As cannabis dispensaries continue to navigate the myriad laws and regulations governing their business on a state-by-state basis, there's one area that remains a constantly dynamic source of uncertainty and frustration: payments.
In almost every other form of retail, "Cash or credit?" is a pretty benign issue left to the customer to decide, and the business has decades of experience processing either option. As anyone taking the time to read this knows, that's not the case for cannabis dispensaries. And you all know why, so we don't need to go into background here. Let's skip ahead to solutions, and namely the one this article will explore: cash recycling.
What is cash recycling?
Cash recycling is the process of taking in a cash payment, process that payment through the business' financial system (it's accepted, recorded and added to the bank account), and then it is safely and securely stored on-location for future use. When needed, that money can be dispensed back out through normal business transactions. This whole process is executed via a cash-validation recycling machine, or a cash recycler.
What's the difference between an ATM and a cash recycler or cash recycling machine? What about a normal register till vs. a cash recycler?
An ATM can only dispense money that was previously loaded on the ATM, whereas a cash recycler can handle deposits and dispense that same deposited note back out. So, from a retail / dispensary perspective, you're depositing money directly into your company's bank account every time you accept a payment. Because the cash recycler's job is to automate cash counting, identify unit types, and identify and decline fraudulent notes, the cash recycler removes manual or human variables that can cause discrepancies and loses associated with normal register drawers.
How do dispensaries benefit from cash recyclers?
First and foremost, cash recyclers automate cash-handling processes, and they do it with utmost accuracy. Like we mentioned above, they also prevent acceptance of counterfeit or illegitimate notes. In the cannabis world where compliance is king, that's already a huge burden lifted off your staff's shoulders.
In addition to accuracy and compliance, the automation of the cash-handling process itself increases operational efficiency. The outcome for dispensaries here is there's no need to count the register, balance receipts, all that laborious, time-consuming work that humans have to do. So, it's reducing labor costs, at the end of the day.
Finally (or at least the final major point we'll make here), is, of course, security. Cash recyclers act as safes. Simple as that when it comes to physical security. From an operational perspective, as previously stated, you're removing a large part of the human element from the cash-handling process. Not that we don't want to trust our staff, but people can be sneaky, or just plain make legitimate mistakes, so it's always better to be safe than sorry.
Consider the insurance ...
Depending on the setup or approach of your store (which is also dependent on the state you're in), cash recyclers introduce some interesting considerations when it comes to insurance. In the banking world, cash recyclers are being used to reduce the number of cash deliveries they need to stock ATMs, as well as reduce the amount of cash they need to keep on hand, because they're not pulling money out of circulation--it's all coming from one pool. Everyone's situation is going to be a little different, but there are implications here when it comes to how much coverage you need based on how much cash your store(s) have on hand. Just food for thought ...
A current and enduring solution.
Cash recyclers offer advantages for dispensaries in the present legal environment, but that doesn't mean those advantages will disappear in the future when (hopefully) regulations become standardize and less strict. Cash is never going to fully disappear, so your investment in cash recycling solutions is going to carry on for years to come.
Questions about cash recyclers or other physical security and retail solutions for dispensaries? Let us know and we'll get back to you ASAP!