Your organization is staffed with capable, committed workers who have helped grow your cannabis business through these early stages. However, the overall efficiency of the business is hampered by issues that are all too common: difficulties compiling data, repetitive business processes, and delays in accessing critical information. These problems may seem systemic and insurmountable, but they are merely indicators that it’s time to review your current business processes and consider upgrading to a modern and sophisticated cloud ERP system.
In fact, if you’re spending hours in Excel (or even in QuickBooks), the training wheels need to come off and your business needs to switch to business software that fits with the unique needs of the cannabis industry and can keep up with the rate of growth your business is undergoing.
Cloud accounting solutions will give cannabis businesses access to unified management and financial reports spanning their business – in real-time – to support their accelerating growth. Here are some of the leading indicators it’s time to consider migrating to the cloud.
- Too Many Manual Processes: Manual processes leave room for error and mistakes to occur. Manual processes could include paper approvals, manual check signatures, decentralized billing processes, or Excel-based reporting, . Modern, cloud-based solutions allow permissioned systems that drastically reduce the chance of errors and fraudulent practices.
- Regulatory Compliance Issues with On-Premises Software: Legacy systems are often not GAAP or HIPAA compliant, don’t employ IFRS books, and have weak audit trails. The regulatory framework of accounting often changes, which means outdated accounting software may expose your company to unnecessary risk. Always stay up-to-date, and always be in compliance. Cloud ERPs like Sage Intacct automatically update periodically, with a slew of new features and compliance updates.
- Inability to Track Data Accurately / Lack of Dimensionality: Dimensional metadata is an absolute must for any business in our modern times. Too many businesses are currently not tracking key data points that can impact decision-making in their organizations. A dimensionalized ERP can transform your business and reporting by tracking key metrics at the line item level. Sage Intacct can even auto-populate selections & create dynamically filtered data lists, dependent on a previous selection.
- Gaps in Security & Controls: Legacy systems typically are light on security settings. Administrators should have full control over what information their staff can access. Chances for fraud can and should be reduced, and a permissioned ERP can nearly eliminate this risk. Modern systems allow administrators to create role-based permissions for their staff at a granular level. Some users might have the ability to submit & post journal entries, while another user might have a ‘review’ role.
- Reliance on Microsoft Excel: Statistics claim that most, if not all, Excel workbooks contain at least one error. Relying on Excel for data tracking and/or financial reporting is a risky proposition, as spreadsheets require a lot of maintenance, include faulty formulas, etc. A cloud-based ERP can introduce entirely new methods of automation to assist in all areas of your business.
- Lack of Access to Timely Information/Visibility: Too often, businesses rely on one individual to pull data and run reports from multiple sources. This hampers your ability to make decisions in real time, and reporting is inconsistent. Members of management are often using different data sets and methodologies, muddying insight into actual performance. Leverage a cloud ERP to integrate data sources for dashboard & self-service reporting in real time.
- Separate Accounting Instances for Each Legal Entity: Multi-entity companies have traditionally been torturous to maintain financial books for in legacy systems. Maintaining multiple accounting systems, multiple logins, complex intercompany & elimination entries, inability to produce consolidated/consolidating reporting, and duplicate records are several reasons to move to a cloud ERP.
[sch_pullbox]But what separates Sage Intacct from the rest of cloud ERP pack? There are several key reasons for a maturing cannabis company to look at migrating to a cloud ERP system:
- Industry-Suitability: This is a solution primed for the cannabis industry – and as the only financial management solution preferred by the AICPA, it’s a mature software used across a myriad of companies that is open to working with the industry. Other industry-specific solutions are immature and glitch-prone.
- Open API: There’s certainly no shortage of data collection in your business – whether it’s in your compliance system (i.e, Metrc) or your inventory/wholesale system (i.e., Leaf Trade) – and Intacct’s open API affords the integration ability to minimize manual data entry and give you a holistic, accurate picture of your business.
- Reporting Granularity: Intacct offers eight reporting dimensions (as opposed to three in Quickbooks), providing the ability to report on a number of facets of your business. For example, by tying ‘Item IDs’ in Intacct to your inventory management system’s ‘Plant IDs’, you can start making associations between your sales data and item data. These “micro-margins” drive data-based decision-making and will help you understand your true costs and profitability across a number of data points (plant, crop, room, etc).
- Improve Cash Flow and Minimize Taxes: Beyond the profitability of micro-margin reporting, Sage Intacct will enable your business to more granularly allocate expenses to costs of goods sold, mitigating the impact of 280E. In our next blog, we’ll dive deeper into automating cost allocations to improve cash flow. [/sch_pullbox]
Your accounting software should help propel your growth, not slow you down. With Sage Intacct’s cloud ERP, you can pull reports with ease, and search and filter reports like revenue or profit by product, customer, project, location, fund, or any number of critical criteria. Use cloud-based technology to increase the scalability and security of your business—all from an easy to use dashboard—and maintain full compliance with built in financial controls.
If you’ve noticed that your outdated technology slows you down, Sage Intacct might be the answer, and SC&H Group’s Accounting Solutions team is the right business partner to choose. Our team will strategically evaluate your business processes and align them with your technology needs by customizing a tailor-made solution that will lead to more efficient use of time and greater profitability for your business.
We’re ready to discuss if this sounds like the right next step for your budding cannabis organization. Contact us today to get the conversation going.
