What are the biggest IT problems in the cannabis industry? (And how to solve them!)

Here are the top IT problems in the cannabis industry and how to solve them

Legal marijuana sales are expected to top $33 billion by the end of 2022. According to a recent study by MJBiz, a leading B2B cannabis industry resource. Forecasting a 32% increase from $25 billion in 2021.

They also project annual sales to surpass $52 billion by 2026.

The main problems in the cannabis industry are the non-integrated applications, regulatory compliance and the use of point-of-sale POS that take too much time.

As the cannabis industry grows at a rapid pace, the increasing importance of IT security, cybersecurity and managed IT services must be addressed. As they grow, experiences with technical problems become commonplace.

The legal cannabis market was worth $11.3 billion in 2020. Some experts are forecasting more than 30 percent maturation by the end of 2021. Growing the cannabis company comes with a notable challenge. It is federally classified as a Schedule 1 illegal drug. However, medical or recreational use (to varying degrees) is legal in several states. Currently, 33 states have legalized medical marijuana, with 11 making it legal for recreational use.

Regulations differ from state to state as there are several technological issues unique to the cannabis industry. Therefore, there are strict limits on the marketing of cannabis products by entrepreneurs. Because the industry is relatively new and growing, it is vulnerable to opportunistic data thieves. It’s easy to see that cannabis is big business now, which means all the growth issues apply here as well.

Let’s examine 4 of the most common technical issues faced by the cannabis industry.

data breaches

Few companies are scrutinized as extensively as cannabis. Bylaws can change with each election cycle and even from county to county in legalized states. Trying to manage and nurture a customer base while maintaining strict policies is challenging. As such, most cannabis professionals understandably do not have the closest connection to IT security or cybersecurity.

In 2015, a medical marijuana dispensary in Massachusetts suffered a data breach. The incident was easily avoidable. A staff member sent a group email to 157 patients without BCCing them. Therefore, this person has exposed all email addresses in the chain.

However, this isn’t just a situation unique to US cannabis-based business owners. Canada’s National Health Service experienced an attack by data thieves. They revealed the personal information of about 34,000 medical marijuana users. The need for IT services in the cannabis industry is a serious problem.

With more pharmacies opening every day, staying compliant with the law is a challenge. But the balance to a pleasant customer experience is also in the foreground. IT security is therefore an afterthought.

As the transmission of patient and customer data through POS devices and email servers increases, there are many opportunities for hackers to steal information.

Ecommerce

Doing business online is something that almost every industry can easily do. For cannabis brands, however, this is almost impossible.

While retailers can market CBD without THC online. The US cannabis status is federally illegal, which means that e-commerce cannabis sales are severely restricted.

After recreational marijuana was used in Colorado, licensed retailers reported nearly $1 billion in first-year sales. Later, CBD gummies and oils evolved into legal status for online sale.

Legalization brought a new problem. Previously, cannabis companies implemented a cash-only system. As a result, cannabis companies could now accept digital payments for products that do not contain THC.

The problem is that while marijuana legal varies from state to state, banks have to follow federal regulations. Financial institutions can risk criminal prosecution if they hold marijuana profits and sales.

There are also strict rules against advertising cannabis brands, especially on influential platforms like Google, Facebook or Instagram. Therefore, this creates a more difficult position for brands to gain influence and attract new customers.

Ecommerce platforms like Shopify are trying to bridge the gap in Canada. However, this challenge remains for many cannabis-based industries in the US. American companies will first study how Canada is dealing with this issue to see how pharmacies are dealing with e-commerce.

cryptocurrencies

Traditional banks are eschewing cannabis brands to comply with federal regulations. Many companies have switched to blockchain and virtual currencies like bitcoin to authorize customers to purchase products.

Many industry experts see cryptocurrencies as the solution to cannabis’ legally liquid status, but blockchain has numerous problems.

Cryptocurrency allows for easy and quick payments that can be converted into physical currency. There are even marijuana-specific virtual currencies like PotCoin and CannabisCoin. However, the main problem is that virtual currencies can vary widely and values ​​fluctuate rapidly.

Cryptocurrencies are also unregulated, which is risky for a growing industry that has already taken massive risks. The lack of standardization within blockchain currencies may hurt rather than help the industry.

automation

As the industry develops, so does the demand for automation. Gone are the days when individual farmers cultivated the plant in their backyard. Now cultivation is a remarkable part of the endeavor. Last year, the cannabis industry created nearly 65,000 jobs. Some experts call it the fastest growing job market in the US

To cultivate well, the marijuana plant needs regular attention, near-perfect light and water conditions. With so many plants, it is almost unthinkable for humans to carry out around-the-clock maintenance. Those who can afford it are funding the Internet of Things (IoT), which allows farming tools to manage farms for ultimate productivity. But as automation continues, many fear that owning machines will compromise quality due to a lack of personal attention and maintenance.

Many specialists also fear that over-reliance on mechanization could destroy the developing workforce. Therefore, machines oversee everything from temperature control to actual security, reducing the need for human workers.

With technology promising to revolutionize the ever-changing cannabis industry, these are some pitfalls to avoid and discussions to arise along the way.

How can K3 Technology provide solutions to the cannabis industry?

No matter how safe you think your cannabis K3 technology can help. We’ve outlined four problems your business might face with technology. If you encounter data breach, ecommerce, cryptocurrency or automation issues, let us help you develop a suitable plan.

K3 Technology offers security assessments to help you protect yourself from data breaches. The main problems in e-commerce are regulatory issues that you need to follow. Therefore, if you contact us, we can provide you with a strategic compliance plan.

Cryptocurrencies, on the other hand, are not regulated. However, the biggest challenge is market volatility. Therefore, there is hardly a solution other than to be well trained with our team from K3 Technology

The automation processes in the cannabis industry need to be technically improved. Therefore, K3 Technology’s expertise in automating business processes will help you take your business to the top.