Sales within the U.S. legal cannabis industry are expected to reach $23 billion by 2025.
The projected growth should be exciting news for businesses in this space, however, an increase in sales activity will likely bring evolved risks and exposures—especially for dispensaries.
So what are the top security challenges facing dispensaries today?
Here’s a look at the top 3 security risks in 2021—along with a handful of tips that can help mitigate them.
- External Theft
As primarily cash-run operations, dispensaries are at a greater risk for theft. Storing large amounts of cash in a single location is like putting a giant target on your storefront. While certain financial institutions are offering services to cannabis businesses, many have reported significant challenges in doing so—making it difficult for dispensaries to avoid cash transactions.
- Internal Theft
According to MJ Daily, dispensaries are at risk for losing tens of thousands of dollars a year due to employee theft. In fact, security experts estimate that nearly 90 percent of revenue and product loss in the cannabis industry is due to internal theft.
Data privacy is a growing concern for the medical and recreational cannabis industry. Just last year, a POS software program used by many cannabis dispensaries across the U.S. was hacked, exposing and making accessible nearly 85,000 customer files containing sensitive medical data to anyone on the internet. As online and virtual transactions increase in usage, so will this evolving risk.
Risk Mitigation Tips:
- Properly vet all employees to identify potential issues prior to hiring.
- Establish security protocols to prevent employee collusion, limit access to certain areas where theft can be an issue, and train managers on how to respond to an employee theft situation.
- Consider surveillance cameras and/or an alarm system.
- Implement employee training regarding cyber security best practices.
- Develop a cybersecurity incident response plan to help limit damage and reduce recovery time.
- Review all insurance coverages and secure a cyber liability policy.
- Discuss proactive claims prevention efforts with your broker.
If you need help determining what type of insurance your cannabis dispensary needs, contact me at email@example.com or 626-703-1556.