Northern Block Successfully Completes Proof-of-Concept — Blockchain Enabled Seed to Sale Verification Solution, With Complete Chain of Custody and Compliance Monitoring
Cannabis Industry Overview
In 2018, Canada became the first G-7 nation to recreationally legalize adult use of cannabis. Markets continued to see cannabis companies securing public listings long with large valuations — according to research done by Marijuana Business Daily, cannabis sales would reach USD $10.5–12.8B internationally in 2018. Today, most of the businesses growing, processing and selling cannabis are small independently-held entities. That will likely change in 2019 which looks like a big year for industry mergers, acquisitions and expansion. Large companies, like those in the food, tobacco and pharmaceutical industries have mostly stayed on the sidelines, held back by regulatory concerns, but are now expected to enter the market. There’s already been some action. Altria, which makes Marlboro cigarettes and recently made headlines by investing in Juul, through a 45% stake purchase in the cannabis company Cronos for around $1.8 billion, and has an option to gain a majority interest in Cronos in the future.
To date, Cannabis licenced producers’ profit margins have been very healthy due to the global shortage of cannabis supply, unable to meet the growing demand. However as more production licences are issued, non-vertically integrated producers will see their profit margins diminish as cannabis becomes commoditized. To maintain growth, producers must focus on building strong products and brands.
The Cannabis market is beset with numerous and inconsistent regulatory requirements for both recreational and medical purposes. With rapidly expanding markets due to recreational use legalization and the emergence of ancillary cannabis products, growth opportunities are evident.
Customer knowledge and product differentiation are almost non-existent, resulting in products being commoditized and prices being suppressed. As a result, organizations are not maximizing brand value.
As markets mature, supply shortages will be filled, demand will be driven from savvier consumers, price pressures will increase and organizations will need to lower their pricing to compete with international, lower cost producers.
CannaProve is a blockchain-based data infrastructure that enables one, immutable version of cannabis supply chain provenance information.
Through a set of API service layers, CannaProve’s modular interface enables supply chain participants to integrate their existing software applications to get:
- Dashboards for growers to monitor their growing sites, including pricing and product mix suggestions to optimize revenue potentials.
- Product and site data mining tools for regulators to monitor compliance adherence and manage reputational risk.
- Bar/QR code integrations for retailers to provide full chain of custody and product details to their customers.
- Provenance and chain of custody data for Pharmaceutical clients to ensure desired product performance.
Founded on principles of revenue optimization and cost management, CannaProve leverages its deep knowledge of blockchain technologies for a user-rich, yet simple to implement system that enables supply chain participants to be agile and responsive to turbulent markets, while capturing maximum value.
Mathieu Glaude, founder of CannaProve sees their holistic blockchain-based system as being an enabler for licenced producers to create premium brands and explore higher pricing points:
“We believe we have a huge opportunity to define the standard of quality for premium cannabis products. By partnering with key software providers and incorporating transportation and logistics components into a common supply chain ledger, we are creating the first truly holistic seed-to-sale solution, guaranteeing authenticity of chain of custody and provenance data to the retailer and consumer.”
Based in Toronto, Canada, CannaProve is at the epicenter of the emerging Cannabis market and the blockchain world and is led by a world class team of software engineers and industry experts.
- Comfort that production and logistics are in compliance, reducing risks and costs.
- Increased brand differentiation enabled with end consumer tools to drive up revenues.
- Increased demand information to help growers optimally meet market demands, increasing revenues.
- Increased compliance oversight without the need for invasive and inefficient audit processes.
- Reduced reputational risk for growers and their host governments.
We’re looking for seed to sale companies and cannabis cultivating companies to partner with for pilot projects. To learn more or to get a product demo, schedule a call with our team. We’d love to talk to you.