Metrc compliance for cannabis retail

It's no secret that the entire California cannabis supply chain has had issues with Metrc since it's rollout in January of 2020.

If Metrc instability is creating delays in your dispensary sales and inaccuracies in your transactions, you want to be sure you're able to quickly identify and fix the discrepancies to stay within California's required 5% inventory variance.

However, it's crucial to understand what is a limit of Metrc, and what is a limit of your dispensary's point of sale system.

We know that CDTFA is starting to use Metrc variance as a means of audit across the California supply chain, which means having a system that keeps you fully compliant is more important than ever.

Under Track and Trace, "a significant discrepancy in inventory is a five percent difference between the licensee’s physical inventory and the inventory recorded in the track and trace system."

If a significant discrepancy is identified, the licensee is required to notify the DCC within 24 hours. Failure to identify and report any inventory discrepancy over 5% will put you up for greater scrutiny and increase your chance of a painful audit.

If you are not regularly counting your inventory, the percentage of discrepancy will likely become higher with time. To stay ahead of this, regularly count your inventory and report any discrepancies in a timely manor. If the discrepancy is not reported, you could risk losing your license. So, let’s put the safeguards in place to avoid these scenarios!

While the minimum requirement is counting your inventory once every 30 days, we suggest conducting "Cycle Counts" much more frequently to keep your inventory organized both physically and digitally. Read more about Meadow's Cycle Counts for Smarter Dispensary Inventory Management

The High Cost of Low-Cost Solutions:

While some new operators choose a POS software system on price alone, you’ll soon discover you get what you pay for. For instance, if your sales data is not being accurately reported to Metrc, or your tax calculations are not accurate, you may end up with an expensive compliance mistake or tax liability which requires hiring specialized consultants or comes with large fees and audits to untangle, which ends up creating a big headache. Read more about How to Choose a Cannabis Dispensary POS System

3 Metrc Red Flags for California Cannabis Retailers to Watch Out For

Here are three Metrc red flags that cannabis retailers can use to identify a compliance problem, as shared with us recently by software consultant Brian Maravandi from AlfaLINQ. Brian and his team at Alfalinq are part of our trusted network of compliance advisors that we’ve worked with to help dispensaries and teams rectify and correct Metrc inventory discrepancies when teams are switching over to Meadow's compliant solution.

Red Flag #1: Negative Inventory

In Metrc, filter all your packages that have a quantity smaller than 0. You should not oversell packages; if you see more than a couple negative packages, you have a problem.

This is a problem that does not exist in Meadow. Many retailers struggle with thier system reporting on the wrong package or tag until it goes below zero, which can be a difficult mess to untangle and fix. Metrc won’t stop packages from going negative, but your inventory and point of sale system should never allow that.

Red Flag #2: Having way more products in Metrc than the inventory you actually have on shelves.

Does your Metrc account list 6000 packages? Or 12,000? Does that sound like way more than you actually have in stock? Then you probably have an issue.

With sophisticated Track and Trace package reception, purchase orders, and new product creation, Meadow's easy-to-use cannabis inventory management software simplifies complex workflows to reduce the time you spend managing your inventory, saving hours while meeting compliance requirements.

Advanced, industry-leading Metrc Track and Trace workflows proactively prevent discrepancies in inventory and create compliant purchase orders directly from your licensed Metrc transfers, directly in Meadow's cannabis inventory management software. With daily Metrc monitoring, Meadow ensures packages are uploaded correctly and any false negatives are rectified.

Red Flag #3: Inconsistent Reporting to Metrc

You need to be reporting data to Metrc every single day. Run a sales report in Metrc; if you haven't been sending daily reports, you are out of compliance.

Meadow's dispensary software is built in lockstep with shifting state and local regulatory requirements. If you've been using a system with clunky workflows built for another regulatory environment, it's time to upgrade to a 100% compliant system, with no CSV uploads, ever.

Los Angeles-based software consultant Brian Maravandi and his team at Alfalinq are part of Meadow's trusted network of compliance advisors that help cannabis retail teams rectify and correct Metrc inventory discrepancies as teams are switching over their software to Meadow. If you're a California dispensary team and you discover negative inventory in your active Metrc account, we can help get you clean up your Metrc account and put in new SOPs to maintain compliance reporting and optimize your tax reporting.

Think you may have a compliance issue? We're here to help.

Even when Metrc goes down, Meadow keeps your inventory, sales and tax data accurate. There's a reason why more California dispensaries and delivery operators are upgrading to Meadow.

Is your dispensary actually Metrc compliant? We'll let you know.

Meadow's unique integration with Metrc means:

Meadow Uptime:

When Metrc is down, the Meadow API will automatically keep trying to connect, and will pull packages and transfers automatically so you don't have to wait and keep clicking or checking. Check out our status page where we've maintiained 99.99% uptime for 10 years and counting.

Never Upload a CSV:

Meadow syncs your sales data automatically at the end of the day with no manual labor required.

Flexible SKU management:

One SKU can have multiple packages that map to it, without creating Metrc messes.

No Negative Inventory:

While other systems let you oversell, Meadow's built-in guardrails keeps you compliant with clean inventory.

Active Account Monitoring:

With daily Metrc monitoring, our team ensures packages are uploaded correctly and any false negatives are rectified.

Don't take our word for it. See what our clients say about us on G2.

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