I have said it before and it is worth repeating: Legalization is sexy but implementation sucks!
Washington Bud Company is a boutique batch, artisan-grown brand that showed steady growth since mid-2016 when we transitioned into the legal seed-to-sale system controlled by the Washington State Liquor and Cannabis Board.
Then Nov. 1, 2017 hit. That was the Liquor and Cannabis Board’s deadline for implementation of MJ Freeway’s new traceability system. Stores had stocked up in October and were wary of taking in too much product until the new system settled in.
But that didn’t happen. The new system was not ready prior to the expiration of the initial traceability contract. The industry rallied to find a solution and did so successfully while the state’s new LEAF data system was being further tested.
We were given a 30-day extension to a new deadline, which we bumped into, again, without a successful roll-out. The deadline was extended another two months to Feb. 1, 2018. During this time, the industry-provided system, based upon .cvs files uploaded to the state every Sunday night, was simple and it was working. Yet, the holidays are a typically slow time for the weed business and the confidence to conduct business was waning. Sales showed it.
When Feb. 1 arrived and the LEAF system went live, industry-wide chaos followed and our sales plummeted. The connections between the third-party software companies and the state’s system was fracturing before our eyes. Inventory numbers randomly changed, test results no longer reliably attached to harvests, bar codes scanned sometimes — but not always — and quantities and prices scrambled. It became impossible to conduct business on any timely level.
And sales took another dive. We had to lay off our crew for several days in mid-February hoping the system’s bugs would get worked out. We had to devote three times the labor to get out orders. Efficiency went out the window.
The Liquor and Cannabis Board’s newest stance is that licensees just didn’t pay enough attention to successfully transition and the third-party integrators are the problem. They have now made it clear that this new system is not an inventory control system but an enforcement platform.
I was on the state’s traceability workgroup, spending precious hours trying to help guide this effort and communicate with various trade groups. During that time, the license fees were increased by 43% to pay for this new system. It is embarrassing to admit that I had no idea how awful this was going to be. I was completely unprepared for sales orders to flip quantity numbers for package prices. I was completely unprepared for harvest numbers to double or disappear altogether. Solid compliance is basically non-existent as I write this.
I can deal with a lot if I know the facts. I am a survivor. We will get through this, but it sucks — big time!