We’ve all heard the age-old idiom, “A bad workman blames his tools.” But when it comes to working in a highly nuanced industry such as cannabis, the tools required to successfully run an airtight operation are crucial. To run a lean cannabis cultivation and processing operation, it is imperative to have a software solution that not only supports state-by-state compliance requirements, but also provides financial reporting insight.
Like any business, the primary goal is to increase profits. The best way to do this is by implementing a solution that can link data across the key areas of business i.e., finance, accounting, sales, purchasing, and inventory. Fortunately, Dynamics 365 Business Central provides that capability. In this case, it’s apt to say, “A person is only as good as their tools.”
The financial security that can come from Dynamics 365 Business Central is unmatched and better yet it’s a low-cost ownership solution. Utilizing a cloud-based ERP like Business Central means that there’s minimal infrastructure investment and its model is subscription-based, so there’s no massive upfront payment. While at its core, it’s a straight-out-of-the-box solution, cannabis manufacturers tend to benefit greatly from a partnership with an ERP provider that will extend the solution to fit a company’s specific operations. We will discuss this in more detail later.
Why Dynamics 365 Business Central?
No one wants the mammoth task of manually managing multiple spreadsheets and pivot tables, or the job of trying to decipher the data to determine what’s actually going on with the business. Spreadsheets are fragile and they do not provide an audit trail. Plus, relying solely on a spreadsheet system is inefficient as it leaves organizations open to a ton of error; when each person has their own set of data, there’s not a single source of truth. The lack of data integrity also makes a company vulnerable, curtails its ability to grow and effectively scale operations. It’s important to note that, just because your business has always done things a specific way, does not mean it’s the right way.
Still not convinced? Maybe, it will help if you take a closer look at the key benefits of Dynamics 365 Business Central.
Increase Profits with Dynamics 365 Business Central
Below is a list of the main benefits Business Central offers that can help a cannabis manufacturer that is keen on increasing its profits:
- Understand cash flow and financial state of the business: Providing integrated real-time financial reports and Business Intelligence (BI) tools to further drill down inquiries. Maybe you’re interested in adding a new product to your line or bringing on a new sales resource to expand your reach, with knowledge of your immediate and extended cash flow, you’re able to make better business decisions that align with your goals.
- Timely payables and receivables process: With an integrated solution, there’s no duplicate entry of transactions from spreadsheets to Business Central. Workflows can be deployed throughout the system, including for collections and automated payables. These workflows eliminate manual processes and increase efficiencies. For cannabis companies, the tax management portion is important as it has the ability to calculate cultivation and excise tax, as well as the cost of producing finished products.
- Streamline approval workflows: Considering approvals for purchasing based on user, dollar amount etc., credit approvals, new data, such as customers, items and so forth. The user also has the ability to approve from a mobile phone with a “Team” license, which is cost effective. With these automated workflows, your leaders can have an efficient way to manage important tasks without causing a bottleneck within your processes.
- Intelligent budgeting and forecasting: Allow the user to undergo a “What If” analysis via Microsoft Power BI or other Business Intelligence (BI) tools available. BI is an “interactive process” — the user is not just printing a report but instead querying the data. With predictive sales forecasting, you’re able to anticipate and project future sales and demand so you can tailor your production to the inventory that you’ll need to fulfill orders. By understanding your inventory levels, you’re not spending unnecessary dollars on inventory that will live on your shelves for extended periods. You’re also not spending money to rush-produce to meet demand.
- Inventory Valuation: Determines the cost that is assigned to an inventory item using the following equation – Ending inventory (Equals) = beginning inventory (plus) + net purchases (minus) – cost of goods sold. The Inventory Valuation report always details actual amounts, as in, the cost of entries that have been posted as invoiced. Accurate inventory valuation is critical to accurately calculating both profit and potential tax liability. Attempting to manually calculate this data and keep it up to date is near impossible. Business Central gives you a clear understanding of your inventory valuation at any given time.
Implementing the right ERP platform can help your cannabis company improve visibility, which is paramount for forecasting, communications, and a myriad of other aspects to manage the everchanging requirements of your business. With Velosio’s SilverLeaf cannabis ERP solution, complete tracking from seed-to-sale has never been easier. SilverLeaf utilizes Microsoft’s best-in-class ERP, Dynamics 365 Business Central with all the integrated functions a cannabis company could ever need. It comes prebaked with quality control, cultivation, and regulatory compliance, while offering the financial strategy component to make your business a success.
Make plans to join our upcoming webinar series where we explore how technology can help businesses like yours outpace the competition and increase your bottom line.
Mastering Cannabis Operations: Five Steps to Financial Success
Wednesday, July 27
2 -3 ET
Maintaining a financially healthy business and understanding your cash flow, revenue forecast, and AR/AP implications is vital to the success of your operation. Cannabis producers have specific requirements and KPIs that indicate the success or looming failure of the business. Join industry and technology experts as we discuss the five steps to financial success for cannabis producers including cash flow metrics, streamlined processes, intelligent forecasting, and much more.
Register for this webinar and other three in the series, here.