LeafLink, the nation's leading cannabis wholesale platform, today announced Payment on Sell Through (PoST). This is the first payment option for wholesale cannabis that guarantees brands will be paid the same way retailers pay for their sales. Along with Direct Pay and FlexPay, PoST is the third payment option offered on the LeafLink platform. In July, LeafLink acquired Dama Financial to provide customers with access to reliable, secure, and compliant banking solutions. This new payment option is another important step toward building a cannabis e-commerce ecosystem that helps businesses operate more efficiently.
With PoST, payments to brands (suppliers) are guaranteed and brands receive automated weekly payments based on the previous week's sell-through by retailers. This new model will reduce delinquent payments to brands, free up much-needed capital for retailers, provide data insights that support better business decisions, and create a more profitable cannabis industry. Helpful in construction.
“Over the past two years, we have focused on improving our platform to meet the needs of our customers, especially in the financial services space,” said LeafLink CEO Artie Minson. “LeafLink generates an average of 100,000 orders per month, and the need for a solution to address payment delinquencies is as important as ever. With PoST, we are committed to increasing transparency and ensuring payment to all parties involved. We are introducing a tool that will help pharmacies reduce upfront costs and back-end losses while ending payment arrears. We strongly believe that it will be transformative, ushering in a new era of efficiency and solving one of the industry's biggest pain points.”
Brands now set payment terms and are responsible for tracking outstanding receivables. On the other hand, retailers need to set aside large amounts of cash to purchase large quantities of products and stock them in stores, often with little data to support their decisions. And they're stuck with large accounts payable, disconnected from their actual cash flow and performance of the SKUs they stock. PoST aims to solve this problem with an effective payment model that mirrors other consumer packaged goods, while offering many additional benefits. With PoST, retailers can keep more capital in hand and pay only when the product is sold to the end consumer. Brands can increase sales of their products by increasing foot traffic to retail stores through marketing campaigns that increase awareness and interest.
PoST is currently available in Michigan, Mississippi, and Colorado, with plans to expand to additional states this year and next. Customers interested in using PoST should contact their account representative for more information.
According to an April report from Whitney Economics, payment delays in the cannabis industry will amount to more than $3.8 billion in 2023, equivalent to about 1.6 months of legal cannabis sales nationwide. The main cause of arrears is due to missed payments from pharmacies to brands and growers. Retailers are in a tough environment, struggling with cash flow constraints, limited startup capital, federal tax issues due to continued nationwide prohibition, and competition from the illicit market.
PoST improves inventory insights by identifying the right SKU, quantity, and order frequency for each store. This detailed data helps you avoid stockouts and out-of-stocks by providing accurate data that is updated daily. This detailed visibility also helps brands base upstream product development on real consumer data. The result is a more collaborative partnership between brands and retailers to optimize product sell-through and meet consumer demand.
Real results: Improved data quality, increased savings, accelerated payments.
PoST is already showing promising results in beta. More than 70 customers have implemented it into their workflows since the first trial began in June. Michigan-based cultivation company Six Labs was one of the first to use PoST and has documented its results. Since June, we have adjusted our three SKUs to avoid inventory obsolescence and overstock, proactively replenished our SKUs using transaction data, increased order sizes to meet discovered demand, and added new products. We doubled sales of the old SKU to make room for the new SKU. Six Labs is currently expanding its PoST integration with four other retailers.
said Ron Gibori, CEO of Six Labs. “PoST gives us visibility into how our products are performing and enables us to order the right amount for each retail partner and location.” You can stock the right products, earn more money, and receive more frequent and consistent orders.”
Michigan-based retailer Bloom City has also adopted PoST and is documenting its results. Since implementing PoST, Bloomcity has doubled sales of existing aging products through a discount strategy, increased orders for SKUs that are selling better than previously thought, and no longer requires up-front payment for inventory. This freed up much-needed cash on hand and improved analysis of sales data, resulting in zero outage days.
“PoST has changed the way our clients think about cannabis wholesale commerce. On the sales side, Six Labs sees tremendous value in having direct access to sell-through data and guaranteed recurring payments. , we have already rolled it out to a number of additional customers,” said Sandra Lee, Controller, CannaPro Solutions. We are a company that helps licensed cannabis dispensaries, processors, and cultivators with their back office needs. “On the purchase side, Bloom City Club has helped us gain powerful insights into product performance and optimize orders for each store. I have since brought this program to multiple other retail chains. The PoST model is a win for both brands and retailers, and we look forward to seeing it change the industry for the better.”
Contact: Press@LeafLink.com
About Leaf Link
Founded in 2016, LeafLink is the cannabis wholesale industry's leading B2B technology platform, helping thousands of customers in more than 30 markets buy, sell, pay and ship orders. LeafLink believes that improved access to modern financial services will propel the industry towards sustainable growth. In July 2024, LeafLink announced the acquisition of Dama Financial, a leading cannabis banking platform, to provide access to secure, reliable, and compliant banking. In 2024, LeafLink was named to Fast Company, a list of the best places to work for innovators in the banking, finance and fintech sectors, and was also awarded Green Market Report's Best Cannabis Fintech award.
