Inventory management is the most important factor in cannabis retail operations.

Organizing cannabis inventory by type (flower, edibles, concentrates, and topicals), potency levels, and methods of consumption (vapes, pipe/bong, rolled) is one method to consider.

Storage Procedures

Proper storage of products is important to maximize quality and shelf life, while also maintaining compliance with regulations. Although vintage cannabis and quality products are often thought of as being synonymous, proper storage will help maintain control over the environment and preserve the product’s quality. Flower products can be stored in a climate-controlled environment to ensure there are no quality compromises (55-65% humidity, 60-70 degrees Fahrenheit). Products need to be stored separately to avoid cross-contamination and flavor changes.

Tracking and Reporting

All jurisdictions have mandatory seed-to-sale tracking systems, so accuracy in documentation is vital. Utilizing barcodes connected to a state’s tracking database will ensure that every product movement is documented.

Organize products by batch number and/or harvest date to maintain acceptable rotation and fewer discrepancies with regard to product quality. The first-in, first-out (FIFO) rule assists with preventing product degradation and ensures customers are getting the freshest product.

Digitally Integrated Systems

An inventory management system will work in conjunction with a point-of-sale system and provide average inventory counts in real-time, while also notifying management when inventory levels are eligible for re-ordering products. These systems will also track typical sales patterns and demands and will help make ordering easier. Cloud-based inventory systems encourage product management from multiple locations, while knowing your data is safe and protected.

Employee Training and Protocol

Providing employees with proper training related to cannabis inventory will ensure regulatory compliance and consistency. Set protocols for receiving product shipments, updating the inventory counts for products, and documenting damaged or broken products. Schedule regular refreshers and updates to training to keep employees informed about products and regulations that are always changing.

Seasonal Factors

Cannabis consumption trends and consumer behavior seem to follow seasonal cycles throughout the calendar year. Customers may consume more cannabis-infused products over the holidays than during the summer period. Dispensaries should stock more products related to seasonal outdoor harvests and diversify their product selections (cannabis-infused foods and drinks) based on historical buying patterns and recent experience.