Looking to the future of the CannaTech industry? Consider this forecast.
According to Marijuana Venture:
Cannabis businesses expect to spend more money on technology in the coming year, but they see a bright future on the horizon, according to a recent 420MSP 2022 CannaTech survey.
The methodology for the survey was simple: more than 100 readers answered 13 questions that spanned from technology spend to stacking and ranking cannabis technology areas and ending with a series of questions about what social media platforms respondents use.
Question: Do you anticipate your 2022 cannabis technology spend to increase, decrease or stay the same?
Answer: By an overwhelming margin, 91% of the respondents expect to increase their cannabis technology spending, while only about 9% said it will stay the same. No one suggested their cannabis tech spending will decrease. The results of this question are very important for managed services providers, independent software vendors, original equipment manufacturers and distributors as they respond to increased demand for their goods and services.
“Across the industry, not only resellers but technology manufacturers are getting into the space to have a presence in the cannabis vertical, so you’d expect to see spending growth,” said Duane Roebuck Sr., marketing channel manager for the global tech distributor BlueStar. “The industry is being more legitimized and (operators) are embracing more technology spend. I had more resellers and technology manufacturers reach out directly to me to participate. This sector is getting more attention than it’s ever gotten.”
Question: If applicable, do you expect your 2022 cannabis technology revenue to increase, decrease or stay the same?
Answer: The results were remarkably similar to the first question with 90% expecting increased revenue. Again, this underscores the optimism for cannabis industry growth across the board. Interestingly, the survey period was right at the start of the COVID-19 Omicron threat, which caused extreme volatility in global financial markets.
Question: Stack and rank the importance of cannabis technologies.
Answer: This was the most interesting part of the survey. Seed-to-sale was listed as the most important technology category, followed by infrastructure. Cybersecurity and automation were tied at No. 3, with compliance rounding out the top five.
What stood out here was that compliance is considered the least important part of the cannabis technology stack. It suggests cannabis practitioners perceive they are on top of compliance matters. With infrastructure coming in second place, that suggests we’re really seeing business maturity in the cannabis vertical that mirrors other maturing business verticals. Personally, we anticipated cybersecurity to rank higher as it often leads in forecast polls in other industries.
Question: What are your intentions for technical staffing in 2022?
Answer: We were surprised that staying at the same staffing level was the most common response at 54.5%. Increased hiring was at 45.5%. Quite frankly, we anticipated exactly the opposite. Maybe the labor shortage is recasting how cannabis firms are viewing talent expansion. No respondent planned to decrease staff.
“While people are very interested in this space, a lot of people are putting their toe in the water and not jumping right in,” Roebuck said.
Question: What is the average revenue per employee in the cannabis space?
Answer: It’s important to point out the distinction that this question was about average revenue per employee and not what the employee makes as compensation. This is important data when trying to measure the market size for the cannabis technology space.
More than 63% of the respondents said the average revenue per employee at a cannabis tech firm falls between $50,000 and $75,000 (skewing closer to $75,000). The results then have a long tail of a widely dispersed range leading up to $250,000 per employee.
Compare the results here to the traditional technology channel targeting the managed service provider marketplace where the average revenue per employee at technology companies is $200,000 per employee.