Running a Business / Data Management

Overlooking This One Thing Can Stop Your Cannabis Business in Its Tracks

Even if you're small, you're data infrastructure has to be robust.
Overlooking This One Thing Can Stop Your Cannabis Business in Its Tracks
Image credit: antoniokhr | Getty Images
Guest Writer
CEO of GeekTek
7 min read
Opinions expressed by Green Entrepreneur contributors are their own.

Cannabis business owners have to hit the ground running as soon as they get their licenses, but neglecting to develop a robust, scalable IT infrastructure will keep them running in place instead. Legalization and medicalization of cannabis, whether in the US, Canada or elsewhere in the world, has bestowed an extraordinary opportunity upon both entrepreneurs and seasoned hands with experience to scale up. But it also means they need to think like enterprises right away, even if they’re starting out small.

Overlooking IT needs during the business’s formative stages will result in a significant competitive disadvantage.

Weak IT Infrastructure: what could go wrong?

Most cannabis businesses spend a fortune on top-of-the-line surveillance systems and access control, but skimp on purchasing the necessary technology and security for their data and networks. Many rely on infrastructure designed for consumer use rather than professional use. Purchasing firewalls and routers off the shelf from a big box store, or using third-party cloud apps that are not specifically developed for enterprise use, can pose significant risks to their businesses. Cannabis businesses with weak IT infrastructure will eventually hit a wall, and in the worst case scenario, it can cost them dearly.

One example from GeekTek’s professional history provides a poignant and teachable moment. A Los Angeles-based fashion design company saw its business grow exponentially after a local celebrity endorsed its brand on national TV. However, on the eve of its busiest season, a disgruntled contractor erased all of its data as revenge for non-payment. All efforts to revive its data were unsuccessful. The company had to rely on a bookkeeper’s notes to rebuild their database. Even after putting forth so much effort, it was unable to make up for lost sales and damaged reputation. The company went out of business within one year of that incident.

This story is not unusual. According to the SEC (Securities and Exchange Commision), more than half of all businesses that fall prey to such attacks go out of business within six months. However, the right IT infrastructure can safeguard against such tragedies. Cannabis operators don’t have to master IT in order to secure their infrastructures but operators in dynamic industries like cannabis should understand a few important things about IT to help them find an appropriate IT partner.

Related: 7 Hottest Jobs in the Cannabis Industry Right Now

Piercing the buzz about cloud infrastructure.

Many businesses mistake cloud infrastructure for a stand-alone scaling strategy. Strictly speaking, being in the cloud means that they are making a choice about where their data lives. In the cloud, companies have infrastructure; it’s just not in their offices. A cloud infrastructure only possesses a good scaling strategy if the business followed these three steps:

  • Tethering all of the mobile and stationary devices in its network to its cloud infrastructure.

  • Implementing strong cybersecurity policies atop its data usage and storage practices.

  • Designing its cloud infrastructures so it can integrate -- or remove -- new software, employees and components of its businesses swiftly.

The cloud can accommodate business growth, but it won’t do so in and of itself. However, sound management principles, preferably implemented early on in a business’s evolution, can assist.

Related: Creating Positive Marijuana Awareness Should be Part of Every Cannabis Branding Initiative

Aligning IT infrastructure with business objectives.

Whether on the cloud or off, an IT infrastructure that is ready to scale generally incorporates the same guiding principles, and it starts with enterprise-grade tools. Businesses, rather than selecting the cheapest option, should purchase technology which provides their workers with the necessary management features and train their staff to use them correctly. Network traffic should be properly segmented, with a trusted provider monitoring a strong firewall for intrusions. Cabling should be structured. Finally, businesses must develop appropriate standard operating procedures and a well-defined IT policy in order to create a solid foundation for any IT infrastructure.

After building this foundation businesses must consider the particulars of their verticals. For instance, if they are in cultivation, they may be working with IoT (Internet of Things)-enabled software that allows for remote access of data or even control of their respective grow’s fertigation or light cycles. They will need to segment all areas of their networks to prevent all but authorized users to access their cultivation centers’ nerve units.

Many IoT devices can also be easily hacked, and so they should be monitored more closely than the other elements of a given network. There may also be custom software or a software suite that teams are using as well, based on the cloud or off, that has its own unique integration and security issues. However, regardless of the particulars, the right infrastructure is one that’s easily manageable, easily protected and monitored on an ongoing basis.

Related: Report: Sales of Cannabis Concentrates Expected to Triple to $8.5B by 2022

What to ask the IT architect.

Businesses can learn much about any given IT professional’s suitability for the job by asking the right questions:

What have you scaled before?

If cannabis businesses intend to grow -- and they all do -- they need to identify candidates with experience in growing businesses. It’s a fundamentally different skill set than maintaining a static outfit, no matter how experienced a given provider might be.

What frameworks or technologies do you typically deploy in situations like mine and why?

Businesses should ask “why?” several times during the conversation and listen to their responses. Regardless of whether or not a given hiring manager knows the answer to these questions, s/he should be able to determine whether the provider possesses the appropriate knowledge for his/her vertical.

What problems do we need to be considering now and how will you specifically address those issues as we grow?

No matter the vertical for a cannabis business, the right IT provider should alert the business to the problems that it wouldn’t anticipate itself, particularly issues pertaining to cybersecurity, asset management and mobile/local device management. The IT provider should also have its eyes trained on upcoming data trends, such as AI (Artificial Intelligence) and blockchain-enabled security devices, and know which ones are worth paying attention to.

What will this cost?

Enterprise-grade IT infrastructure and services are a costly investment, but they are a worthy one.  Consider the volume of data that needs to be secured and protected, and the importance of a sound infrastructure that keeps cannabis businesses running. In this regard, IT is an important part of their budget and all good businesses should plan for it so that they aren’t caught off-guard by a disabled network or cybersecurity attack.

Thankfully, a good IT infrastructure scales easily. When cannabis businesses go multi-state and develop greater organizational complexity, they may have different LLCs or different corporations in each one of the states or provinces. But the IT infrastructure can be an umbrella that covers all of their entities. Once they put it into place, like accounting, HR and other vital professional services, it grows with them and it goes everywhere they go, both within the United States and outside of it. But it can only do so if it’s properly designed from the very start.

By Javier Hasse
From retailers to growers, producers, and suppliers, there’s a seemingly never-ending list of startup opportunities in this emerging market. In Start Your Own Cannabis Business, marijuana, biotech, and entrepreneurship reporter Javier Hasse introduces forward-thinking entrepreneurs like you to the industry and shares hard-earned tips and success stories from pioneers and visionaries in the marijuana industry.
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