Colorado Changes Up Cannabis Tracking Methods
In 2023, there’s been another significant change in Colorado’s cannabis industry. Following years of navigating strict product tracking requirements for compliance, the Colorado government opted to alleviate the pressure by easing control measures. This change had to do with RFID tracking.
What is RFID?
RFID is an acronym that stands for radio-frequency identification. This tagging technology incorporates an electromagnetic field to create a unique identification that can be monitored. This tracking is applied to products now with a sticker attachment or tied to the product with a similar tag. The RFID tag can be scanned and tracked as it moves along and as long as the tag stays connected with the product it’s tailored to.
Why Does RFID Matter for Colorado?
For many years, RFID was the technology required for cannabis businesses to meet state requirements when moving their product. However, the demand for the tags also drove up their cost and created hefty expenses that dispensaries and producers had to pay. That expense was in turn passed on to customers, cutting into profits and raising the cost of products. However, this year the state has allowed for change, and the RFID tag is being given up as the specified tracking method. While cannabis businesses are still on the hook for tracking in general, the expensive RFID is no longer going to be required as of January 2024.
Inventory tracking will shift to some other method that the industry and regulators will need to find common ground, and there are multiple other methods available. The key factor is the use of a reliable system that isn’t easily tampered with, has a sequential span so there is no duplication of tracking identities, and is standardized across the state’s industry. All three factors together filter out some options but keep others in place.
The Cost of RFID Became a Burden
To understand what RFID means to the cannabis industry, doing a bit of math helps. The cost of a singular tag runs anywhere from 25 to 45 cents. Now, take that figure and multiply it against the number of cannabis plants transported, each one needing a tag, and totaling 1,029,683 units in September alone. That comes out to an operating expense of something between $257,000 to $463,000 just to be in business with cannabis. The logic of giving companies and dispensaries another option quickly makes sense if the state wants to support the success of the industry.
So, yes, the RFID change has had an impact on companies all over Colorado, including Mountain Annie’s Cannabis Dispensary among others.
The ability to save on operating costs gives these businesses the ability to reallocate, which can mean more jobs and more market growth, benefiting the state as well as communities.
