis distributors need to track many details about plants and products.

The need for robust cannabis ERP solutions

As the cannabis industry generally and distribution specifically continue growth patterns, business management solutions become more urgent. Consider, for example, the business functions that growing distribution companies need:

  • Inventory management. Regulators, law enforcement and customers expect rigorous controls to document and track product.
  • Regulatory compliance. Distributors, like other players in the cannabis industry, are open to significant compliance mandates across multiple jurisdictions. The right ERP can track the various mandates and automate the data collection and reporting required.
  • Quality assurance. Distributors need to be able to track batches to ensure that products can be traced back to producers, especially for those that fail QA checks. Packaging and labeling are other functions that require accuracy and precision, pulling from data stored in a cannabis ERP.
  • Tax collection. Distributors in many jurisdictions are responsible for collecting cultivation and excise taxes and remit payments to taxation authorities. Your ERP needs to provide tools to document rates, payments, banks and other details.
  • Sales and marketing. Distributors are able to market on behalf of cannabis producers
  • Business intelligence. Distributors know what’s selling and what’s not. They can provide valuable data to cultivators on sales, volume and price.

Without an ERP designed to support the cannabis industry, your distribution company will need to pay for customizations or add-ons that add complexity and cost to your business.

Selecting the right cannabis ERP

When choosing a cannabis ERP for your distribution company, you want a company that understands your industry. With Sage X3, your business can deliver what’s necessary for success. Among the key functions of the Sage solution are:

  • Seed-to-sale traceability
  • Inventory tracking
  • Automated compliance tools, including integration with state and provincial regulatory systems
  • Environmental data tracking
  • Financial management
  • Shipment coordination
  • Customer and product analytics
  • Forward and backward traceability

Sage X3 has been at the forefront of cannabis business management solutions. NexTec helps cannabis businesses with the deployment and optimization of cannabis ERP software.

NexTec helps companies assess their critical business needs and select the ERP solution that solves business needs. Take a free tour of Sage X3 to learn more.

MJBizCon Int’l – Toronto

By | Cannabis, Events | No Comments
Person trimming a cannabis plant.

End of cannabis prohibition presents unique challenges to ERP delivery

By | Cannabis, ERP | No Comments
Person trimming a cannabis bud.

From harvesting to selling, cannabis companies have an array of unique challenges in the rapidly growing industry.

Few sectors have faced the unique challenges as the nascent cannabis industry. A product that was nearly completely illegal was suddenly legalized. That has set off a wave of complexities regarding supply chain management, inventory control, finances and compliance.

Cannabis companies find themselves facing complicated business processes, regulation, massive demand and growth, and a highly active climate for mergers and acquisitions. That’s why many businesses deploy industry-specific enterprise resource planning (ERP) solutions, designed to simplify the complex with tools, modules and features designed to address critical needs for cannabis companies.

Overall, it’s requiring cannabis companies to look for ERP partners that are nimble, adaptive and responsive. It’s also why the end of cannabis prohibition presents unique challenges to ERP delivery.

The ever-evolving cannabis landscape

As more U.S. states legalize medical and recreational marijuana and Canada legalized cannabis at the federal level, the number of businesses proliferates. Demand has been exceedingly high, with long wait times and rapid expansion for many cannabis businesses.

In 2018, the Brightfield Group released market analyses that the global cannabis industry was worth $7.7 billion (USD) in 2017 and was projected market lone projected that the global cannabis market would reach $5.7 billion in 2019 and $22 billion by 2022. That market expansion is projected at a compound annual growth rate (CAGR) of 60 percent.

Here’s another perspective on the scale of growth: the rising number of products. In 2016, the average dispensary had 94 different kinds of marijuana products available. In 2018, that average had grown to more than 150.

New businesses are changing quickly

Cannabis companies that have been open for business for just a few months are finding the demand is there to support growth. That’s meant companies are transforming from single sites to having a global presence in all regions of the world seemingly overnight.

Consider these stories making headlines in the past few months:

  • The Chicago Tribune reported that at least half a dozen cannabis companies have moved (many from the suburbs to the city) or expanded their headquarters, in some cases doubling their space.
  • Cannabis company Grassroots raised $90 million in venture capital, in part to expand operations from its 11 states to include locations in Illinois, Maryland and Pennsylvania.
  • Harvest Health & Recreation agreed to purchase CannaPharmacy, which has cultivation, manufacturing and retail facilities in four states. Terms were not disclosed.

What does this growth and expansion mean? An increasingly competitive industry with companies fighting for market share and faster speed-to-market rates.

Person looking at a cannabis plant.

Cannabis companies face varying regulations by jurisdiction, requiring precision data management and reporting tools.

Business challenges lead to consulting challenges

With an industry that’s essentially brand new and new companies popping up regularly, it’s a wild ride within the cannabis vertical. Most companies do not have an existing business model or well-established business models.

There’s also a lack of experienced industry professionals, especially given the newness of the industry. Coupled with evolving laws and regulations that differ widely from jurisdiction to jurisdiction and you have an industry that needs guidance and support.

These companies are seeking help from experienced advisors, meaning that business and management consulting in the cannabis industry has become an ongoing requirement, not just a temporary solution to handle implementation and launch.

“This is a lot of new information when you’re vying for your place in the cannabis industry. That’s why some businesses are turning to consultants to help, notes the Cannabis Industry Journal in a recent article. “Consultancy is a great and time-tested way to grow your businesses and keep a competitive edge. But just like every other industry, when you choose a consultant, there are specific things to look for and avoid.”

The journal suggests that businesses heed the following when searching for a cannabis consultant:

  • Understand expertise. Very few consultants are experts at all components of the cannabis business. You may need several different consultants to get the expertise you need in cultivation, manufacturing, dispensary operations, food safety, transportation, compliance, legal, finance and accounting, and human resources.
  • Know what success looks like. You need to set your own goals, which your consultant can help refine. The consultant can then work with you on the plans, processes, capital, permitting and operational changes necessary to achieve those goals.
  • Focus on what you need. Be sure you know exactly what you need help with, be it operations, inventory control, ERP software selection, cultivation management, pricing or product development.
  • Ask smart questions. You want to probe for the answers from potential consultants that will help you make an informed decision, including:
    • Relevant experience
    • Client references (past and present)
    • Time to be spent on your company
    • Timeline and planning process
    • Responsibilities and deliverables for both parties
    • Certifications and credentials, if applicable
    • What’s included in the fee and what add-on charges are
    • Any conflicts of interest, especially with competitors
  • Avoid questionable conduct. If your consultant does one of the following, look elsewhere:
    • Asks for equity as payment
    • Does not provide references
    • Avoids questions
    • Refuses to track time or itemize costs

Cannabis consultants need to keep pace and be ready to support rapid expansion and growth, along with global delivery of services. Consultants need to stay on top of the ever-changing legal environment, market, political landscape and company priorities.

They should understand and be adept at reducing the time to market for your company and its products. They also need to be conversant on the complexities of partner management in regions of delivery and emerging legislation.

One important area to consider is supply chain management. Rapid growth, demand for new products, and constantly evolving consumer tastes and preferences means there’s increasing pressure for more efficient and transparent supply chain processes.

Retail cannabis purchasing managers are spending too much time with antiquated (or non-existent) inventory management tools that make buying difficult to manage. Order management, quality control, integrated tax and sales functions in a cannabis ERP help company leaders make better decisions in the moment of need.

The complexity of compliance

Compliance comes in many forms for cannabis companies, with regulations emerging and changing at the local, state/province, federal and international levels. It can create a swirling array of different mandates, reporting requirements and data points in order to remain compliant.

The constant regulatory swirl means building a cannabis ERP architecture that can meet the myriad laws regarding privacy (including the General Data Protection Regulation (GDPR) requirements for residents of the European Union and stricter data privacy laws passed in 2018 in California. Privacy is likely to continue to be a major factor as ore jurisdictions take legislative action to protect people and their information.

That’s on top of regulations related to food safety, personal medical information and banking restrictions.

The cannabis industry is fraught with potential pitfalls that can trip up well-intentioned businesses. Here are a few of the most common issues that cause compliance problems:

  • Inaccurate or missing data. Each jurisdiction will have its own reporting requirements and mandates, and these various guidelines may be very different from each other. Your business needs an ERP that can track when sales receipts, inventory records and safety plans need to be submitted and in what format.
  • Poor inventory management. Inexplicable missing stock or inventory discrepancies can lead to severe fines and the potential loss of licenses to operate. Whether due to poor quality assurance, human error, employee theft or incorrect packaging, bad inventory control protocols and a lack of sound distribution management software can have serious consequences.
  • Illegal sales. Selling to underage persons, selling outside of approved operating hours or exceeding daily sales limits per customer can trigger compliance issues. Age verification, customer management and point of sale technologies can save major headaches for you and your employees.
  • Mislabeling products. Compliance mandates increasingly include rules about how cannabis products need to be labeled and packaged. Similarly, product safety laws must be followed, such as a California provision that all packaging be child-resistant and Colorado requirements that all edibles have a cannabis or THC warning.
  • Failing to pay taxes. Each jurisdiction has its own requirements for tax payments, including method of payment, timing and required documentation. A failure to follow your local tax laws can result in large tax bills, time-consuming and invasive audits and fines and interest levies for unpaid taxes.

Why the right cannabis ERP matters

Cannabis companies need industry-specific ERP solutions that address the rapid pace of growth, pressure to deliver on time and compliance issues that are all too common. They also need experienced partners to help guide them through the selection, implementation, training and optimization phases of software products that will improve efficiency.

At NexTec Group, we help companies in all phases of cannabis ERP decision-making. We help clients build implementation teams, establish change management plans, develop budgets, migrate data and train users.

Our consultants have deep product knowledge about the vendors and their products. We understand the features and benefits of each potential solution and help your cannabis business find the right solution to address your unique business needs. Learn more about technology that runs your CannaBusiness. by contacting NexTec Group today.

Additional cannabis ERP resources

Edibles at the intersection of cannabis and food ERP solutions

Genetic tracking of cannabis and how your ERP choice can help

7 Elements of ‘seed to sale’ and how your ERP choice manages them

Insight.

ERP plus CRM: More than the sum of the parts

By | Cannabis, Chemicals, CRM, ERP, Food and Beverage | No Comments
Insight.

Integrating operational areas with customer relationship data gives your company new insights and efficiencies.

Enterprise resource planning (ERP) and customer relationship management (CRM) solutions offer great tactical solutions to businesses. Taken together, however, ERP and CRM are more than the sum of the parts.

An integrated ERP and CRM solution allows for real-time, actionable business intelligence, giving executives insights they need to make critical decisions in the time of need. Integration breaks down organizational silos and encourages collaboration. Learn more below about the benefits of integrating these tools, industry-specific examples and best practices for combining your solutions.

Benefits of ERP and CRM together

While no two ERP or CRM solutions offer the same features, in general, the roles of each can be defined as follows:

  • ERP: Back-end functions such as accounting, human resources, manufacturing and purchasing.
  • CRM: Front-facing functions like sales, marketing, customer service.

ERPs are built to bring synergy to core functions, providing transparency, a single source of data and improved collaboration and efficiency. CRMs are focused on providing a complete view of customer and prospect integrations, including marketing pitches, outreach, conversations and customer help requests.

Both are designed to build synergy among important functional areas, with the intent that shared knowledge helps to boost operations and outreach. By combining capabilities, you’ll be able to deepen the interconnectedness of various parts of your business.

“The main arguments for the integration … focus on obtaining in real time a coherent view of customers – the possibility of continuous access to everything relating to customer data and information, which … is needed for its proper operation,” state the authors of a recent paper on ERP and CRM integration. “A consistent view of the customer allows employees to make the right and quick decisions.”

Here are a few of the most essential benefits of bringing ERP and CRM together:

Seamless data sharing

CRMs and ERPs have their own unique data collection, storage and formatting guidelines. The advantage of integrated systems is the ability to provide everyone with a unified, transparent and consistent set of information. When the two solutions are integrated, changes or alterations made in one system should be reflected simultaneously in the other.

As business needs change and new data, fields or calculations are needed, the connectivity allows for continued consistency. The system integration allows for new insights, needs and opportunities to be available to each operating unit.

Optimized resource management

Consider the opportunities with a clearer, automated flow of information from sales to production. Companies can gain advantages on production planning, warehouse space optimization, supply planning, materials purchasing and production order prioritization. This benefit helps companies with long sales and manufacturing cycles to plan better based on the status of customer commitments, allowing companies to reduce carried inventory and begin production soon after an order is confirmed.

Faster delivery cycles

Companies with a free flow of information can track and share information on customer details and orders, leading to more accurate and timely shipments, lower operating costs and improved customer satisfaction with on-time deliveries.

Improved product forecasting

Linking marketing initiatives and projections allows for faster and more accurate production forecasting. Operations teams will be able to plan more accurately and companies will not tie up cash by buying excess inventory.

Appropriate and accurate sales proposals

If your sales professionals can see a customer’s complete history – order history, current balance, payment pattern, credit limit and unpaid invoices – proposals will be more consistent and appropriate. Information that’s readily available helps sales managers to make informed decisions, such as asking for down payments or full payment up front.

Sales reps using an integrated solution also have access to the most recent, updated pricing information, including any promotions or discounts. They can also provide more accurate production and delivery dates by accessing production schedules, inventory levels and requisition schedules. If merchandise is out of stock, salespeople can relay that information to customers early on in the proposal process or provide precise projections on timing.

More sales opportunities

Giving salespeople better access to order histories, leads and customer service requests helps them to frame their pitches, giving them a much better likelihood of securing a call, an appointment or a deal. Knowing the frequency of reordering, for example, helps sales professionals reach out proactively to up-sell or cross-sell products or services. When equipment is reaching the end of its predicted lifespan, salespeople can suggest new models of an old product.

Better consistency and standards in customer engagement

With an integrated CRM and ERP solution, your employees will have complete and current information on customers. Whether it’s a sales call, a help request, a product question or a delivery inquiry, employees will understand better the complete relationship, sentiment and pain points. Complete and timely data, collected from both systems, helps employees understand and respond better to customers.

Responsive approval processes

Give your salespeople access to ERP information in real time and they can move contracts through the approval process faster. Same-day signing means faster contract approvals and reduces the time it takes for revenue to be recognized.

Prompt billing and payments

Document sharing lets businesses quickly turn accepted proposals into work orders that can be tracked throughout the enterprise without manual intervention. This process simplification carries over to the finance functions, allowing for faster creation and distribution of invoices, drawing from a single data source. Faster billing leads to faster payment turnarounds and better cash flow.

Consolidated reporting

Combined systems allow for better and more automated reporting, visualizations and data analysis. Reports pull in data from both systems without the need for manual manipulations, conversions or adjustments.

Linking icons.

Applying ERP and CRM data has powerful functional advantages in the food, chemical and cannabis industries.

ERP and CRM industry applications

ERP and CRM solutions need to be uniquely suited to the industry they’re serving. Businesses like food and beverage production, chemicals and cannabis have unique functions and needs for both systems separately and together.

Here is a look at how ERP and CRM integration gives companies in those industries the capabilities essential for success and competitive advantage.

Chemicals

Chemical companies need solutions that address complex functions, including:

  • Formula and recipe management, measure conversions, shelf-life management, packaging and labeling
  • Rapid batch scaling in different sizes and formulations
  • Quality controls that can track – and report to customers and prospects – product quality, shelf life and expiration dates
  • Process design improvements based on customer needs, historical trends, costs and operations
  • Rigorous regulatory compliance mandates, including federal, international, state, local and industry standards
  • Lifetime customer value measurements
  • Worker safety
  • Tracking products from warehouse arrival to manufacturing processes (including intermediary products) to finished goods
  • Traceability forward and backward with ordering histories and delivery data

For process manufacturers, these systems allow for shared, real-time access to information that is valuable to the salesperson, marketing manager, warehouse chief, finance officer and executive.

Food and Beverage

Sound supply chain management is at the core of any successful food or beverage company. While these functions traditional reside within ERP solutions, a CRM integration provides even more opportunities for efficiency.

With tight margins, fierce competition and changing consumer tastes, efficiency is paramount. By integrating the customer relationship insights with operational details, food and beverage companies are able to leverage the three interconnected supply chain components – suppliers, stores/restaurants and customers.

Here are three benefits for food and beverage companies when their CRM and ERP solutions are integrated:

  • Lower operational costs. CRM tools help provide insights and ordering patterns that can improve ordering and inventory management, resulting in lower storage and spoilage costs.
  • Customer segmentation. Targeted sales by customer segments allow for optimized ordering based on demand, relevance and location. Segmentation also allows for better analysis of customer profitability, based on logistical and operational costs. Customer analysis helps finance, sales and operations teams to identify and distinguish between stable, regular business and variable or unpredictable customers.
  • Seasonality. Identifying ordering patterns allows for sales and procurement employees to track, predict and anticipate seasonal variances in demand.

Cannabis

With cannabis and CBD companies emerging and growing as more states approve medicinal and recreational use, businesses in this fledgling industry are seeking solutions. There is a critical need to manage the operational and customer sides, not only for better efficiency and profitability, but also to meet the scrutiny of law enforcement and regulatory agencies at the state and local level.

Cannabis companies need to track and access industry-unique data, such as the costs of materials and energy, growth rates, potency levels and cross-strain breeding attempts.

Integrating this information with customer demand, buying patterns and demographic data helps cannabis companies provide products that are most in demand and most profitable. Pricing, resource allocation and purchasing all benefit from a blending of customer and production data.

How to combine

Combining these two complex business solutions to maximize the potential of an integrated approach is a complex undertaking. Whether buying new solutions or integrating new ones, careful planning needs to happen. Among the key steps are:

  • Determining whether the integration is unidirectional or bidirectional
  • Identifying data and modules to integrate
  • Unifying headers, labels, tags and data formats
  • Mapping data and interfaces
  • Assessing existing and future reporting needs
  • Focusing on user experience
  • Training users

To manage the many complexities involved in developing a cogent integration strategy, companies turn to NexTec. Our integration specialists have extensive knowledge of the providers, solutions and features available and the expertise to deliver a seamless integration experience.

Take a free tour of Sage Enterprise Management to learn more about NexTec and ERP/CRM integration.

Additional CRM resources

Integrate CRM and ERP for more sales with lower costs

5 Best practices for customizing your CRM

Why Salesforce integration makes your ERP solution better

Cannabis cookies and cannabis leaves.

Edibles at the intersection of cannabis and food ERP solutions

By | Cannabis, Food and Beverage | No Comments
Cannabis Cookies with cannabis leaves.

Cannabis-infused cookies are a popular choice among consumers. Keeping them safe requires the right ERP solution.

As the cannabis industry grows, one of the most popular product categories is edibles. Such products are cannabis-infused foods and beverages that are consumed either for recreational purposes or to treat a health issue. They include candies, cookies, energy drinks, gummies and teas.

The issue of food safety is a complicated one for cannabis companies. In states where these products are approved for sale, there may be some local regulations and guidelines. However, with the absence of federal regulations, many businesses struggle to determine how to address food safety.

That’s where enterprise resource planning software (ERP) can play a pivotal role. With an ERP designed for the cannabis industry, you can address key food safety issues and be prepared for future regulations at all levels.

Here is a look at edibles at the intersection of cannabis and food ERP solutions.

Approaches to food safety compliance

Food safety for cannabis companies can touch on multiple issues, including some common to food and beverage businesses, such as:

  • Inaccurate labeling
  • Food-borne pathogens
  • Disease outbreaks

In addition, there are issues unique to the cannabis business sector, including:

  • Extraction methods
  • Bacteria and mold growth
  • Pest and pesticide contamination
  • Chemical exposure
  • Employee handling
  • Unintentional consumption or overconsumption of edibles

The consequences of a food safety event are potentially substantial, including liability and damage to reputation and public perception.

Some cannabis companies take a conservative approach and follow guidelines established by the U.S. Food and Drug Administration. The Food Safety Modernization Act establishes guidelines for manufacturers to use for identifying and addressing risks, sanitary transportation and certifying foreign suppliers.

For cannabis companies it’s complicated. Without federal regulation for such businesses, the FSMA does not apply. Yet states and municipalities have their own unique regulations and restrictions, meaning companies need to be mindful of many different guidelines to remain compliant.

Cannabis candies and buds in a glass jar.

Companies need to ensure that gummies, teas and chocolates containing cannabis are safe to consume.

Food ERP solutions and cannabis companies

Cannabis-specific ERPs help by providing the structure, integration and processes necessary to follow best practices for food safety. Here are some of the critical ways a cannabis food ERP can help:

  • Seed-to-sale management. Tools that track plants forward and backwards at every stage of growth and processing allow for specificity and detailed reporting.
  • Inventory management. Automation tools help improve the tracking and recording of important inventory data, including expiration dates, product quantities, RFID plant tags and serial and lot numbers. These data points help manage inventory levels, recipes, labeling, quality control, supply chain management and traceability. The tools also can automate accurate product label creation, expiration dates and testing for contaminants.
  • Recipe management. One challenge for the cannabis industry is the inconsistency of taste, texture and smell from batch to batch. Your food ERP should include recipe and formula management functions that track raw materials, revision history and production notes.
  • HACCP planning. The Hazard Analysis Critical Control Points planning details procedures to protect consumers from chemical, physical and biological dangers. Incorporating control points into your ERP lets you prevent and control hazards before they affect food safety.

Choosing the right cannabis ERP

NexTec provides cannabis companies with insights and industry knowledge to identify the right food ERP solution. Learn more about technology that runs your CannaBusiness.

Additional cannabis ERP resources

End of cannabis prohibition presents unique challenges to ERP delivery

ERP choice affects batch and lot control in the cannabis industry

How emerging cannabis businesses benefit from the right ERP system

Cannabis plant.

Sage X3 for the cannabis industry

By | Cannabis, Sage X3 | No Comments
Cannabis plant.

An enterprise resource planning solution helps cannabis companies meet demands for traceability and compliance.

The cannabis industry is experiencing extraordinary growth as more jurisdictions allow for personal and medical use of products.

In this time of growth, many cannabis companies are grappling with complexity, unique operational needs, regulatory mandates and efficiency concerns. Businesses realize they need the right suite of enterprise resource planning (ERP) tools to address those challenges.

A closer look at those needs reveals that Sage X3 for the cannabis industry is the right ERP solution.

New Challenges for a New Industry

If you’re the owner of a cannabis company, you’re likely facing an array of challenges while seeing extraordinary opportunity in the growing industry. Having an ERP solution that is designed for the cannabis industry helps address many of those issues, including:

  • Customer Analytics. Understanding your customer base is essential for any business. As cannabis companies grow and expand their market share, they need tools that provide them insights about product popularity, demand iand profit margins. Leveraging the data from yields, materials, sales, marketing and spending habits helps shape product selection, pricing and customer service.
  • Traceability. Cannabis companies have an obligation to track information about strains, growing conditions, product ingredients and customers. This responsibility requires transparency throughout the supply chain to meet customer expectations and the scrutiny of regulators and law enforcement. Distribution management software and analytical tools that are designed for the cannabis industry allows for seed-to-sale efficiencies, data collection and reporting.
  • Compliance. Most cannabis businesses are under the watchful eye of state and local regulations. There are also restrictions on banking, THC levels and pesticide use on plants. Complex tax guidelines also need to be followed. IN short, cannabis companies need systems that collect and report on data with precision, available in the moment of need and accurate. The right ERP solution gives your company the tools to meet myriad regulatory mandates and remain compliant.
  • Competition and Big Cannabis. As your business grows and demonstrates profitability, it becomes a target for other competitors eager to get a piece of the action. Large cannabis enterprises are purchasing and managing smaller operations. To be attractive to potential buyers and stave off the competition, your cannabis business needs a solution like Sage X3 that integrates financial, customer and product information to allow for better insights and decisions.
Cannabis oil.

The right cannabis ERP helps your company optimize growing conditions for better yields and to meet customer demand.

What to Look for in a Cannabis ERP

Sage X3 is a web-based ERP that offers the features necessary to run a successful cannabis business. The Sage solution includes modules that focus on financial management, supply chain management, production management and reporting and business analytics.

This powerful suite of applications delivers needed solutions for your business, including:

  • Crop management
  • Corrective Action / Preventable Action (CAPA) management
  • Seed-to-sale traceability
  • Inventory tracking
  • Integration with government regulatory systems

NexTec Group partners with Sage to offer customers the tools and functionality they need to succeed. NexTec has developed a powerful set of add-ons, called CannaBusiness ERP, that enhances you Sage X3 solution

NexTec has developed powerful tools that work in tandem, with the Sage X3 solution. Called CannaBusiness ERP, it’s a powerful set of add-ons that allow for more enhancements to the Sage Business Cloud product, including grow operations and optimization management, production scheduling, product forecasting and quality control.

Learn more about technology that runs your CannaBusiness.

Additional resources

Genetic tracking of cannabis and how your ERP choice can help

ERP choice affects batch and lot control in the cannabis industry

How your ERP is a competitive differentiator in the cannabis industry

Hand with cannabis buds.

Genetic tracking of cannabis and how your ERP choice can help

By | Cannabis, ERP | No Comments
Hand with cannabis buds.

Advances in genomics make it easier to map the effects of various cannabis strains.

Business management software in the cannabis industry has focused largely on seed-to-sale tracking, allowing companies to manage inventory, operating costs and pricing.

However, in the next few years, cannabis genomics is likely to become more critical for companies producing and selling cannabis products. Having the right enterprise resource planning (ERP) solution that can track and map those functions is essential.

Business leaders need to understand genetic testing of cannabis and how your ERP choice can help.

What cannabis genetic testing offers

Genetic testing has advanced greatly in the past two decades. Scientists are beginning to build a cannabinoid genome using advances in bioinformatics and DNA sequencing. Until recently, for example, little was known about which genes produced THC and CBD.

That has changed as we understand more about how the plant’s genetics work.

George Weiblen, a biology professor at the University of Minnesota, was one of the pioneers in cannabis genome mapping, starting in 2002. However, the U.S. Drug Enforcement Agency limited him to 25 plants at a time, and he had to establish the proper research environment and high-level security for the lab.

Weiblen’s work has paved the way for growers and sellers to leverage new potential.

Choosing for cause and effect

While breeders over the years have come to understand what different varieties can do to the mind and body, there has been classification system with scientifically proven and documented characteristics.

Better classification would allow consumers to find products with the genetic traits that are likely to produce the desired physical effects.

Customers looking for pain relief, for example, would no longer need to seek out varieties that only anecdotally are known for having analgesic properties. Companies very soon could begin developing products – including teas, snacks and other consumables – that could be used for sleep disorders, anxiety or sexual disorders.

Genome mapping can have other benefits for growers too. Flowering time, nitrogen use, drought tolerance and other characteristics could also be charted by strain to allow for better resource allocation and pricing decisions.

There may be other applications for the technology on the horizon, including the use of breeds for industrial hemp production, which is used in clothing, food and building materials.

Cannabis bud.

Businesses are now offering services that allow companies to better understand the genetic makeup of cannabis plants.

Business, the law and cannabis

Today, companies like Sunrise Genetics, a Colorado-based firm, are providing genetic testing services for cannabis companies for both personal and commercial use. Its services include plant identification, DNA marker screening and genomic-based breeding.

Growers also face a murky legal landscape with laws and regulations that vary by state. Some are looking to patent new breeding processes, breeds, products and production methods. As of December 2018, there were 61 patents issued with “cannabis” in the title. That number is surely to grow.

U.S. law allows for patents to be issued to plants. Whether the patents are enforceable remains to be seen.

Patent law is a federal issue. However, the DEA still classifies cannabis as an illegal controlled substance. In a lawsuit about patent infringement, a defendant could argue that federal law does not apply to an illegal substance.

On the other hand, patents could prevent anyone from growing patented plants anywhere.

Sorting it out with ERP

Your enterprise resource planning software should be one designed for the cannabis industry. Your ERP solution needs functionality that tracks seed-to-sale expenses and revenue, patient and customer management, inventory management. It also needs genetic tracking functions, allowing for the tracking of mother plants, clones, strains and genetic markers, with an easy correlation to sales information.

If you ever want to patent your work, having this documentation is essential.

At NexTec Group, we help cannabis companies select the right industry-specific ERP that helps manage and assess business operations.  Learn more about technology that runs your CannaBusiness and how NexTec can help.

ERP solutions

7 Elements of ‘seed to sale’ and how your ERP choice manages them

By | Cannabis, ERP | No Comments
ERP solution

Cannabis companies need solutions that integrate operations and data from seed to sale.

As more states legalize recreational and medical marijuana use, cannabis companies are finding increasing demand. These companies are looking for solutions that help them manage their enterprise, from seed to sale.

The need for a cannabis-oriented enterprise resource planning (ERP) solution has never been higher. By integrating data and access to information across all aspects of the company, cannabis companies can leverage considerable operational efficiencies and competitive advantages to using an ERP solution.

Here is a closer look at 7 elements of ‘seed to sale’ and how your ERP choice manages them.

Audit trails. Compliance is an important issue for cannabis companies that unfortunately is evolving rapidly and is likely to change frequently. States and local communities are adopting different requirements for cannabis sales. Your company needs an enterprise resource planning solution that can record and document all the different requirements. The solution needs to produce reports quickly for government regulators or law enforcement looking to ensure the business is operating properly.

Barcodes. Businesses need barcodes that can be scanned to track progress across multiple aspects of the seed-to-sale cycle. Your ERP should be able to track scanned information at every point from the time seeds are planted to finished products are purchased.

Inventory management. ERP solutions for years have included inventory management provisions that allow for accurate tracking and use. Cannabis companies need an inventory management tool that can determine what’s selling and whether adjustments need to be made to the strain that are grown or products to be stocked. Those analytical opportunities are just one of the reasons inventory controls are critical. If products go missing, it can be a major issue for regulators.

ERP solution

Cannabis-specific enterprise resource planning platforms address inventory controls, security and strain monitoring.

Point of sale. Your POS solution needs to be integrated into your ERP. POS software helps improve checkout times and improves accuracy, especially when tied into inventory management controls in real time. Accurate transactional data can be strategically important when deciding what to offer and how to price products. Tracking and storing this data is also a key element of most regulatory mandates.

Scales. Measurements need to be exactingly precise in the cannabis business. Some ERP solutions have built-in scales to ensure precision measuring and accurate tracking for inventory and audit purposes.

Security. Security is critical for cannabis companies. Access to data on customers and transactions needs to be protected as with any other retailer. Your platforms should have controls that manage access to products, sales and system information.

Strain Analysis. Cannabis companies have many strain options available to them for consideration. That’s why your ERP solution needs to have tools that will track seeds, plants and products by strain and correlate that information with growing costs, sales and pricing. You also want to be sure that you’re selling your customers the right strains as advertised.

Choosing the right ERP partner

Companies need the right partner to help in the selection of a cannabis-specific ERP solution. NexTec has partnered with leading cannabis experts to develop the CannaBusiness ERP software. Our solution addresses all of the 7 critical functions and provides our customers with seed-to-sale operational control.

With CannaBusiness ERP, your company can:

  • Manage grow operations
  • Process plants
  • Coordinate shipments
  • Maintain compliance
  • Trace and track plants
  • Manage patients and customers
  • Manage the supply chain
  • Ensure quality control

Learn more about technology that runs your CannaBusiness.