Cannabis regulatory requirements place much time-consuming, expensive, and error-prone mandates on supply chain operations, so we seeked guidance from a person with deep experience and lives in the thick of it. Dominic Respicio, Senior Supply Chain Manager, Harborside, is a 30+ years supply chain veteran of which the past 5 years have been in the cannabis industry. We had the privilege to discuss challenges, and maybe even more importantly, solutions that create cost and time savings as well as eliminate manual entry errors to drive efficiency in cannabis seed to sale operations.

From a supply chain management perspective, operators need to have tight control and tracking of seed to sale movement and record keeping in order to remain compliant with applicable state regulations. 

A key motivator for Dominic and many in cannabis supply chain management is to ensure that they know the location of all our cannabis cultivation plants, batches, and product units all the way through to sale. Each unit needs to be accounted for to avoid tainted or elicit black market products from making its way onto the shelf.

The tracking is most often done by manual creation of regulatory labels. While the creation of these labels is mandatory, the manual process is extremely time consuming, costly, and introduces entry errors. “We need to create a more automated way of doing this. Right now, everything is manual entry,” says Respicio. “Everything being manually entered, there is a significant amount of inherent keying in errors. We look at a higher degree of automation that allows us for less keystrokes and more productivity. Right now our industry is spending a significant amount of time on duplication and manual processes to support this duplication, and it is something that we need to get away from. In lean operations management, automation is probably the most significant aspect of what we need to accomplish in our day to day operations – that is the most important thing to accomplish.”

Automation also means a higher degree of quality. Dominic emphasizes, “The most significant aspect of an automated environment is quality. The aspect that you are removing manual processes; the aspect that you are taking out the human factor and the aspect of human related errors – that is very important.”

The primary challenge in regulatory tracking requirements centers around movement of cannabis and having a record of that. In each of these transfers of product, a regulatory UID (unique identifier) must be created and recorded. Not only is automation imperative, but cannabis brands want to avoid over-stickering their product with a bunch of regulatory labels. “So what they are doing today is labeling and that is something we don’t have to do and avoiding that creates tremendous industry savings. This is something for the entire industry,” states Respicio. 

In order to avoid all this unnecessary labeling, Harborside will be implementing a solution provided by Lucid Green. Instead of using physical stickers for the movement of the product, Harborside will be digitally recording and saving METRC IDs under one physical sticker called a LucidID, that gets applied to each cannabis package at inception. Every step of the movement of cannabis requires a unique ID creation that is digitally appended to the LucidID for complete record keeping and adherence to regulatory requirements. “Our industry, right now, is highly dependent on manual, paper-based administration – we need to get away from that,” says Dominic.

The impact of this implementation is dramatic as it relates to cannabis supply chain efficiencies, cost and time savings, and the elimination of manual entry errors. Dominic highlights that “Being able to do the pre-labeling and flow-ready ticketing yields the following results:

  • Elimination of defective data entry.
  • The ability to use technology that drives a lean supply chain infrastructure that reduces labor costs.
  • Reduction of headcount, or at least divert FTE to other functional areas.
  • Based on the freight volumes we are seeing here at Harborside, this is a savings of 1 to 2 FTEs at our brand/manufacturing level.
  • At the distribution level, it is 1 or 2 full time positions based on the workload. Obviously, the bigger the distribution operations, the greater the savings.
  • At the retail level we are looking at 1 full time person in terms of prepping products for the sales floor.
  • At the farm level for grow operations, it can be anywhere from 1 to 2 FTEs based upon various regulations at the state, county, and municipal levels. 
  • Harborside is also strengthening our capabilities for floor readiness and being able to get product directly from the receiving area to the floor.” 

The implementation of LucidIDs plays a key role for Harborside. “I have been familiar with the LucidID and it’s potential to impact the industry for well over 2 years now,” says Dominic. “The LucidID solution provides a significant advantage in every aspect of a lean supply chain. The key aspect that LucidID technology brings, is being able to see that transparency inseed-to-sale. The ability to enable a floor-ready QR code solution brings about tremendous opportunities, not just for in time distribution and inventory control. Being able to automate and use LucidID technologies for greater levels of automation is key. I believe that whatever processes we get in place at Harborside via the LucidID, will be adopted as best management practices (BMP’s) as now Harborside’s ‘activism’ within the cannabis industry is in contrast to the previous ‘activism’ in the Safe Access days of prop 215. I would assume that people and other companies are going to imitate this best management practice or standard. Our goal is to create a process that is an industry standard. I believe that the LucidID is the foundation for creating a standardization and best practices in that regard. Based on this LucidID solution, we can actually leapfrog traditional consumer packaged goods – the way they do things today.”

Dominic is committed to the cannabis industry as a whole and truly believes we are a community that needs to work together. “My motivation for coming into the cannabis space is to bring about best practices … establishing best practices in this fledgling industry.” He looks to challenge the industry and says we need to “recognize we are too young of an industry to be entrenched in the way we look at solutions and the way we do things. I believe the California cannabis industry has responsibility not just to the California cannabis industry, but to the cannabis industry as a whole. If we can get best practices in California and have a relevant effective model for the rest of the country to follow … and get that ready for when federalization becomes a reality, it is something that we in cannabis supply chain management absolutely need to take responsibility for.”