January 18, 2022

How to handle METRC inventory recalls with your cannabis POS

November 24, 2021
January 18, 2022

All types of retailers have one thing in common: product recalls can be a hassle that costs a lot of time, energy, and money. With the recent lab testing recall in Michigan, and a history of other recalls in various states that use METRC’s reporting software, now is the perfect time to prepare your store and staff with a product recall plan.

If you’re not familiar, recalls are part of every retail industry. They are especially important to be mindful of in cannabis, because items with similar harvest dates get produced and sold in batches, similar to fresh fruit or your favorite coffee roaster. Tracking every part of a recall often involves a lot of manual work.

Cannabis product liability

A common misconception in cannabis sales is that dispensaries who outsource their product are not liable for any product defects. This is not always the case. Depending on the state, retailers can be held liable for products that create health issues in customers. While this is not common, you should still protect your staff, customers, and business.

Another issue, mentioned in this legal advice article, states: “In most industries, recall standards are dictated by either federal or state law or both.” In this case, since cannabis isn’t federally legal, no federal agency has provided an outline of how to navigate recalls in the cannabis space. Rest assured, we are here to help protect your business with insight that applies to most state regulations.

Because our friendly neighbors up north do have federal support, they have a guide to refer to for Canadian product recalls.

Now, let’s go over some basics of cannabis recalls for METRC users in the US.

How cannbis product recalls work

Typically, the regulator will communicate out recalls and then METRC will put them on hold in their reporting system at the request of the state. This means you should pay close attention to the channels of communication that could tell you vital information about your inventory and how to protect your store.

The regulator notifies the license holders.

For things like plant matter, having a well-educated purchasing team will start you in the right direction. A keen-eyed staff can look for defects in the flower that some processors may have missed. Often, these issues are hard to spot and you can rely on the regulator to contact the license holder of your business. Notifications normally get sent through email to the licensees and anyone subscribed for updates on their site. Make sure you are checking for these communications regularly.

Why do product recalls happen?

Product recalls are typically a result of a testing or lab reporting error. Generally, recalls don’t allow for retesting of that same product batch. So the managers (or compliance managers) gather up the product and follow the state guidance on either returning or destroying the product.

Don't have an auto-syncing POS? Here’s how to manually handle a recall:

  • Go to the On Hold Packages section of METRC and collect every item that matches that description in the store.
  • Be sure to double check the regulator notice for exceptions, sometimes the issue is only linked to products with certain consumption methods.
  • Then, individually mark these items “not for sale” in the POS system.
  • Separate the product in your inventory room until you come to a resolution.

These steps will help prevent any staff oversights that can leave your company in hot water.

The store management can either get it retested if the state allows, or return it to the vendor. There are different steps for either, and the state will usually provide guidance regarding which route to take and how to proceed.

Generally, recalls don’t allow for retesting. So the other advice is just to gather up the product and follow the state guidance on either returning or destroying it. Luckily, this situation in Michigan does allow for retesting so the product doesn’t necessarily have to go to waste.

For the current Michigan situation with the Viridis products, MRA placed a hold on all packages with tests from these facilities, but there are product type exceptions. If packages of the exempted types (in this case, cartridges and concentrates) are still marked on hold, the state is probably in the process of removing those holds. You should not sell this product while it is still on hold, especially to MED patients, as it may not be reported in real time as required. Be sure to follow MRA’s guide, or contact them here for more help.

How to get ahead of future recalls

The manual process of handling a recall can be stressful with repetitive checks and data entry. That’s why LeafLogix by Dutchie can help save you valuable time.

Dutchie POS automates the recall procedure, so you don’t have to worry about updating your inventory in the point of sale or verifying SKUs within METRC. How does this work? It’s pretty simple.

We’ve recently boosted our integration with METRC to allow the recalled products to sync to your inventory automatically. With this feature enabled, flagged inventory will appear as On Hold in the POS.

Here are the protections it provides:

  • Clearly view On Hold inventory on your Inventory Grid.
  • This inventory is quarantined, preventing items from being added to a cart in the register.
  • If On Hold products are already in a cart, the transaction can't be completed until they are moved.

Liability insurance is another option to protect your store, but the retailers that have to destroy the product may already be at a financial loss. That’s why you should look for a POS that is compliant from the ground up.

During stressful times, we try to give our partners some peace of mind. Be diligent about each of these steps, in your store and in your software. After all, safety is the most important part of selling legal cannabis.

*Disclaimer: Dutchie does not give legal advice.

About the author
The Dutchie Squad