The ROI of RFID: How Cannabis Businesses Can See a Positive Return on Investment
Published by
TMCC Admin Team
12 months ago
Tracking, tagging, transponders, and electromagnetic fields, oh my! Do you know how cannabis products are traced and tracked across the supply chain? In this episode of the Cannabis Community Insider, we deeply dive into the overlooked world of Radio Frequency Identification technology, otherwise known as RFID, to learn about how this technology is commonly used in dispensaries, cultivation, and processing centers around the world.
Today’s channel discussion features three experts in RFID technology and its application in the cannabis industry.
The first expert is Duane Roebuck, a recognized expert in technology within the cannabis and retail industry. He works with thousands of reseller businesses in North America to provide them with the latest hardware products and innovations.
BlueStar partners with enterprise-level hardware and software solutions and seed-to-sale providers to maintain track and trace compliance.
In his role, Duane strategically connects manufacturers such as Deeper Technology, Ewo Star Micronics, LG, Hickvision, and others to cannabis software providers to assist in the development and demo equipment and channel strategies.
Eric Malmez is a member of the Zebra Technologies product management team with subject matter expertise in RFID technology.
He has been responsible for Zebra’s fixed RFID readers, sled, integrated RFID handhelds, and incentives.
He has been instrumental in successfully developing and launching Zebra’s RFID data capture solutions and has helped oversee the continuous modernization of the RFID DCS product portfolio.
Scott Denholm is the Chief Operating Officer of BrightMap, a cannabis seed-to-sale company that focuses on providing immense benefits to their partners using proprietary RFID technology.
In a way that dramatically reduces labor costs and human error, as a seasoned expert in the world of RFID, Scott brings unparalleled experience to the conversation.
Radio Frequency Identification (RFID) technology is not new. It was invented in 1945 as an espionage device by Leon Theremin.
Nowadays, RFID tech is utilized to prevent theft or identify products.
In the cannabis industry, RFID tags are utilized by the Marijuana Enforcement Division to track and monitor cannabis growth, transportation, and sales.
RFID helps the cannabis industry save time and money by leveraging the data collected to track inventory and support timely business decisions.
It is possible for cannabis growers and manufacturers to maintain regulatory compliance, reduce labor costs, improve accuracy and inventory reporting, and improve customer service from end to end.
RFID provides a more intelligent method of capturing data by using low-power radio frequency technology.
An RFID system can read the information on a tag without requiring line of sight, without a particular orientation or from short read distances.
Tags can be read from a distance without touching or disturbing a plant. They can read multiple tags simultaneously, increasing speeds 10 to 15 times faster than barcodes.
Tags are durable against impact and environmental factors like soil. You can locate tags making it easier and quicker to find misplaced items.
You improve and simplify reporting and compliance processes.
For the cannabis industry, RFID offers a unique ability to track and trace an item’s current location and movement, in this case, plant buds or infused products.
It improves tracking movement, compliance, and expense management.
Each plant is assigned a unique ID that follows it all the way to harvest.
It tracks plant location movements, dates, harvest aids, strain type, and strain mother.
Custom area designation allows room and plant creation; you always know where your plants are at any moment.
The rooms in a grow facility were carefully designed with purpose and reason, so you must use that same chair when setting up your management system.
As your plants mature through the stages of life, they move from various care areas, and you get to keep track of every movement from seedling to cured fat flower.
A class-leading system like this will include integrations with all regulatory committees and government agencies to ensure that all transactions occurring are compliant and tracked accordingly.
From nutrients to labor, there are many costs associated with growing cannabis. When you track all of these costs associated with the plant as it journeys from seed to flower, you can track this and actually lower your cost.
In addition to that, all accounting works into RFID.
For the cannabis industry, the software platform will also automatically send compliance data directly to the state agency.
RFID is sophisticated, modern, and it’s going to save your business time and money.
Your best bet goal is to obviously find an integration partner for initial analysis setup and ongoing.
The cannabis industry deals with inventory and employees like any other aspect of retail, so it is important to use technology like RFID for auto data capture capability.
RFID helps to eliminate errors that may arise when people interact with products, and it allows businesses to put people where they are good at dealing with other people.
RFID can be used to track inventory and make businesses more operationally efficient.
RFID can be costly, so it may not be feasible for smaller businesses.
RFID can also enhance the customer experience, not just track inventory.
For example, RFID-enabled shelves can provide an interactive experience for customers when they pull products off the shelf.
This experience can include more information about the product, such as where it was grown and the entire process behind it.
Applying RFID in Different Cannabis License Categories 16:04
Different cannabis license categories, such as dispensaries, craft growers, infusion, and transport, may require different approaches when it comes to RFID.
For example, dispensaries may benefit from RFID to enhance the customer experience, while transport businesses may need it for logistics and inventory management.
RFID can be expensive, and smaller businesses may not find it feasible, while larger businesses may benefit from it in the long run.
It is important to think about longer-term goals and make the proper investment the first time, especially if a business is planning on expanding to multiple locations in the future.
How Cannabis Businesses Can Optimize Their Operations
RFID is an important technology that can help cannabis businesses with inventory management and enhancing the customer experience.
However, it can be costly, and smaller businesses may not find it feasible, while larger businesses may benefit from it in the long run.
It is important to think about the specific needs of different cannabis license categories and make the proper investment for the long term.
The Fundamentals of Keeping Your Business Open 20:48
As a business owner in the cannabis industry, being licensed, open, and having products to sell is fundamental.
Meeting the first two criteria, namely being licensed and open, is critical to having a business to run.
The cannabis industry has varying license fees from state to state, ranging from $2,500 to over $50,000, and protecting that license is crucial.
Regulatory agencies require businesses to know where their products are at all times and be able to prove it.
Technology like RFID can help control what businesses are shipping and receiving and ensure delivery accuracy.
The speaker emphasizes the importance of understanding what you’re looking for before calling someone like him or anyone in the RFID world.
Before calling, he suggests looking at your processes and finding out where your mistakes are happening and where your cost centers are.
Once you have an excellent functional understanding of these things, then you can call someone in the RFID world to have real conversations about how they can save you money and what to do to put a return on investment.
The speaker suggests linking up with him on LinkedIn or Leaf Wire to converse about RFID.
There aren’t any stupid questions, and he believes that iron sharpens iron, so it’s essential to have conversations to understand the technology and its benefits.
He can’t sell you anything, so don’t feel pressured to do anything other than educate yourself and make the right decision.
The speaker suggests investing in something that can grow as your business grows instead of buying something cheap with no support.
ISO (International Organization for Standardization) has established a functional specification for RFID technology.
UHF RFID (Ultra-high-frequency radio-frequency identification) is also called EPC (Electronic Product Code) and Gen 1 class 2.
It is essential to do research before using RFID technology to understand its functionality, which includes UHF, HF (High-frequency), microwave, passive, and active technology.
Seed to sale is a term used to describe the complete life cycle of cannabis from the moment it is planted until it is sold to the customer.
Seed to sale involves traceability, compliance, and inventory tracking.
The concept of seed-to-sale can vary depending on who is talking about it, with retailers, growers, and other stakeholders having different perspectives on what it means.
Importance of RFID technology in seed to sale 36:14
Using RFID technology in seed to sale can provide customers with transparency and visibility into the product they are purchasing.
From the perspective of growers and dispensaries, RFID technology can help with compliance and inventory tracking.
RFID technology can provide insights into the growing process and ensure that customers receive quality products.
Using RFID Technology for compliance and inventory tracking
The seed to sale concept can be complex and can vary depending on the stakeholder’s perspective.
The use of RFID technology can help with compliance, inventory tracking, and provide transparency to customers.
Several resources are available for understanding RFID technology, including ISO, GS1, and RFID Journal Live.
Importance of understanding processes and getting certified 38:50
Understanding processes and what you want to accomplish is crucial.
Terms like Six Sigma and Green Book are examples of frameworks that can be used to get certified and get processes under control.
Lean manufacturing is an example of a framework that can help to make the industry more efficient.
BioTrack THC does not require RFID technology but can integrate with it.
If in a Metric state, tags are required within the grow and can be obtained from Metric.
Zebra Technologies is a recognized leader in providing RFID equipment, tags, and labels.
Part 3 will discuss the benefits of RFID technology in promoting social equity in the cannabis industry.
Integration of RFID data with Metric or other state programs 53:46
All state systems have APIs that can be used to connect with RFID data.
Companies like Zebra provide tools and SDKs to help developers write applications that can read RFID data.
These APIs can be used to push, pull, and extract data from the regulatory systems.
The state regulatory systems have a minimum requirement for what data needs to be provided. However, companies can extract more data and manipulate it for their benefit.
Public APIs for Metric can be accessed through a state number like co, mt, md, etc. followed by “metric” or “api.metric.com”.
The same goes for Kern and BioTrack in those states.
The data that can be extracted from these APIs varies based on what the state allows.
Other IoT technologies that are more cost-effective than RFID 56:53
IoT stands for the Internet of Things, which refers to connected devices.
BLE is an IoT technology that is more cost-effective than RFID.
However, RFID passive has come a long way in terms of cost.
ROI is an essential factor when deciding on a technology to adopt.
A good ROI is around four months, and if an application can provide a return on investment in four to five months, it is a worthwhile program to invest in.
It is crucial to look at the cost-effectiveness of a technology based on what you’re trying to achieve and what it’s costing you.
There is no passive RFID technology available that can read within a car.
It is passive, and metal reflects the RF energy, making reading the RFID tag inside a delivery van impossible.
UWB technology can be used to track RFID strength signals in a car, but there are no passive RFID tags that can be used in the industry.
Understanding RFID technology and its energy usage 01:03:19
RFID technology works at the same set of regulations that cell phones work off of, so they can’t put out any more energy than a cell phone does.
The minimum amount of energy that RFID readers use is very minimal.
The RFID technology works by a set of regulations that limit the amount of energy used by the reader.
The RSS data return signal strength is used to show the strength of the signal sent back by the RFID reader.
The RSS data is affected by various factors like how far away the tag is, how much energy was harvested, how it took to turn on the tag, how much it sends back, and more.
The RSS data can be affected by the wetness of the plants or if the RFID reader is inside a vehicle.
To read something in a car, one can use an active tag, which costs around $20.
Outfitting the inside of a car with an RFID reader 01:04:18
Customers are interested in outfitting the inside of their car or van with an RFID reader.
It is possible to put a reader in the vehicle, power it up off the vehicle battery, and connect it to a cellular network via cellular modem.
Reading the tag from outside of the vehicle would be quite difficult because of the physics involved.
Promoting diversity and inclusion in the industry 01:05:00
The speakers discuss what can be done to promote social equity, diversity, and inclusion in the cannabis industry.
The partnership with the medical cannabis community is one of the steps that organizations are taking to promote diversity in the industry.
The organizations are committed to doing what they can to promote diversity within the industry.
One of the speakers suggests reaching out to high school kids, particularly young girls and people of color, to encourage them to consider software development as a career option.
The challenge to the audience is to pay attention to who’s around them and what they’re doing in their community and hold them accountable for their actions.
Spending money says a lot about what kind of support one is giving, so pay attention to where one is spending their money.
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