Chain Reaction: Weed industry takes a hit from the supply chain

Chain Reaction: Weed industry takes a hit from the supply chain

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BUCHANAN, Mich. --- The marijuana industry is taking a hit from the supply chain too! The issues being realized are things that go into growing, packaging and selling marijuana.

If you can’t find any pre-roll cones or vape cartridges it’s likely because of labor shortages and disruptions in the supply chain.

Disruptions in the supply chain are unique in the cannabis industry. Marijuana products can’t move across state lines because of federal law. So, what’s sold in Michigan is grown in Michigan.

So, what’s behind all the backups? As Rick Paniagua, founder of Cannavista Wellness explains it, it’s an issue with high demand and low supply. Basically, too many people want to get high.

“The demand for the product is no secret. In the early days supply was an issue. Lack of suppliers, lack of licensed producers, that’s changed,” Paniagua said.

Panigua says they aren’t dealing with as many supply problems with the expansion of marijuana suppliers in Michigan since legalization in 2018.

“We always have some issues getting some products. But right now, there’s enough variety and alternatives that we can substitute something we cannot find with something we can.”

That’s not to say cannabis suppliers haven’t had problems of their own. Lighting and technology needed to grow marijuana and package it for retail sale is what gets backed up in the supply chain.

That’s where MainStem comes in. CEO Alen Nguyen explains that using a procurement software, MainStem helps solve supply chain issues for cannabis companies.

“Since we are a rapidly growing industry, we’re still not as large as some of the other industries out there,” Nguyen said. “So, they take lower priority on the shipping and logistics. We’re not only growing and figuring out our supply chain and how much demand there is. We’ve got the complications of also fitting into the global supply chain.”

Take these edible THC gummies as an example. The ‘Kiva’ brand treats were supposed to hit store shelves in November with the name ‘Holiday Punch.’

They didn’t make it to retail shops until February and they have a new name – ‘Supply Chain Chaos.’

 “The gummy itself was made here in the states. So, the gummy was available and they could’ve got it out in time for the launch but the packaging was made overseas! So, because of the supply chain delay, they didn’t have the time to package the gummies and get them out to dispensaries,” Nguyen said.

Alen expects supply chain issues to persist into 2023 for the cannabis industry and a new scope of problems if weed is ever federally legalized and can move across state lines.

Until that happens, Panigua says the best solution is local suppliers supporting local businesses and vice versa.

 “We like to represent good products, local companies, and bring them in at a fair price, Panigua said.

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