365 Cannabis, Now a Part of Innovia Consulting
Ask a cannabis operator what it costs to produce one jar of flower, and you'll usually get one of three answers.
Some provide a number immediately. Dig a little deeper, and that number turns out to be a target, last year's average, or a figure calculated in a spreadsheet that hasn't been updated in months.
Some provide a range. A wide one.
And some simply admit they don't know.
That doesn't mean they're running a poor operation. Many operators can tell you their yield per light, track every strain in every room, and maintain tight control over cultivation and production. Yet they still struggle to answer a basic costing question because the information needed to calculate it isn't readily available.
This isn't a record-keeping problem. It's a systems problem, and it's common throughout the cannabis industry.
Most cannabis operators run their operations in one system and their financials in another.
The operational side is often managed in a cannabis-specific platform built for compliance, cultivation, manufacturing, and inventory management. The accounting side lives in QuickBooks, Sage, or another ERP system.
Between those systems is usually a manual process.
Every month, someone exports data, reorganizes it in spreadsheets, creates import files, and loads journal entries. If everything goes according to plan, the numbers balance. But as data moves from one system to another, important details are often lost.
The operational system may know a specific crew spent six hours working in a specific room. The accounting system records a monthly labor expense.
The operational system may know exactly which nutrient lot was used in a batch. The accounting system records an expense total.
The operational details required to understand product costs become increasingly difficult to trace as information is summarized and transferred between systems.
The issue isn't that the data was never tracked. It's that it was tracked in one place, valued in another, and never fully connected. The Cost of Not Knowing
There isn't a line on your income statement called "cost of not knowing," but the impact shows up in plenty of other places.
It appears:
Those costs are real, even if they don't appear as a separate line item in your financial statements.
To help operators understand where they stand, we built a simple assessment consisting of twenty-two questions.
There are no pricing calculations, software demonstrations, or product comparisons. The goal is simply to evaluate how easily important business information can be accessed.
Each question asks a variation of the same thing:
Could you produce this number today without having to reconstruct it?
The assessment covers metrics such as:
Most operators find there are more gaps than they expected.
Not because they're careless, but because many of these figures exist somewhere between operational systems and accounting systems. They're tracked, but they aren't always easy to access, validate, or report on.
The final score isn't the most important outcome. The real value comes from identifying the questions that are difficult to answer today and understanding how those gaps affect business decisions.
The cannabis industry does have unique requirements, particularly around compliance and regulatory reporting.
But when you look beyond compliance, many cannabis operations face the same challenges as other process manufacturers.
Extraction involves multi-level bills of materials, co-products, by-products, variable yields, and lot traceability.
Cultivation requires production planning against long growing cycles.
Packaging is assembly work.
Distribution is still distribution.
These are challenges that industries such as food production, brewing, dairy, and specialty manufacturing have been managing for decades.
The solutions are also familiar:
Understanding this matters because it changes how businesses approach technology decisions.
When cannabis is treated as completely unique, organizations often end up with tools that handle compliance extremely well but provide limited capabilities for costing, manufacturing, and financial management.
Years later, operators still find themselves asking the same question:
What does a jar actually cost?
The goal isn't to reinvent how a cannabis business operates. It's to combine industryspecific compliance requirements with proven manufacturing and financial management practices.
It's worth being clear about what software can and cannot do.
We're not going to claim an ERP system will automatically reduce your days sales outstanding. Payment cycles are influenced by factors far beyond software.
We're not going to assign a specific ROI value to better reporting. Better information helps organizations make better decisions, but the value of those decisions is difficult to quantify honestly.
And we're not going to say a system improves cultivation yields.
What a system can do is provide visibility into what happened, where variations occurred, and how those results compare to expectations.
Improving performance remains the responsibility of the business.
What the right system delivers is a complete, accurate, and defensible record of operational and financial activity without relying on disconnected spreadsheets and manual workarounds.
That foundation is what makes meaningful analysis and decision-making possible.
If you'd like the assessment, we'll send it. There's nothing in it that requires talking to us, and the answers stay yours.
If you score high, you already have strong visibility into your operation. Whatever decisions come next, you'll be making them with reliable information. That's a good position to be in, and it's less common than it should be.
If you score low, you're in the same place as many operators across the industry. The next step isn't necessarily buying new software or changing processes overnight. It's taking a closer look at the questions you couldn't answer and understanding why.
In many cases, the information exists somewhere in the business. It's just difficult to access, difficult to connect, or difficult to trust.
And that's often where the real opportunity starts.
Oversupply in the cannabis industry has fueled the infamous “race to the bottom,” pushing prices lower and squeezing margins for operators nationwide. Too many cannabis businesses focus on sheer output and overlook a key business practice: selling through inventory at a healthy margin.
Because cannabis is a regulated product with strict expiration dates, operators must not only produce efficiently but also turn product quickly. The reality is that many overproduce which forces them to slash prices just to get product onto shelves. This cycle of oversupply and discounting has accelerated falling wholesale prices across the U.S. According to Cannabis Benchmarks, the weighted average price for a pound of cannabis dropped from $1,328 in August 2019 to just $1,093 in August 2025—a 17.7% decrease—while inflation rose by 26.36% in the same period.
With rising costs of living and operating facing off with a race to the bottom, cannabis operators need smarter strategies to protect margins and stay competitive.
Spoilers: we got your back on this but keep reading.
A major factor in the race to the bottom is discounting product pricing. Common reasons for discounting products are upcoming expiration dates and having too much product on hand and needing to make space. A solution that we have seen success with is Available to Purchase (ATP) in cannabis software.
ATP is a live tool in cannabis inventory management software that delivers data to operators on how much cannabis can be legally and operationally committed to a sale. Basic inventory counts will only show how much finished product is ready to sell at that moment- just what's on hand. An APT program is a comprehensive look at what you have on hand, what you have allocated to customer orders, what’s quarantined, what’s in the production cycle, and what’s pending testing. Where basic inventory reports give a surface-level snapshot, ATP provides a comprehensive, real-time picture of what’s actually sellable.
ATP capabilities for cannabis management extend past sales availability; it can also be a compliance safeguard. The accurate numbers inclusive of products in testing or to be finished soon deliver accurate inventory across the board. This ensures alignment with the state compliance system and avoids unnecessary compliance penalties. Many ATP solutions also offer FIFO capabilities to ensure, true to form, product is sold on a first in, first out basis.
ATP also prevents accidental oversell situations that may be costly and labor inducive to fix. Aside from oversells, there may be fees or penalties within state compliance systems for inaccurate product numbers. The ATP tool becomes a single source of truth for cannabis sales commitments and streamlines operations for your sales team.
When paired with a cannabis ERP system that includes sales projection reporting, ATP gives operators the insights they need to forecast demand, control output, and maintain profitability.
The fastest way to bring ATP into your cannabis operation is by using a cannabis ERP system designed for compliance and inventory management. With 365 Cannabis, ATP is powered by SellStack and can be built directly into cultivation, manufacturing, distribution, and retail workflows. That means operators can see, in real time, exactly what inventory is legally and operationally available to sell, without worrying about overselling, compliance discrepancies, or wasted product.
By combining ATP with 365 Cannabis’ sales forecasting, costing, and compliance integrations, operators can finally take control of their inventory, protect profit margins, and stay competitive, even in an oversupplied market.
To see the solution in action, schedule a demo with 365 Cannabis and discover how ATP can give your business the confidence to promise only what you can deliver.
[vc_row][vc_column][vc_column_text]At any given time, there is a Delta9 Systems team member in California, Washington, Ohio, Michigan, and North Carolina. We travel a lot to be with our clients and customers. The cannabis business environment across the nation is dynamic, so it’s vital that we be out visiting with our customers where they are doing business. Each state is its own little microcosm of the cannabis industry, with its own unique blend of MMJ, Rec and Hemp laws. The micro-market in each state means there are unique challenges and advantages, and we need to be familiar with each one in order to serve our customers effectively.
Regardless of the market there is one constant all operators must contend with. All state governments require the cannabis producers and processors in the supply chain to keep real-time information about five main metrics: plant counts and stages, current inventory, the actions and conversions performed on that inventory, any transportation from one license to another, and records of any and all sales. When these records from cultivators are combined with the sales data from retailers, this data set is called the Seed-To-Sale record. This is the chain of custody record that will be used by regulators to ensure no diversion is taking place into the black market, tax revenue is collected, and that a recall is possible should there be any problems with contamination in the supply chain.
Some states demand up to the minute reporting, others ask for a monthly accounting. These reports are required to maintain compliance and keep the license operating in good standing.
In most states the regulating body in charge of cannabis will contract with a software service provider such as METRC, BioTrack or Leaf to handle industry data and present it in an actionable way for regulators. This reporting service is free for use by Producers and Processors, and each licensee is given a log-in to the system that is associated with their cannabis license. Reporting requirements are similar to DOR or DOL reporting obligations. While these 5 metrics are crucial, these numbers are what regulators need to track to not run afoul of federal guidelines. Cannabis entrepreneurs need to collect this data and much more to be successful…
This is where a Third-Party Integrator (TPI) is crucial. The Third-Party Integrator allows Producers and Processors to record and report the 5 mandatory data points to the state, while simultaneously capturing the incredible amount of intricate data generated by modern gardens and labs. As cultivators move through the compliance workflow, data about COGs, consumable depletion and inventory, scheduling, personnel, HR, and production processes can be collected and referenced while maintaining a compliant cannabis business.
We see the benefits becoming more apparent as time goes by in the shops that use TPI’s. The biggest benefit we see that TPI gives its users is the ability to get very specific with production scheduling and communicate that schedule efficiently. Scheduling becomes more and more important the larger an operation becomes. The gardens that always have plants ready for Mothers, Clones and Veg will always be flowering and more importantly, harvesting. Being able to use that schedule in conjunction with SOP’s means employees come to work with a list of tasks waiting on their daily dashboard. They can then mark each task, pulled from SOP’s and auto assigned to each employee, as complete and sign off on to make sure the job is done, accountability is established, and compliance is maintained.
Measuring productivity, and eliminating inefficiencies using the historical record generated by these Enterprise Resource Planning tools, or ERP, has a cumulative effect over time. Delta9 Systems consults with many different customers, some who use TPI/ERP, and some who don’t. As the Industry gets more mature, we are seeing huge structural advantages in the businesses who are implementing TPI. The seemingly tiny savings add up and have an exponential effect. Having data to make decisions saves time and resources, which translates to money. Using historical sales data allows a better planning for each round. We expect to see these advantages increase exponentially as margins continue to shrink and competition becomes fiercer.
365 Cannabis is working with the team at Delta9 Systems to verify hardware that is plug and play. Based on the Microsoft Dynamics 365 Business Central platform, this system delivers the robust workflow support that cannabis pros need. The cultivation tracking is very simple, but the processing workflow tracks COG extremely well through each operation, and the sales tools are hard to beat. It integrates seamlessly with other Microsoft productivity programs you might already be using so the training and ramp up is simple. The scheduling tools give cultivators a great way to plan for orders months in advance, and create plants based on pre-orders. Most importantly, because it is windows based, you won’t have problems with drivers or software compatibility. Schedule a demo today!
This article was provided by Delta9 Systems[/vc_column_text][/vc_column][/vc_row]
