Emerging Cannabis Track-and-Trace Technology

by | Jun 2, 2022

Industry articles feature contributions from cannabis tech industry experts, company representatives, PR agencies, and ghostwritten Op/Eds. While we provide basic editorial reviews, views expressed in these articles do not necessarily represent those of Cannabis Tech.

Valuable insights can be gained from the successful regulation of cannabis and the emergence of cannabis track-and-trace technology. As the world’s supply chains, battered by the two-year COVID pandemic and related staffing and resourcing problems, continue to make headlines for a simple reason: they are still under dynamic stress. War in Europe, economic disruption, and dislocation are piling further uncertainty into an already volatile basket of risks to which there are no easy answers. One thing we do know, however, is that utilizing innovative technology and automation will be integral to helping solve our current supply chain woes.

Track-and-Trace Technologies

In the past decade, track-and-trace tools have been crucial in regulating cannabis effectively. With the ongoing debate around cannabis legalization and the need for transparency and consumer safety, the industry’s survival depends on it. As the cannabis industry is relatively new, states are adopting advanced data tracking technologies. Tech companies have made significant progress in track-and-trace technology, especially in the cannabis sector. These tools track plants and products from cultivation to sale, providing real-time updates and transparent history. Applying track-and-trace tools from cannabis to other industries can have transformative effects on consumer health, safety, and economic efficiency.

Building resilience in supply chains is a long-standing goal of both government regulators and business owners, and ultimately one that benefits consumers. Businesses want to move products; governments have an interest in protecting the health of consumers while safeguarding the flow of goods; consumers want and should expect that the products they buy are safe and effective. In cannabis, track-and-trace technologies help accomplish all of these objectives.

Typically, track-and-trace technologies use microchips embedded in radio-frequency identification (RFID) tags, which are then attached to each plant in the early stages of cultivation to store coded information that verifies the authenticity of the plant. Tags with the same information are then attached to end products, whether it be flower or any other cannabis CPG product. These tags help to secure markets against illicit products which carry a greater risk of being contaminated, thus protecting the health of consumers.

RFID Tags and Barcode Systems

Regulators can inspect cultivation facilities faster with RFID readers compared to line-of-sight barcode systems. They can also safeguard markets more effectively by accessing the real-time full product history. Similarly, businesses can streamline inventory checks and maintenance, increasing sell-through rate, simplifying fulfillment, improving customer satisfaction, and deterring theft. Non-cannabis companies like Walmart are adopting RFID tags for similar purposes, expanding the technology beyond apparel and footwear divisions into home goods and consumer electronics.

Track-and-Trace Technology

As of now, there aren’t other industries that have adopted this type of technology across the board to the extent that cannabis has. Yet, there are tremendous opportunities; RFID’s built-in efficiencies coupled with the scope, depth, and quality of data collected underscore the value of using similar approaches in other industries. By tracking individual products, companies and regulators can target and eliminate potential hazards before they bring harm to customers.

Addressing Product Recalls

Track-and-trace technologies have significantly reduced the risk of contaminated products reaching customers in the cannabis industry and prevented major recalls. However, recalls still occur frequently across various sectors. In 2021, FDA-regulated firms, including food and cosmetic companies, reported 427 recalls. Product recalls pose serious harm to consumers and can damage a company’s reputation, leading to substantial economic losses. According to a recent joint study, 77% of food, beverage, and consumer product companies experiencing a recall can lose $30 million in sales and direct recall costs. In the first half of 2020 alone, approximately 700,000 pounds of meat were recalled due to health concerns.

Track-and-Trace Technology

If companies were to implement RFID technology effectively in this sector, they would have the potential to trace a singular steak back to the processing facility, farm, and even the specific cow responsible for producing it. The power to trace health risks like salmonella outbreaks back to a singular source would allow producers and regulators to stamp them out quickly and effectively, keeping customers safe and minimizing financial losses.

Valuable Insights from Emerging Cannabis Track-and-Trace Technology.

Regardless of the industry, to effectively analyze supply chains and improve them, businesses and governments need a rich quality of data. Where are the problems? Where are the obstacles? What are the pain points? Track-and-trace tools provide these answers from comprehensive data collected in the field in real-time. Not only do track-and-trace tools empower businesses and regulators to be resilient and quickly remediate problems, but they add agility throughout organizations, allowing them to use data to anticipate problems and develop solutions before problems start to bite.

Cannabis is essentially the first sector to be regulated on a basis of actual, serviceable data, which corresponds to its newness. The use of track-and-trace technologies has elevated the industry as a whole, bringing agility to regulators and businesses alike. Still, the truth remains that any industry can achieve this level of transparency; informed insight leads to better oversight and more enlightened policy – and that’s in everyone’s best interest.