Kudos for Acumatica: Champion ERP and MaxQ’s Solution Platform of Choice

MaxQ chose Acumatica ERP as the platform on which to build advanced business solutions because of its modern cloud-based design, integrated architecture, comprehensive feature set, user-friendly interface, advanced automation capabilities, and more.

It is therefore satisfying to see these same qualities recognized and validated by analysts and product reviewers in their evaluations of Acumatica.

Among the sterling reviews Acumatica received this year, PC Magazine UK  found Acumatica to be best in class, with the reviewer giving Acumatica a rating of “Excellent” as well as the Editors’ Choice Award.

The PC Magazine review found that “Acumatica’s intuitive design, enterprise scalability, and flexible pricing model help make Acumatica an excellent choice for enterprise resource planning, general ledger accounting, and inventory management.” 

Acumatica’s browser-based user experience (UX), said the review, “is excellent, with a feature-rich environment accessible via an intuitive user interface (UI).”

Top of the Leaderboard

Nucleus Research also found Acumatica to be a top-tier ERP leader in its recently released “ERP Technology Value Matrix” report. The report placed Acumatica atop the Leaders quadrant and praised Acumatica’s continuing refinement of its platform, finding that “high usability and flexibility are at the center of Acumatica’s development philosophy” as it continues to add features and automate processes.

Acumatica, said the report, “continues to lead the way in usability, serving several industry verticals, including commerce, manufacturing, and field service.” Nucleus also gave Acumatica accolades for its responsiveness to customers and focus on providing rich mobile capabilities.

Nucleus found that Acumatica’s latest version, released in September, “is bringing a host of incremental improvements to each of its vertical solutions focused on increasing customer satisfaction.”

Acumatica Shines at Summit 2018

IDC attended Acumatica’s Summit 2018 and spoke with company executives and customers. In its report on the Summit, IDC gave Acumatica high marks for its technology and customer satisfaction, finding that Acumatica has added “a significant number of new features and functionality with the release of Acumatica 2018 R1.” Based on interviews with Acumatica customers, IDC said it believed “Acumatica is well aligned with the market in terms of added features, channel momentum, and strategic road map updates.”

Like PC Magazine and Nucleus Research, IDC praised Acumatica for listening to its customers and making improvements to the Acumatica ERP platform based on customer feedback. Acumatica, said IDC, “took great effort to incorporate customer feedback into 2018 R1 even down to relatively small details like reducing the number of clicks while building a report in the financial suite.” This, said IDC, represents a granular level of focus on both customers and technology that will continue to help advance growth quickly.

IDC found that the value Acumatica was providing to its customers was reflected in its excellent revenue and growth numbers, including 144% net-new revenue growth while reaching the 4,000-customer mark in 2017. In addition, said IDC, Acumatica saw 90% year-over-year growth from its parent channel, indicating “building momentum and energy related to its solution.”

Exclusive Club

A report by Mint Jutras, a research and advisory firm that specializes in evaluating ERP solutions, found Acumatica to be an outstanding solution, citing four key elements that significantly differentiate Acumatica from its competitors:

  • The ability to access the solution from anywhere, on any device.
  • A flexible deployment model, allowing the customer to choose public cloud, private cloud or licensed on premise.
  • Modern consumption-based licensing meant to be affordable and inclusive of all designated employees as well as key customers and partners.
  • A connected cloud platform that aids in extending the solution without creating islands of automation.

As Mint Jutras noted, while there are vendors that can make a similar claim for one of these differentiators, “if we combine all four, Acumatica is indeed in a class all by itself.”

MaxQ + Acumatica = Unbeatable Value

Acumatica’s openness and flexibility have enabled MaxQ to create a framework on which we are able to extend the value of Acumatica and tailor solutions to specific industries and applications.

MaxQ solutions built on the Acumatica framework include Advanced Revenue Management, Advanced Billing, Inventory Management, and a Cannabis Management Solution that can handle the most demanding needs of large-scale cannabis manufacturers.

For all the reasons noted by the analysts and reviewers above, MaxQ’s many satisfied customers would agree that a MaxQ solution based on Acumatica offers outstanding value. To see what all the fuss is about, we invite you to see firsthand what a MaxQ Acumatica solution could do for your business.

MaxQ is a provider of advanced Acumatica business solutions across a wide range of applications and industriesContact us to learn more about how MaxQ for Acumatica solutions can help your business.

 


As Legalization Looms, Canadian Cannabis Players Make Moves

With recreational cannabis on the brink of becoming legal in Canada, major Canadian cannabis companies are making strategic moves to strengthen their positions.

While the Canadian market for recreational cannabis will be sizable, big Canadian cannabis producers like Aurora Cannabis, Canopy Growth Corp., Tilray, and Aphria are positioning to become leading suppliers of cannabis products worldwide.

Cannabis being illegal on the federal level has hampered the industry’s growth in the U.S., whereas Canadian cannabis ventures have benefited from the support of the Canadian government.

“Our government embraces us, and we are seeing a boom in entrepreneurism in this industry,” said Rob Anderson, the former CEO of The Green Organic Dutchman (TGOD).

The cannabis-friendly environment has led to Canada become an international cannabis hub and a hotbed of cannabis cultivation and investment. “Weed is to Canada what Silicon Valley is to the U.S. We will see a lot more money flowing in,” said Jason Spatafora, co-founder of Marijuanastocks.com.

The New York Times echoed this view, asserting that “a financial boom not seen since the dot-com mania of the late 1990s has overtaken Canada.”

TGOD Wheeling and Dealing

Among the Canadian cannabis ventures making waves, The Green Organic Dutchman (TGOD) has received kudos from analysts for “executing flawlessly.” An organic-only business strategy and series of shrewd deals has helped catapult TGOD to the top tier of cannabis ventures in a short span of time.

In June 2018, TGOD announced that it had created a new global division to focus on the beverage industry. To execute this plan, TGOD is building a 40,000-square-foot state-of-the-art research and development facility and a 287,245-square foot cultivation facility capable of producing 40,000 kilograms of premium organic cannabis for its beverages.

To create cannabis-infused beverages, TGOD entered into an exclusive agreement with Stillwater Brands to license its RIPPLE SC (Soluble Cannabinoids) and other food and beverage technologies. RIPPLE SC makes it easier to infuse CBD oils into beverages and edibles.

TGOD also acquired HemPoland, a leading European manufacturer and marketer of premium organic CBD oils. Technical 420 called this acquisition “a game changer,” noting that HemPoland provides TGOD with a European gateway with distribution channels to over 750 million people and sales in more than 700 locations across 13 countries.

Power Cost Gambit

In a previous post, we discussed the critical importance of minimizing cannabis production costs as cannabis prices continue to decline. TGOD has devised a clever strategy to minimize power costs, which is, as US News relates, a major cost factor in growing cannabis.

To reduce its power costs to a fraction of what its competitors pay, TGOD has entered into partnerships with provincial power suppliers. A partnership with Hamilton Utility Corp. has enabled TGOD to reduce its power cost from 13 cents per kilowatt hour to less than 5 cents at its Hamilton, Ontario, facility. A partnership with Eaton Corp. is enabling TGOD to obtain power at 75% less than its competitors. At its Quebec plant, TGOD is paying less than 4 cents per kilowatt hour.

All of these moves have enabled TGOD to position itself as a platform to launch cannabinoid-infused food and beverage products globally as new markets legalize. As equities.com notes, this puts TGOD in a prime spot as more large-scale beverage and alcohol companies enter the market.

Aurora Roars

Another Canadian player making big moves is Aurora Cannabis, which in January took a 17.6% stake in TGOD with an option to increase its share to 51%. Aurora made news earlier this year by acquiring MedRelief for $2.5 billion in what Reuters called “the biggest deal yet to unify major Canadian cannabis growers.” The MedRelief acquisition followed on the heels of Aurora’s acquisition of CanniMed for $890 million, which made Aurora “the biggest pot producer, by market value, in the world.”

Aurora also expanded its cannabis production capability with the opening of two new state-of-the-art cannabis production facilities–Aurora Sky, capable of producing 8,000 kilograms of cannabis per month, and Aurora Vie in Montreal, capable of producing 4,000 kilograms per year.

To optimize its customer experience, Aurora inked a deal with Shopify to revamp its e-commerce platform, a move that will help Aurora sell its cannabis wares globally as legalization continues to spread. Canopy Growth and Hydropothecary also have employed Shopify e-commerce platforms to sell to medical patients.

Acting Locally and Globally

As Technical 420 notes, while the Canadian recreational market is a big opportunity for the cannabis producers, the global market represents an even more significant opportunity. This is why the major Canadian cannabis producers are taking a two-pronged approach by establishing production plants and retail outlets within Canada while expanding their reach beyond Canada into worldwide markets.

In an August post, we described how Canadian cannabis producers and alcohol distributers were making deals to establish cannabis retail outlets for the recreational market. Cronos Group has taken a similar route by forging an agreement with MedMen to establish retail stores for the recreational market in Canada.

To beef up its retail presence, Canopy Growth Corp. acquired Hiku Brands, which sells a number of leading cannabis brands and operates retail outlets in provinces throughout Canada.  Canopy Growth also extended its footprint in South America beyond Brazil and Chile by forging a deal with Spectrum Cannabis Columbia.

Aphria also made a move to expand into Latin America and the Caribbean by acquiring Scythian Biosciences Corp.’s  Latin American and Caribbean assets. The deal gives Aphria exposure to more than 300 million people in Colombia, Argentina, and Jamaica.

Aurora Cannabis obtained a 51% stake in Aurora Nordic that will help extend its reach into Scandinavian and broader European markets. Aurora Nordic has a license to produce cannabis in Denmark, which Aurora said will give the company a major advantage as one of few companies with a license to cultivate in Europe. Aurora has forged a number of international deals, including agreements to supply medical cannabis to Germany, Italy, and Australia.

Getting Listed

This past February, Cronos Group became the first cannabis company to be listed on Nasdaq in the United States. In May, Canopy Growth became the first cannabis company to list on the New York Stock Exchange. At the same time, liquor giant Constellation Brands invested $4 billion in Canopy Growth.

Tilray became the third cannabis stock to be listed on a U.S. stock exchange when it joined Nasdaq in July. Tilray went even further by being the first pure-play marijuana company to go public on a major U.S. exchange. Tilray grows Cannabis in Canada and Portugal and distributes medical cannabis products in 10 countries, including Australia, Canada, and Germany.

If Tilray CEO Brendan Kennedy is correct, the cannabis companies focusing on creating cannabis-infused beverages are on the right path. Kennedy said he sees a future in which only 10% of cannabis will be smoked, with the 90% lion’s share being consumed as cannabis beverages. “Instead of alcohol, they’ll have cannabis,” said Kennedy. “And they’ll have a low, or no-calorie product with no hangover.”

As the maker of the most modern, integrated, and scalable cannabis manufacturing solution, MaxQ has deep cannabis industry expertise. Contact us to learn more about the latest trends and management solutions in the cannabis manufacturing industry. 


Cannabis Price Crash Puts Manufacturers in Peril

The price of legal cannabis has been dropping at a steady rate, and the outlook is for a continuing decline before the market levels off. Small cannabis manufacturers and dispensaries are being driven out of business, and large manufacturers that fail to take measures to minimize production costs are at risk of meeting the same fate.

As marijuanaventure.com warns, “When the market shakes out in five years and people stop selling at a loss, companies capable of producing high-quality cannabis at an industrial scale and with low production costs will be the only players left in the game.”

Revenues Up, Prices Down

Although cannabis revenues have been rising rapidly in states in which cannabis is legal, cannabis prices have been declining because of overproduction. In Colorado, for example, the Department of Revenue reported cannabis sales of $1.49 billion in 2017, an increase of almost 15% from the previous year and more than double the revenues reported in 2014. Over the same time period, however, cannabis prices in Colorado declined from around $200 an ounce in 2014 to less than $100 (including tax) in 2018.

The average wholesale price of cannabis per pound has declined from $2,000 per pound in 2015 to about $1,000 in 2018, with producers in some states having to sell for less than $500 per pound. One grower in Oregon was forced to sell his excess cannabis at a mere $100 per pound at auction.

The Guardian describes a bleak scene in Oregon in which overproduction has pushed consumer prices down to $6 an ounce.  Unable to remain profitable, mom-and-pop farms are selling out to out-of-state investors as the market becomes increasingly owned by a few big players. Many non-growing dispensaries also are losing money and selling out to large cannabis chains.

It appears that the cannabis industry is following the same consolidation path as the grocery industry in which small grocery stores were put out of business by big grocery chains.

Control Production Costs or Perish

As more and more large cannabis ventures enter the market and expand their businesses, only manufacturers that can keep production costs low will be able to survive.

As marijuanaventure.com warns, “by 2025, or maybe even as soon as 2020, this industry will be based around per-pound production costs in the $100 range, or potentially lower, and companies that can’t compete at that level will be swiftly left in the dust.”

As cannabis management consultant Rich Cardinal points out, the only way to create facilities capable of producing low-cost, high-quality cannabis is through the implementation of efficient growing methods and investments in advanced production models that employ state-of-the-art automation.

Accounting Practices Are Key

Critical to controlling costs in the manufacturing and distribution of cannabis are stringent and integrated accounting practices, coupled with the use of advanced analytics to track costs, perform forecasts, and maximize efficiency.

As cannabis accounting specialist Andrew Hunzicker observes, many cannabis companies find themselves plagued with financial struggles stemming from the complexity of cannabis accounting, including cost controls within the growth, manufacturing, and retail phases, as well as compliance and tax issues.

Besides establishing solid accounting practices and procedures, says Hunzicker, cannabis businesses must recognize the importance of deploying cannabis management software tailored to the needs of their industry.

The crucial need to control costs is why cannabis ventures like Liberty Health Sciences, Acreage Holdings, and Medmen are investing in facilities that incorporate the most modern, state-of-the-art growing and production methods, including manufacturing management software capable of streamlining and maximizing accounting operations.

As Hunzicker and other experts point out, these and other forward-looking operators are making the investments in systems that enable them to achieve the low production costs that will be required to survive into the future.

This is exactly what advanced management software like MaxQ Cannabis was designed to do—enable large-scale cannabis manufacturers to minimize production costs, streamline operations, and maximize profitability, including integrated and automated accounting with cost controls and compliance throughout all phases of cannabis growth, manufacturing, and distribution.

As the maker of the most modern, integrated, and scalable cannabis manufacturing solution, MaxQ has deep cannabis industry expertise. Contact us to learn more about the latest trends and management solutions in the cannabis manufacturing industry. 


Cannabis and Alcohol Industries Cozy Up Through Cash

As the saying goes, money talks—and the large amount of money being invested by alcohol and cannabis companies in joint ventures speaks volumes about the direction the cannabis industry is taking.

This trend was underscored by the recent announcement that liquor giant Constellation Brands was investing $4 billion in Canada’s Canopy Growth Corp. This massive cash infusion follows a $190 million investment by Constellation Brands in Canopy Growth Corp. in 2017.

Such a major investment by Constellation Brands is a solid vote of confidence in the cannabis industry, and no doubt is driven by the cannabis market’s expanding legalization and explosive growth worldwide.

We should expect to see the alcohol and cannabis industries become increasingly more integrated to create a large recreational cannabis and alcohol conglomerate.

Neutralizing the Cannabis Threat

As the legal cannabis market continues to expand, consumption of cannabis is taking a large bite out of alcoholic beverages sales. Studies show that alcohol consumption has declined by an average 15% in states in which cannabis has become legal.

As Money reported, recent studies show that U.S. consumers now spend as much on legal marijuana as they do on alcohol. In Aspen Colorado, cannabis sales surpassed those of alcohol in 2017, with licensed cannabis vendors taking in $11.3 million, topping the $10.5 million rung up by liquor sales.

To counter the threat to their revenues, major alcoholic beverage distributors like Constellation Brands are investing in cannabis ventures and developing cannabis beverages. At the same time, cannabis companies are investing in alcohol companies as a ready-made path to acquire retail outlets.

Beer Brands Field Cannabis Beverages

One way in which alcohol companies are combatting the cannabis threat, while at the same time capitalizing on the cannabis opportunity, is to produce non-alcoholic cannabis beverages. Beer maker Heineken introduced a non-alcoholic cannabis beverage called Hi-Fi Hops in California under its Lagunitas brand in July.

Molson Coors Canada, meanwhile, announced a joint venture with The Hydropothecary Corp., a leading Canadian producer of medical cannabis, to develop a line of non-alcoholic cannabis beverages.

Molson Coors is among the beer makers that have cited cannabis consumption as a risk factor to their business in 10-K filings with the U.S. Securities and Exchange Commission.

Blue Moon Brewing founder Keith Villa also has formed a new company called Ceria to produce THC-infused non-alcoholic craft beers. Villa has been working with cannabinoid research firm Ebbu to develop cannabis-infused beverages.

Province Brands in Toronto claims to have developed the first cannabis beer made exclusively using the marijuana plant, a beverage brewed without barley and using the stalks, roots, and stems of marijuana plants. Province also announced it was developing a new beer brewed from barley and infused with premium cannabis oil.

Liquor Stores Become Cannabis Outlets

With recreational cannabis becoming legal in Canada beginning October 17, Canadian cannabis producers are forging deals with alcohol distributors to acquire retail outlets. Aurora Cannabis in Alberta recently increased its previous $103.5 million investment in Alcanna, Canada’s largest liquor retailer, by another $34.5 million, upping its share of Alcanna from 19.9% to 25%, with an option to go to 40%. The agreement calls for Alcanna to open retail cannabis stores under the Aurora brand in provinces in which private retail is permitted.

Alcanna will build, own, and operate the new cannabis stores, which will carry a suite of brands from Licensed Producers, including Aurora’s MedReleaf and CanniMed products. According to Alcanna CEO James Burns, Alcanna will convert a number of its existing 230 liquor stores into cannabis retail outlets, as well as build new outlets, as it gains permission to operate cannabis outlets within Canadian provinces.

In a similar deal, Canadian cannabis producer Aphria signed an agreement with Great North Distributors, a Canadian subsidiary of Southern Glazer’s Wine & Spirits, to serve as the exclusive distributor for Aphria’s adult-use cannabis products throughout Canada. Aphria says the deal will give it 100% coverage of the cannabis retail market across Canada from the first day of legal adult-use marijuana sales.

Big Finance Enters Cannabis Fray

While Constellation Brands’ $4 billion investment in Canopy Growth is a huge event, of equal significance is the involvement of Goldman Sachs and Bank of America Merrill Lynch in the deal, Marijuana Business Daily reports.

As the report notes, the transaction appears to be the first mega cannabis investment to involve major U.S. financial institutions and is a move that represents a “transformational moment” for the cannabis industry.

“Wall Street can no longer ignore the pace, the amount of money being raised and the growth underway in this industry,” said Scott Greiper, vice president at Viridian Capital Advisors in New York.

A dark cloud hovering over the cannabis industry is the illegality of cannabis in the U.S. on the federal level, which is preventing financiers from investing in U.S. cannabis ventures. But there are signs of change, including bills introduced to legalize cannabis nationally.

Constellation Brands CEO Rob Sands told The Wall Street Journal that legalization of marijuana at a national level in the United States was “highly likely, given what’s happened at the state level.”

As the maker of the most modern, integrated, and scalable cannabis manufacturing solution, MaxQ has deep cannabis industry expertise. Contact us to learn more about the latest trends and management solutions in the cannabis manufacturing industry. 


Cannabis Miracle Drug Breaks Through Legal Barriers

In what is being hailed as a landmark decision and historic first, the Federal Drug Administration (FDA) has approved the first drug with an active ingredient derived naturally from the cannabis plant. The FDA approved the drug, called Epidiolex, because it was proven to be effective in treating patients aged two and older who suffer from some rare and severe forms of epilepsy.

Developed by GW Pharmaceuticals, Epidiolex is derived from cannabidiol (CBD), a component of marijuana that does not cause intoxication. The ruling is historic because it removes a longstanding stigma associated with marijuana and opens the door for other cannabis drugs to gain approval.

Cannabis Gaining Respect

Besides spurring further research, the approval of Epidiolex should engender a more relaxed and open-minded attitude towards cannabis drugs. We recently discussed the shifting attitudes towards cannabis by politicians and the general public as seen in the warm welcome being received by new cannabis manufacturing plants being built.

“This approval is historic in that it allows us, as a pharmaceutical company, to talk about this product in the way that pharmaceutical companies normally talk about their drugs,” said GW Pharma CEO Justin Gover.

Despite a wealth of evidence that cannabis has significant medical benefits, the U.S. Drug Enforcement Administration (DEA) still classifies cannabis as a Schedule 1 drug that has “no currently accepted medical use and a high potential for abuse.” Thus, Epidiolex must be approved not only by the FDA, but by the DEA as well before it can be legally dispensed.

GW Pharma CEO Justin Gover sees no problem in the DEA reclassifying cannabis, pointing out that because the FDA’s approval is a determination of an accepted medical use, the DEA must recognize this, and Epidiolex will not remain classified as a Schedule 1 drug.

Hurdles Remain

The recognition that untapped curative powers reside in the cannabis plant is a big step forward in the mainstreaming of cannabis. However, there are still a considerable number of legal hurdles and institutionalized anti-cannabis sentiment that cannabis researchers must deal with.

As researcher Jacci Bainbridge reveals, she and other cannabis researchers are frustrated by the requirements imposed on them, including extra paperwork, committees, planning, and inspections—hurdles, she says, that researchers studying heroin don’t even have to face.

Even as the pendulum swings towards the acceptance of cannabis, the debate about the risks and benefits of cannabis is still being waged. There also are politicians and pundits who continue to demonize cannabis. Although Canada’s Senate voted to legalize cannabis, the bill was passed “over the objections of Conservative senators who remained resolutely opposed,” the Montreal Gazette reported.

Opponents will have an increasingly uphill battle as the medical benefits of cannabis continue to mount. As The Week reported, “The evidence suggests cannabis is a relatively safe drug that provides a host of medical benefits.”

Drug Source Should Not Be an Impediment

As GW Pharma CEO Justin Gover observed, the focus should be on the effectiveness of a drug rather than its origins, pointing out that there are very few medicines prescribed because of their origin as opposed to what they can do for a patient.

Although the FDA’a approval of Epidiolex is a historic milestone, said Gover, when it comes to physicians prescribing the drug, it’s about the efficacy and safety profile. Besides the FDA’s approval of Epidiolex, physicians will recognize the importance of positive studies that were published in The New England Journal of Medicine and The Lancet, he noted.

What’s Next?

While cannabis has been found to provide relief for a good number of ailments, researchers have only scratched the surface in uncovering its potential uses. “It’s actually quite amazing how little we really know about something that has been used for thousands of years,” said Sachin Patel, a cannabis researcher at Vanderbilt University.

The FDA’s approval of Epidiolex has observers speculating as to what will be the next cannabis drug to win approval. GW Pharma says it is developing a number of potential new cannabis-derived drugs for epilepsy, glioblastoma, and schizophrenia.

Interestingly, Epidiolex is not the world’s first plant-derived cannabinoid prescription drug. That honor goes to another GW Pharma drug called Sativex, which has been approved for the treatment of spasticity due to multiple sclerosis in numerous countries outside the United States.

According to outsiderclub.com, a former GW Pharma medical director has left the company and is now chief medical officer at a new cannabis drug company that is developing a drug that kills cancer cells.

As the cannabis barriers continue to fall, it seems as if it will only be a matter of time the full spectrum of medical benefits are able to be discovered. As the Outsider Club reported:

“Marijuana is the real deal. It’s here to stay. Legalization timelines are being compressed and expedited. And it’s created hundreds of billions in new wealth.”

As the maker of the most modern, integrated, and scalable cannabis manufacturing solution, MaxQ has deep cannabis industry expertise. Contact us to learn more about the latest trends and management solutions in the cannabis manufacturing industry. 

 


New Feature in Advanced Billing: Generate Date Calculation

In the upcoming Release 18 of Advanced Billing for Acumatica, we added a requested feature for calculating a “generate date” based on the contract terms. If you have contract invoice terms of 30 days, meaning the bill is due 30 days after the invoice date, and you want to have the due date entered as the date of the generated invoice, the Advanced Billing system will calculate the date for you.

First, enter a contract and set the terms to 30 Days. Make sure “Back Off Generation Date by Term Date” is checked.

Next, Auto Generate Billing Schedule.

Contract schedules are created with the correctly calculated dates. Notice the beginning date of the contract and distribution period is still 8/1/2018, but the generation date has been recalculated to be 7/2/2018, so the due date of the invoice will be 8/1/2018.

MaxQ is a provider of advanced Acumatica business solutions across a wide range of applications and industries

Contact us to learn more about how MaxQ for Acumatica solutions can help your business.


A Big Shift in Attitude Is Positive for Cannabis Industry

The winds of change are blowing across the country as politicians and the public turn from hostility to a more accepting and welcoming attitude towards cannabis. The removal of political roadblocks is good news for cannabis manufacturers, as the market seems to have reached a tipping point with more and more states legalizing cannabis and the worldwide market expanding.

The expansion of cannabis manufacturing is continuing at a rapid pace throughout the United States. We’ve reported on new factories cropping up in Florida, Nevada, and California, and now another new plant is set to open in Cedar Rapids, Iowa, the second cannabis operation to open in that state.

Getting on the Cannabis Bandwagon

As the number of cannabis manufacturing plants increases, we are seeing a steady stream of stories about changes to state laws, new permits being issued to manufacturers, and comments from state officials and local populations about the positive impact the cannabis industry is having on their region.

This turnaround is significant because even medical cannabis has taken a hit from politicians who have conflated medical and recreational marijuana while demonizing cannabis to the public. The tone is changing as we hear positive statements from politicians like Cedar Rapids city manager Jeff Pomeranz, who had only praise for the new cannabis plant in his district.

“It’s twenty-one new jobs, manufacturing in Cedar Rapids, it will be good for the people of Iowa, and it makes sense for Iowa’s second-largest city to have a plant,” said Pomerantz.

The Cedar Rapids plant is being built by Iowa Relieve, a subsidiary of Acreage Holdings, one of the largest medical cannabis manufacturers, with cultivation, processing, and dispensary operations in 12 states. Like MedMen and other major cannabis manufacturers, Acreage Farms is expanding rapidly and has plans to set up operations in New York, Florida, and Maryland this year. The company also has plans to become a publicly traded company in Canada.

Citing the growing recognition of the benefits of medical cannabis, Acreage Farms observed that, “As cannabis becomes legal across the country, we’re witnessing a pivotal moment in medical research and treatment — the kind of shift that changes lives for millions.”

No Federal Crackdown  in Massachusetts

Another positive sign for the cannabis industry is U.S. Attorney Andrew Lelling issuing a statement that his office essentially will not interfere with the public consumption of recreational cannibis, which became legal in Massachusetts as of July 1. Lelling said his office would limit its enforcement activity to out-of-state sales, sales to minors, and organized crime.

As Jason Williams reported, this is big news and signals a huge win for the cannabis industry. “Even staunch opponents like Lelling are bending to the awesome might of this growing juggernaut,” said Wiliams.

Hope is seen on the federal level as well. As The New York Times reported, President Trump recently said he would likely support a bill introduced by Senators Cory Gardner and Elizabeth Warren to leave it up to individual states to legalize marijuana. This view is in “stark contrast” to the tough stance Trump and his administration have taken towards cannabis previously, said the report.

This new bill comes on the heels of a bill introduced by Senator Charles Schumer in April that would decriminalize cannabis on a federal level.

The cannabis industry has been operating under a cloud because of a conflict between federal and state laws. As Inc. reported, if these statutes pass, there could finally be a resolution to the “odd reality” in which selling a joint could land you in jail under federal law and give you a paycheck under state law.

As the maker of the most modern, integrated, and scalable cannabis manufacturing management solution, MaxQ has deep cannabis industry expertise. Contact us to learn more about the latest trends and business solutions in the cannabis manufacturing industry. 


Cannabis Market Goes Ballistic

We knew the cannabis market was hot, but the latest studies show the cannabis industry skyrocketing beyond analysts’ previous expectations. Surprised that legalization and demand are expanding the cannabis market at such an accelerated pace, analysts are scrambling to revise their projections upward.

“While it seems every year means a new monstrous projection about the size of the cannabis market, this year’s projection is especially large,” cannibisnow.com reports.

The latest “State of Legal Marijuana Markets” report by Arcview Group and BDS Analytics, which cannibisnow.com considers the “gold standard of marijuana industry data research,” shows the global legal cannabis industry tripling over the next five years, reaching $32 billion by 2022.

Cowen & Co. sees even bigger growth, raising its estimate of the legal cannabis market by a whopping $25 billion and projecting the cannabis industry will hit $75 billion in sales by 2030. Cowen says that its previous forecast of a total cannabis market of $50 billion by 2026 is no longer valid because “new forecasts suggest that the market is already that size.”

Grand View Research’s recent study sees the global medical marijuana market reaching a value of $55.8 billion by 2025. Over the past few years, the number of companies operating in the cannabis market has increased exponentially, the study says, and the market is expected to expand significantly because of legalization in several countries and the high demand for medical and recreational cannabis.

Legalization Drives Expansion

Even these bullish forecasts pale in comparison with that of European investment bank Bryan, Garnier & Co., which sees the legal global cannabis market poised for growth of more than 1,000% over the next decade, reaching $140 billion by 2027.

Legalization seems to be creating its own momentum, the report says, citing the legalization of cannabis worldwide as the driver behind a “rapidly expanding industry.”

Similarly, Market News Updates reports that the international cannabis industry “continues to blaze red hot” based on the findings of the Brightfield Group, which sees the market growing at a compound annual growth rate of 60% each year and reaching more than $30 billion by 2021. As with other market analysts, the Brightfield Group sees deregulation and increased consumer interest as the driving factors.

Surprising Global Growth

Arcview VP David Abernathy said the most surprising thing contributing to the cannabis market’s accelerated growth this year was the rise of international markets. Arcview analyst Tom Adams agreed, arguing that Germany’s move to make cannabis flower available for medical use in pharmacies was the big news of 2017 from a worldwide perspective. “The tables have turned in favor of legalization across the world,” said Adams.

Grand View Research sees Europe eclipsing North America as the largest market for legal cannabis by the end of its forecast period, with a 55.6% share in 2025. Arcview voiced a similar view, noting that Europe, which has 739 million people and more than $1.5 trillion in healthcare spending, has the potential to be the largest medical cannabis market in the world. South America and Australia also are seen as large burgeoning markets.

As money.cnn.com reports, the game is about to get a lot bigger as more and more North American territories join the legal cannabis market. In California alone, the opening of recreational dispensaries in January boosted the pool of legal marijuana users from 17 million to 47 million.

Analysts see the North American cannabis market accelerating further in 2018 as legal markets begin taking off in Canada, Massachusetts, Florida, and Nevada, with Maine, Vermont, Arkansas, Montana, North Dakota, West Virginia, and very likely New Jersey, Michigan, Oklahoma, and Arizona following suit.

Pot Tops Soda Pop

In sizing up the surging cannabis market, Bloomberg observes that sales of legal marijuana are projected to eclipse those of soda pop in 2030 based on Cowen & Co.’s projection that the U.S. legal cannabis industry will reach $75 billion in sales by 2030.

Comparing cannabis with other commodity markets, a case can be made for the cannabis market being larger than that of corn, cotton, wheat, and coffee based on UN data that valued the illegal cannabis market at more than $140 billion in 2003. The global market for coffee, which is one of the world’s most valuable commodities, is valued at about $100 billion per year.

Follow the Money

Another sign of the cannabis market’s surging value are the steeply climbing valuations of publicly traded cannabis companies like Canopy Growth Corporation, whose stock price has risen from $1 to $24, an increase of 2,081%, over the last two years. As Wealth Daily notes, marijuana is no longer an underground drug pedaled by criminals, rather “a viable industry that’s making investors an absolute fortune.”

As cannabis legalization becomes more widespread and cannabis production increases, the price of cannabis will continue to drop, which will continue to put pressure on manufacturers’ margins. Since 2015, the wholesale price of marijuana has fallen from around $2,100 per pound to $1,600 per pound.

For cannabis manufacturers, competition will intensify as investment dollars pour in and more producers enter the market, causing margins to shrink even further. Besides successful branding, manufacturers will look to gain competitive advantages by employing advanced cultivation technologies and cannabis management systems that streamline operations, control costs, and maximize efficiency.

As the maker of the most modern, integrated, and scalable cannabis manufacturing solution, MaxQ has deep cannabis industry expertise. Contact us to learn more about the latest trends and management solutions in the cannabis manufacturing industry. 


How Do the Different Revenue Recognition Methods in Acumatica Affect Revenue Recognition?

In this series, we answer real-life questions from Acumatica users

QUESTION: How do the different revenue recognition methods in Acumatica affect revenue recognition?

ANSWER:  Recognition methods determine how a deferred revenue or expense amount will be distributed over a defined number of periods. Within Acumatica, you can specify a particular recognition method in the settings of each deferral code on the Deferral Codes form, and can assign a deferral code to a line of an invoice or bill. Revenues can be deferred in a number of ways and over different time periods that you select. Besides choosing a recognition method, you must input the beginning and end dates.

Acumatica enables you to choose the revenue recognition method that best meets your needs. Following are examples of five recognition methods that can be selected within Acumatica ERP, including:

  • Evenly by Periods
  • Evenly by Periods, Prorate by Days
  • Evenly by Days in Period
  • Flexible by Periods, Prorate by Days
  • Flexible by Days in Period

The screen below shows an invoice generated in Acumatica for $7,500 of revenue that is recognized evenly over a five-quarter schedule:

Evenly by Periods

With the Evenly by Periods recognition method, the amount to be recognized is distributed evenly among all included periods. The number of recognition periods is defined by the value you specify in the Occurrences box for the deferral code on the Deferral Codes form.

The screen below shows how you set the Deferral Code for Quarterly Evenly by Periods over a three-period range:

The screen below shows the deferral schedule that is generated:

Evenly by Periods, Prorate by Days

With the Evenly by Periods, Prorate by Days method, the amount to be recognized is distributed evenly among recognition periods (the number of which is defined by the value specified in the Occurrences box on the Deferral Codes form). The first and last periods are counted together as one recognition period and the amount to be recognized for each is proportional to the number of days in each period.

The frequency of occurrences depends on the number of financial periods you select in the Every X Period(s) box. The installment amounts for the first and last periods are calculated based on a full-period amount that is proportional to the number of days each installment should cover.

The screen below shows how you set the Deferral Code for Quarterly Evenly by Periods, Prorate Days over a three-period range:

The screen below shows the deferral schedule that is generated:

Evenly by Days in Period

With the Evenly by Days in Period method, the amount to be recognized is distributed by periods with a proportional division by the number of calendar days in each period. The number of recognition periods is defined by the value specified in the Occurrences box in the deferral code settings on the Deferral Codes form. An occurrence is a recurring recognition event for which a recognition transaction is generated. The frequency of occurrences depends on the number of financial periods you select in the Every X Period(s) box.

The screen below shows how you set the Deferral Code for Quarterly Evenly by Days in Period over a three-period range:

  

The screen below shows the deferral schedule that is generated:

  

 Flexible by Periods, Prorate Days

With the Flexible by Periods, Prorate by Days method, the amount to be recognized is distributed evenly among periods, with a proportional division by days among the first and last periods. The first and the last periods may be less than a full period, depending on the start recognition date and the final recognition date specified in a particular document (such as AR invoice). The number of recognition periods is defined by the recognition dates specified in a document.

The screen below shows how you set the Deferral Code for Flexible by Periods, Prorate Days:

The screen below shows the deferral schedule that is generated:

Flexible by Days in Period

With the Flexible by Days in Period method, the amount to be recognized is distributed among periods, according to the number of calendar days in each particular period. The start date and the final date of the recognition process is specified individually for each line of a particular AR document (such as AR invoice or cash sale).

The screen below shows how you set the Deferral Code for Flexible by Days in Period:

The screen below shows the deferral schedule that is generated:

MaxQ is a provider of advanced Acumatica business solutions across a wide range of applications and industries

Contact us to learn more about how MaxQ for Acumatica solutions can help your business.

 


Innovation Pushes Cannabis Manufacturing to New Heights

Innovation within the cannabis industry is reaching new heights as more and more biotech and pharmaceutical companies enter the fray and the amount of cannabis research and development being conducted accelerates.

Cannabis R&D efforts are yielding creative new products and extraction techniques, as well as new methods of manufacturing aimed at making cannabis plant production easier, faster, and higher yielding.

Radical New Growth and Extraction Systems

Among the most noteworthy new manufacturing innovations are two systems developed by Iaso, called GrowBlox and PhytoX. These systems enable manufacturers to grow cannabis plants indoors at higher speed and without human assistance, and afterwards to extract the valuable ingredients from cannabis plants with greater efficiency and precision.

Traditional indoor growing methods require meticulous care and can take almost a full year to yield a successful crop. According to Iaso, GrowBlox can produce five cannabis harvests per year, which would make it the fastest marijuana propagation system on the market.

Along with GrowBlox, Iaso developed PhytoX as a way to optimize the cannabis extraction process for medical purposes. Touted by Iaso as the world’s first hydrodynamic extraction system, PhytoX freezes and pulverizes cannabis plants to maximize yields and increase potency, converting the entire plant into nano-emulsions that are then centrifuged and distilled.

Benefits of Wet Extraction

According to Iaso, PhytoX can perform extraction on wet or dry cannabis, making it capable of producing concentrate from freshly harvested plants. Extracting from wet cannabis plants retains ingredients that are lost in the dry extraction process. In addition, PhtoX’s use of water for extraction eliminates the needs for other solvents.

By speeding up and optimizing the cannabis growth and extraction process, GrowBlox and PhytoX have the potential to revolutionize the cannabis manufacturing industry. Iaso also produces cultures to optimize cannabis growth and is developing a new drug delivery system to be ready this year.

Better Drug Delivery Systems

A number of leading biotech firms are working to develop new ways to extract the active cannabis ingredients and deliver their medically beneficial effects in ingestible and topical forms. Lexaria Bioscience Corp. focuses its R&D on making cannabis medical compounds more absorbable and easily digestible. Lexaria’s process reduces the time of onset for edible cannabis to 15-20 minutes versus the usual 60-120 minutes, and increases absorption by five to 10 times, in addition to masking the bitter taste of cannabinoids without the need to add sugar.

Earth Science Tech, Inc. focuses its R&D on producing high-purity, high-quality cannabidiol (CBD) oil and infusing it in digestible products that provide medical benefits while not producing a psychoactive high. Earth Science Tech’s products include vitamins, minerals, herbs, botanicals, personal care products, homeopathies, and CBD oil delivered in capsules, tablets, soft gels, liquids, creams, sprays, and powders.

Cannabis Pain Relief Innovators

Several companies based in Colorado and California have established reputations for delivering high-quality cannabis products, including unique and effective methods of making cannabis ingestible for pain relief purposes.

Viola Extracts has become a leading producer of butane hash oil (BHO) products for the medical industry. Extracting the active ingredients of cannabis using butane produces pure and potent concentrates that are productized in a variety of forms and consistencies that include oil, shatter, wax, and live resins.

Another cannabis innovator is Foria, which has received a lot of media attention for its sensual cannabis products for women. For medical uses, Foria provides cannabis suppositories that offer relief from menstrual pain as well as back and hip discomfort. The suppositories provide rapid and long-lasting pain relief.

Colorado-based Binske infuses cannabis in a host of high-quality edible and topical products that can be used as an alternative to smoking. Its edibles include chocolate bars, fruit spreads, granola bars, olive oil, and tinctures of garlic, lemon, and chipotle. Its honey products are produced from local bees and can offer pain relief by being ingested in tea. Its topicals include bath salts, body lotion, and massage oils.

Another Colorado-based company providing quality medical cannabis products is Altitude Organic. Its line of edibles includes organic treats such as assorted fruit and brownie bars, as well as organic fruit gummy candies. It also sells an extra strength pain spray called Apothecanna.

All these standout ventures show how the legalization of cannabis, along with its many medical benefits, is causing an increasingly more diverse and sophisticated set of products to be developed, as well as inventive manufacturing techniques. Expect to see further innovation as more and more companies devote their attention to cannabis R&D and as legalized cannabis spreads to ever more states and territories.

As the maker of the most modern, integrated, and scalable cannabis manufacturing management solution, MaxQ has deep cannabis industry expertise. Contact us to learn more about the latest trends and business solutions in the cannabis manufacturing industry.