Date: June 14, 2024

Background:

Since 2021, Michigan co-packers The Lab has produced over 9,000,000 pre-rolls, underscoring their dedication to rapid growth and efficient manufacturing. As the business started to grow, managing inventory in disparate systems created data silos, redundant processes, and higher admin costs to operate in multiple systems. In order to successfully scale, The Lab quickly recognized the need for a centralized database to create more efficiency around manufacturing, inventory management and sales.

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Challenges:

The Lab relied on multiple systems and was without a Metrc-integrated solution. The team primarily used Fishbowl, the ERP software manufacturers choose for inventory management. However this created two main challenges:

1. Fishbowl is not uniquely created for cannabis operators. Meaning, without a compliance integration in place, the team spent hours managing inventory across data silos and on duplicated data entry tasks, i.e., sales orders are received/managed on one platform, a material sheet is then created separately from Google Sheets to go with the sales order. The inventory needed for the sales orders is managed separately in Fishbowl –and all of these cannabis actions must also be manually entered in Metrc.
2. Managing cannabis and non-cannabis inventory was challenging since Metrc tracks only cannabis inventory and non-cannabis inventory is tracked outside of Metrc. This created a disjointed view of materials to be used across multiple production plans. The team needed an accurate and real-time view of their inventory as it moved from production to finished goods to sustain complex supply chains and sales opportunities.

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Solution:

Canix’s ERP functionality and robust integration with Metrc provided The Lab with a seamless solution for managing both cannabis and non cannabis inventory while submitting all compliance actions from the backend:

1. Metrc Integration - The integration between Canix and Metrc reduced the time and touchpoints in Metrc by over 20 hours per week.
2. Cost & COGS with Bill of Materials Canix created automation using Bill of Materials (BOM). Bill of Materials in Canix can be used to ensure teams use a consistent set of materials, and that the COGs associated with those materials are properly tracked. The BOM is automatically triggered when creating the finished good product, automating the tracking and usage of non-cannabis (NCI) goods and COGS calculation.
3. Inventory Availability & Non-Cannabis Inventory With Canix, The Lab gained a live view of both cannabis and non-cannabis inventory. The result? The Lab can manage production plan materials to be used within Canix’s Manufacturing module. The manufacturing module allows the team to consume both cannabis and non-cannabis inventory to create new, finished goods products while automatically syncing everything to Metrc.

“Within a week or two of implementing Canix, our three-person Setup/Staging Team was saving 20-30 hours weekly due to reduced METRC touches and improved inventory tracking. Our Production Team Leads each saved about an hour per shift due to improved workflow and automation built around Canix. We have gained the equivalent of two extra humans on our 50-person team, for less than the cost of a single salary, as well as increased visibility of our finished goods and internal production orders.” - Nathan Russell, CEO at The Lab

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Impact:

The implementation of Canix brought about transformative results for The Lab's inventory management processes:

1. Time & Labor Savings: Canix centralized The Lab's inventory management, saving the Setup/Staging Team 20-30 hours weekly and Production Team Leads an hour per shift, while gaining the equivalent of two employees for less than a single salary.
2. Cost Savings: By eliminating the need for multiple systems, Canix drastically decreased software spend and rendered Fishbowl obsolete, ensuring consistency, accuracy, and completeness in data integrity.
3. Streamlined Visibility: Canix provided a comprehensive view of The Lab's data, including cannabis and non-cannabis inventory, package availability status, and chain of custody, enabling better decision-making, strategic planning for materials and sales, and increased visibility of finished goods and internal production orders.

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Conclusion:

The Lab's transition from Fishbowl to Canix marks a strategic shift towards streamlined operations and enhanced efficiency in inventory management. By addressing the challenges of disparate systems and lack of compliance integration, Canix provides a comprehensive solution tailored to The Lab's needs. The implementation of Canix resulted in significant time and cost savings, centralized data management, and increased visibility into inventory and sales processes. With Canix, The Lab gained the agility and insight needed to sustain complex supply chains and drive strategic decision-making, positioning them for continued success and growth in a competitive market.

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