The cannabis industry has off late gained immense popularity owing to its recent legalization in some of the countries. This has not only opened the window of opportunities for cannabis ventures looking to make the most out of it, but also the investors who are looking to gain from the flourishing cannabis stocks. The global cannabis industry continues to surpass all expectations of growth making it the most sought after stock in recent times. A report by Grand View Market Research projects the legal cannabis market to be worth around $140 billion within the next seven years. Well, those numbers look quite impressive!
However, is the grass greener on the other side as well? Because the regulatory framework for regulating the cannabis is yet to be fully established, its market is quite volatile and prone to risks as well. Many new investors get attracted by stock promotion and hype or merely the appealing nature of the business but fail to analyze its financial conditions. Here is a list of the most common mistakes to be avoided while investing in cannabis ventures:
- Ignoring companies’ financial statements: Before investing in any company, the foremost thing an investor must do is to go through its annual reports or maybe press releases to decide whether the company is worth investing. The hype created by the cannabis industry has benefited even the losers for some time. These statements help you to determine whether their growth is momentary or it has the long-term growth potential.
- Investing out of speculation: As the cannabis industry is still very much in its infant stages, it is subject to high levels of volatility. Under such circumstances, it becomes challenging to distinguish the winners from the losers, and ultimately investors with little knowledge about the company may fail to realize any profit. The best way to avoid such a mistake is to leave aside speculative news and hypes and focus more on company based data.
- Failure to diversify: The most optimal way to make the most out of an investment is to diversify your portfolio as much as possible, especially in the cannabis sector which has minimal operating experience. A well-diversified portfolio will act as a safeguard against the potential losses. Betting solely on cannabis stocks would only increase the probability of incurring losses.
- Emphasis on too much diversification: While diversifying a portfolio is very much essential, but too much diversification can do little good. If a person invests in 20 stocks with negative expected returns, this can dilute his entire investment. Diversification should be kept at an optimal level with stocks distributed proportionately.
- Little knowledge about Cannabis investment: Cannabis stocks are OTC (Over The Counter) stocks. As exchanges like NSE and NASDAQ have very strict market-price and share-cap requirements, cannabis ventures find it difficult to list their stocks there. This makes these stocks even riskier as they are outside the regulatory purview of SEC. Therefore, complete knowledge about the company operations is vital to make an informed decision.
If you want to run an effective and compliant cannabis business, you will need to use the best cannabis software on the market. There are many traditional and online cannabis dispensaries popping up lately, and this has created a need for proper software. Your requirements may vary depending on whether you are involved in cultivation or only associated with sale of the end products. So let’s assume that your business includes all operations from seed to sale of cannabis in the dispensary.
You need the best cannabis software to simplify the intricate process and most importantly streamline your operations with key data points and custom workflows. This is essential to optimize the future yields with the cultivation of weeds and cannabis business.
Key Benefits Of Using Software For Cultivation Operation
The cultivation operations are one of the most important aspects of cannabis business. Unless you take care of the various aspects involved in the operations, you will not be able to optimize the yield. Whether you have a large outdoor garden or an indoor cultivation space, here are a few ways you can benefit from using software:
- Forecast for Yield – Software can help you monitor and analyze the harvest data. This comes handy in optimizing larger yields.
- Genealogy Tracking – This is another important aspect of cannabis software. It helps in keeping records and tracking cross-breeding of the different strains. It also aids in monitoring the clone strength results.
- The software offers custom workflows to help growers weigh multiple plant by-products, both wet and dry. It also helps with multiple data collection and grading of product quality after curing.
- Software helps in analyzing the results. It keeps a check on the nutrients and pesticides applied, logs the strain notes along with specific light and water cycles.
- Software also aids in monitoring the effects of pesticides and nutrients applied, log strain notes detailing light and watering cycles, plus refer to the past harvest data to optimize the next yields.
Processing and Manufacturing Stage
This is the next stage in the cycle and the best cannabis software can help you maintain a record of the necessary data for compliance. It allows you to automatically port the essential information required for labeling products, increasing transparency, saving time, processing and manufacturing cannabis.
Whether you want to convert weed into single or multiple by-products (oil and edibles), the software helps in complete conversion tracking. It is useful in generating purchase orders and invoices for easy record keeping. Adding numerous product details to the inventory items and including product information on labels also becomes easier.
At the Dispensary
Finally, at the dispensary, which is the point of sale, the best cannabis software helps in automating the discounts and loyalty programs. It can also set the purchase limits so that you never sell more than the allowed limit to a particular customer or patient. It also helps you manage CRM tools to offer loyalty rewards and referrals. This software will also have the feature to let you create customer profiles to keep record of purchase history, medical preferences, rewards points and so on.