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As of early 2024, 24 states, the District of Columbia, and Guam have legalized recreational cannabis use for individuals age 21+: Alaska, Arizona, California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nevada, New Jersey, New Mexico, New York, Ohio, Oregon, Rhode Island, Vermont, Virginia, and Washington. According to projections from Statista, total revenue from cannabis is expected to reach $39.85 billion in 2024.
With growth comes competition and competitive pricing trends among cannabis brands and retailers. This has led to significant price declines and slim profit margins. This blog pulls out highlights from the Cannabis Equipment News (CEN) podcast on how TEKLYNX is helping cannabis manufacturers and companies of all sizes eliminate errors in cannabis labeling to help increase efficiency and profitability.
Learn about cannabis labeling software
David Mantey (DM), CEN: What are some of the trends you're seeing right now in terms of what cannabis operators are demanding when it comes to labeling?
Scott Fabian (SF), TEKLYNX: We're seeing companies spend so much time on labels—usually because the data that’s required to be on the label is not easily accessible. The data is in a cloud warehouse management or ERP system not connected to their labeling software, so they must manually type in all the data required by the state. The state requirements are expanding in scope for much more data. Currently, a lot of companies download spreadsheets with the necessary data—these are tough to manage and become outdated as soon as you download them.
So, it's all about how we get the data in the right spot with as few clicks as possible, which is why we partnered with Confident LIMS, formerly Confident Cannabis, to develop print forms that grab lab test results live and put it on the labels. We just recently became validated with Metrc, so right now it’s all about getting the data onto the label and making it easier to print and design.
DM: At what stage of the process are people coming to you? Are they already struggling with label issues or is it a new cannabis operator looking to do everything right out of the gates?
Nick Recht (NR), TEKLYNX: We’ve seen every part of the process. The most common thing we see and help with is people who have beautiful artistic labels on their jars of buds or their doob tubes (pre-rolls) but they're over-labeling it—meaning they're applying an additional thermal transfer black and white label with test results on a label. They approached us because they want the art and the test data to be printed simultaneously. So, we're coming into the picture when they're going from potentially ordering pre-printed labels to wanting to print color labels in-house on demand.
DM: Is the cannabis industry different than others, like food and beverage, when it comes to the sophistication of artwork combined with the volume of information that needs to be on the label?
NR: I'd say it's very much the same. It's the people who are different. More established industries have been manufacturing for a long time, so applying data on a barcode label that might be used for packaging or shipping and receiving is more accepted. In the cannabis space, you have a lot of people who started a business from a passion project. They're not bringing a lot of manufacturing best practices to the table until it becomes a problem they see getting in the way of profitability or efficiency.
DM: Is it easier to work with the seasoned vets or with the people that don't know what they're doing just because they're a little bit easier to shape in terms of what works best?
SF: Both. It's been a lot of fun in the cannabis industry just showing people what's possible. When I'm showing people the Confident LIMS print form, where you just select a label and it populates the lab data, the O-factor is huge. Being able to share our experience and bring the best practices we've found to cannabis has been a lot of fun.
DM: What kind of ROI (return on investment) are people looking at?
SF: It depends on how much time people are spending labeling and how error-prone the process is. For example, we have one customer who spent eight hours a day pulling and prepping data, then labeling stuff. Using TEKLYNX label design and print automation solutions, that person now spends seven and a half hours doing other things for the business.
DM: That's important, especially in an industry that struggles to find good labor. Is labeling an afterthought in cannabis?
SF: It's an afterthought all the time. One of our partners called it the humble barcode label—it’s not really noticed unless you're scanning it, but it holds all the value for seed-to-sale tracking and efficient manufacturing.
DM: What are some common mistakes you see when it comes to labeling or the low-hanging fruit people could fix right away in their own labeling operations?
NR: Manual data entry. For example, if your lab results are stored in Confident LIMS and other compliance data is stored in Metrc, and you're looking between databases and keying that information onto labels, there’s huge room for error. You can get a pretty good return on your investment simply by looking to the single source of the truth to pull that data directly onto your label template.
DM: Are your software solutions scalable for cannabis operators of all shapes and sizes?
NR: Our customers run the gamut from mom-and-pop shops to multinational corporations using our solutions. There are more mom-and-pop shops in cannabis now than there are big players. We’re seeing a lot of success with small deployments—a label designer, a print form, and a small amount of integration work to access data seamlessly.
We also do business with two of the big names in Illinois who oversee the cultivation, processing, and retail for various cannabis brands. For operational scalability and efficiency, you really get a bang for your buck with label automation. When you have a machine automatically print and add a label to a product or box, you can see how much time it's going to save by not having somebody manually do it.
DM: One critical issue for cannabis operators is sustainability. How can sustainability play a role when it comes to labeling?
NR: You have to think about waste reduction when you're talking about sustainability in labeling. When you have an error-prone manual labeling process and an incorrect label is applied to a package, you have wasted label stock and potentially the package in which that label went on.
Waste from inaccurate labels could be as small as a few wasted labels, or as massive as hundreds of thousands of dollars spent on a product recall.
Learn how to eliminate waste in label printing.
DM: What would you say is the future of cannabis labeling?
SF: The biggest thing is the potential of federal legalization and having a larger governing body come in and say, “This is how we're going to do it. This is the right stuff. This is stuff we need on the label. This is how we keep the seed-to-sale supply chain intact.” Like the automotive or food and beverage industries, having industry regulations and standard across all cannabis businesses.
TEKLYNX: The Most Forgotten Part of Efficient Manufacturing
Download a free 30-day trial of CODESOFT to design custom color labels on demand; integrate with Confident LIMS, Metrc, or other cannabis software; and automatically print weight captured from a scale directly onto labels.
Want to know if there’s a better way to label your cannabis plants, packages, or products? Get in touch to see how we can grow your business together.
Scott Fabian is a technical engineer and developer at TEKLYNX. Scott has seen a dramatic variety of use cases across nearly every industry and has found great success in implementing efficient labeling processes at every level with his intimate knowledge of TEKLYNX solutions. He works closely with the product team, working on new features and solutions to continually meet the needs of an ever-evolving landscape of label printing and technology. When not at work, Scott loves playing volleyball and attending concerts with family and friends.
Connecting your labeling system with your current business systems, like an enterprise resource planning (ERP) system or warehouse management system (WMS), can boost your ROI without investing in a new system. By using what you already have and adding automated labeling, you can tap into your existing data to get a clearer view of operations.
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The future of cannabis labeling centers around the efficiencies companies can create to overcome the business challenges of today: timely manual processes prone to human error, disjointed data sources, state-by-state packaging and labeling requirements until cannabis is federally regulated, and inflexible systems hindering expansion. As cannabis companies are maturing and investing in technology, we’re getting more questions about ways to streamline labeling operations and future-proof labeling environments.
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