According to a report by Globe Newswire, the global cannabis industry was worth a staggering 20.8 billion in 2021 and is expected to attain a market worth of $197.75 billion by 2028, with a CAGR of 32.04% between 2022 and 2028. With the cannabis industry growing in leaps and bounds, investors worldwide are scrambling for a piece of the over $20 billion pie. Most of these investors have leveraged cutting-edge technologies to ensure long-term profitability and success in the cannabis industry.
So, what technologies have played a critical role in driving the cannabis industry forward?
Cannabis Biosynthesis
In the past pharmaceutical companies have used biosynthesis to produce a range of therapies, however with technology advancements scientists have recently begun to explore whether it can accelerate cannabinoid production. In 2019, University of California Berkeley researchers discovered how to genetically engineer ordinary brewer’s yeast to produce both tetrahydrocannabinol (THC) and cannabidiol (CBD), as well as some novel cannabinoids not found in the plant.
Cannabis biosynthesis involves creating complex compounds from simple substances used in living organisms. The two main chemical constituents (compounds) of cannabis are tetrahydrocannabinol (THC) and cannabidiol (CBD). THC is the psychoactive component, while CBD provides multiple health benefits when consumed. Both these substances belong to a class of compounds called cannabinoids. For years manufacturers have extracted cannabinoids from cannabis using traditional extraction methods like butane and propane extraction. While these methods get the job done, they’re highly inefficient, leading to excessive waste.
More recently, manufacturers have adopted cannabis biosynthesis to improve efficiency and reduce costs. Cannabis biosynthesis involves using different microorganisms (yeast strains) to produce the desired cannabinoids on a larger scale. This reduces production costs and the quality of cannabis products. The biosynthesis process results in creating molecules similar to naturally existing cannabinoids in the lab. These lab-made compounds evoke the same effect as natural cannabis molecules and are bioidentical to cannabinoids extracted from plants.
Personalized Cannabis Products
At one time, smoking “flower” (dried buds harvested directly from the plant) was the only known way for a consumer to get cannabis into their system. Thanks to technological advancements, there are now many more personalized ways to consume cannabis. The industry has seen a surge in the following:
- Extracts (oils, concentrates, etc.)
- Vape products
- Edibles (gummies, beverages, candies, baked goods, etc.)
- Topicals (lotions, creams, etc.)
- Oral products
- Transdermal products
- Inhalers
For large-scale production of these cannabis products, a perfect combination of THC and CBD is necessary. Anything higher or lower than the amount indicated, and manufacturers could face serious lawsuits, especially since THC is psychoactive. However, thanks to technology, manufacturers can ensure that the cannabis components in their products are deliberate, accurate and meet all regulatory and compliance requirements.
LED Lighting
LED lights are steadily phasing out high-pressure sodium (HPS) or metal-halide (MH) lighting in indoor cannabis growing facilities. They use less energy and last longer than HPS or MH bulbs. Most companies who grow marijuana plants indoors require high-intensity discharge (HID) lighting, specifically the HPS and MH bulbs, and in fact for many years, high-intensity discharge (HID) lights have dominated cannabis grow rooms. While they certainly get the job done, they’re not necessarily the best option. For a long time, growers felt as if LED technology had not caught up in terms of its ability to produce larger yields, but improvements to LEDs have led to growers reporting competitive results.
LED lighting isn’t a technological marvel, but it’s much more cost effective than HPS and MH lighting. For starters, HID lighting uses a lot more current than LED lighting. This increases long-term running costs. Furthermore, HID lighting requires more complicated lighting cycles than its counterpart, making the growing process very difficult. LED bulbs have thrown indoor growers a lifeline by providing efficient lighting for indoor cannabis plants, however, it’s worth noting that the upfront cost of LED bulbs is higher than that of HID bulbs.
According to Graham Farrar, President, and Chief Cannabis Officer of Glass House Brands, based in Santa Barbara, California “the cost is worth it”. He also noted that “LED lights are much more efficient in the conversion of energy to light”. Not only that, but LEDs emit less heat than HID lights, which means less energy to cool grow rooms. Farrar also points to LEDs’ longer life spans. HID lights typically need to be replaced frequently and are manufactured with toxic metals such as mercury. LEDs can last for years depending on usage. To Farrar, LED lights check all the boxes: “They use less resources, they’re good for the environment and for business”.
ERP Systems
A cannabis company like any other organization consists of multiple departments managing different aspects of the business from back-office accounting to manufacturing, distribution, and retailing. Although the cultivation and processing of the product is the primary focus of a cannabis company, a fully integrated Enterprise Resource Planning (ERP) solution manages all the other requirements to run a cannabis company of any significant size. An ERP system developed specifically for the cannabis industry will include functionality to support financial management including support for multi entity and intercompany accounting which many MSO’s find beneficial.
Many cannabis companies building out growing facilities require project accounting, typically provided as part of an ERP suite. Other ERP modules that cannabis companies are requiring are CRM, payroll, inventory management and warehouse management. Finally, if you are a cannabis company distributing to outside dispensaries you will inevitably require a solution to support order management. Particularly challenging for companies operating in the cannabis industry is multiple, strict regulatory guidelines for each government jurisdiction. Not only do ERP systems developed specifically for cannabis companies help streamline operations, but they also ensure compliance with state laws and regulations. ERP systems make it easy for cannabis businesses to track and manage their data, via real time reporting making them a crucial component in the industry’s technology landscape.
Technology for a Thriving Cannabis Industry
Technology has played a major role in shaping the cannabis industry. From personalized products to efficient lighting and streamlined operations, technological advancements have revolutionized how manufacturers sell and produce marijuana. Contact us today for professional and practical ERP solutions for your cannabis business to stay ahead of the competition.
