Cannabis Operations Suite

Complete Technical Implementation Roadmap

$2B+
Market Size by 2033
28.3%
CAGR Growth
$10M+
ARR Target

Table of Contents

1. Executive Summary

  • • Market Opportunity
  • • Hybrid Suite Advantage
  • • Revenue Projections

2. Technical Architecture

  • • System Design
  • • Technology Stack
  • • Database Schema

3. API Integrations

  • • Metrc Compliance
  • • POS Systems
  • • Implementation

4. AI/ML Implementation

  • • Prophet Forecasting
  • • Dynamic Pricing
  • • Churn Prediction

5. Security & Compliance

  • • SOC 2 Requirements
  • • Data Encryption
  • • Audit Trails

6. Deployment Strategy

  • • Production Setup
  • • Scaling Strategy
  • • Performance Optimization

1. Executive Summary

Market Opportunity

Cannabis Technology Market Growth

  • • Cannabis Industry Software: $1.3B (2024) → $4.5B (2033)
  • • North America Cannabis Tech: $12.7B → $71B (28.3% CAGR)
  • • 47% of Americans live in legal cannabis states
  • • Average dispensary loses $50K-200K annually to inventory issues

Hybrid Suite Advantage

AI Inventory

Prophet forecasting, auto-PO generation, expiration alerts

Compliance

Metrc/BioTrack integration, real-time alerts, audit trails

Loyalty/CRM

AI segmentation, churn prediction, SMS campaigns

Dynamic Pricing

Competitor monitoring, margin protection, revenue optimization

Key Market Insights

  • No comprehensive all-in-one platform exists in cannabis space
  • • Dispensaries use 4+ separate tools, causing data silos and integration complexity
  • • Customer acquisition cost for cannabis SaaS: $200-400 (2-3x higher than general SaaS)
  • • Hybrid suite provides 3-4x customer LTV vs single-feature competitors

2. Technical Architecture

System Architecture Overview

┌─────────────────────────────────────────────────────────────────┐
│                       CLIENT LAYER                              │
├─────────────────────────────────────────────────────────────────┤
│  Web App (Next.js 15)     │  Mobile App (React Native)         │
│  - Inventory Dashboard     │  - Push Notifications              │
│  - Forecast Visualizations │  - Quick PO Approval               │
│  - Alert Management        │  - Barcode Scanning                │
└─────────────┬───────────────────────────────────┬───────────────┘
              │                                   │
              │         API Gateway (FastAPI)      │
              │         - Rate Limiting (Redis)    │
              │         - Authentication (JWT)     │
              │         - Request Logging          │
              ▼                                   ▼
┌─────────────────────────────────────────────────────────────────┐
│                     APPLICATION LAYER                            │
├─────────────────────────────────────────────────────────────────┤
│  ┌──────────────┐  ┌──────────────┐  ┌──────────────┐         │
│  │   Inventory   │  │  Compliance  │  │   Loyalty    │         │
│  │   Service     │  │   Service    │  │   Service    │         │
│  └──────┬───────┘  └──────┬───────┘  └──────┬───────┘         │
│         │                  │                  │                  │
│  ┌──────▼──────────────────▼──────────────────▼───────┐        │
│  │           Pricing Service & ML Engine               │        │
│  │  • Prophet Forecasting  • Dynamic Pricing         │        │
│  │  • Churn Prediction     • Competitor Monitoring    │        │
│  └──────────────────────────────────────────────────────┘        │
└─────────────┬───────────────────────────────────┬───────────────┘
              │                                   │
              ▼                                   ▼
┌──────────────────────────┐    ┌──────────────────────────────┐
│    DATA PERSISTENCE      │    │    BACKGROUND JOBS           │
├──────────────────────────┤    ├──────────────────────────────┤
│ PostgreSQL + TimescaleDB │    │ Celery + Redis               │
│ • Multi-tenant Schema    │    │ • Forecast Generation        │
│ • Time-series Optimization│   │ • POS Data Sync              │
│ • Inventory Snapshots    │    │ • Alert Processing           │
│ • Customer Analytics     │    │ • Compliance Monitoring      │
└──────────────────────────┘    └──────────────────────────────┘

Frontend Technology Stack

Next.js 15 (App Router)

SSR, API routes, excellent DX, Vercel deployment

Tailwind CSS + Shadcn/UI

Rapid development, consistent design, accessible components

React Query + Zustand

Server state management, automatic caching, optimistic updates

Backend Technology Stack

FastAPI (Python 3.11+)

Fast async performance, native ML integration, auto-generated OpenAPI docs

PostgreSQL + TimescaleDB

Time-series optimization, complex queries, JSONB support

Prophet + Scikit-learn

Time series forecasting, ML models, demand prediction

Architecture Decision: Modular Monolith → Microservices

Start with a modular monolith for faster MVP development, then extract services as needed:

  • Phase 1 (MVP): Single FastAPI application with modular structure
  • Phase 2 (Scale): Extract ML/forecasting service for dedicated GPU resources
  • Phase 3 (Enterprise): Separate services for compliance, pricing, and analytics

Database Schema Design

Multi-Tenant Architecture

-- Core multi-tenant structure
CREATE TABLE organizations (
    id UUID PRIMARY KEY DEFAULT gen_random_uuid(),
    name VARCHAR(255) NOT NULL,
    slug VARCHAR(100) UNIQUE NOT NULL,
    plan_tier VARCHAR(50) DEFAULT 'starter',
    subscription_status VARCHAR(50) DEFAULT 'trial',
    trial_ends_at TIMESTAMP,
    settings JSONB DEFAULT '{}',
    created_at TIMESTAMP DEFAULT NOW()
);

-- Row Level Security for multi-tenancy
ALTER TABLE organizations ENABLE ROW LEVEL SECURITY;

CREATE POLICY org_isolation_policy ON organizations
    FOR ALL TO authenticated_users
    USING (id = current_setting('app.current_org_id')::UUID);

Product & Inventory Schema

-- Cannabis-specific product schema
CREATE TABLE products (
    id UUID PRIMARY KEY DEFAULT gen_random_uuid(),
    organization_id UUID NOT NULL REFERENCES organizations(id),
    location_id UUID NOT NULL REFERENCES locations(id),
    sku VARCHAR(100),
    name VARCHAR(255) NOT NULL,
    category VARCHAR(100), -- flower, edibles, concentrates
    strain_name VARCHAR(255),
    strain_type VARCHAR(50), -- indica, sativa, hybrid
    thc_percentage DECIMAL(5,2),
    cbd_percentage DECIMAL(5,2),
    current_quantity INTEGER DEFAULT 0,
    reorder_point INTEGER,
    unit_cost DECIMAL(10,2),
    retail_price DECIMAL(10,2),
    expiration_date DATE,
    is_active BOOLEAN DEFAULT TRUE,
    created_at TIMESTAMP DEFAULT NOW()
);

Time-Series Optimization with TimescaleDB

-- Time-series hypertable for inventory snapshots
CREATE TABLE inventory_snapshots (
    product_id UUID NOT NULL REFERENCES products(id),
    quantity INTEGER NOT NULL,
    location VARCHAR(100),
    snapshot_type VARCHAR(50) DEFAULT 'scheduled',
    source VARCHAR(50) NOT NULL, -- pos_sync, metrc_sync, manual
    recorded_at TIMESTAMP NOT NULL DEFAULT NOW(),
    metadata JSONB DEFAULT '{}'
);

-- Convert to hypertable for time-series optimization
SELECT create_hypertable('inventory_snapshots', 'recorded_at', chunk_time_interval => INTERVAL '1 day');

-- Compression policy for old data
SELECT add_compression_policy('inventory_snapshots', INTERVAL '7 days');

-- Retention policy
SELECT add_retention_policy('inventory_snapshots', INTERVAL '2 years');

Sales & Forecasting Schema

-- Sales transactions from POS
CREATE TABLE sales_transactions (
    id UUID PRIMARY KEY DEFAULT gen_random_uuid(),
    organization_id UUID NOT NULL REFERENCES organizations(id),
    product_id UUID NOT NULL REFERENCES products(id),
    quantity_sold INTEGER NOT NULL,
    unit_price DECIMAL(10,2) NOT NULL,
    total_amount DECIMAL(10,2) NOT NULL,
    customer_id VARCHAR(255),
    sold_at TIMESTAMP NOT NULL,
    synced_at TIMESTAMP DEFAULT NOW()
);

-- Demand forecasts
CREATE TABLE demand_forecasts (
    id UUID PRIMARY KEY DEFAULT gen_random_uuid(),
    product_id UUID NOT NULL REFERENCES products(id),
    forecast_date DATE NOT NULL,
    predicted_quantity DECIMAL(10,2) NOT NULL,
    confidence_score DECIMAL(5,4),
    model_version VARCHAR(50),
    generated_at TIMESTAMP DEFAULT NOW(),
    UNIQUE(product_id, forecast_date, model_version)
);

Customer & Loyalty Schema

-- Customer data for loyalty/CRM
CREATE TABLE customers (
    id UUID PRIMARY KEY DEFAULT gen_random_uuid(),
    organization_id UUID NOT NULL REFERENCES organizations(id),
    external_id VARCHAR(255), -- POS customer ID
    email VARCHAR(255),
    phone VARCHAR(50),
    first_name VARCHAR(255),
    last_name VARCHAR(255),
    birth_date DATE,
    customer_type VARCHAR(50), -- medical, recreational
    loyalty_points INTEGER DEFAULT 0,
    tier VARCHAR(50) DEFAULT 'bronze',
    last_purchase_at TIMESTAMP,
    total_spent DECIMAL(10,2) DEFAULT 0,
    created_at TIMESTAMP DEFAULT NOW()
);

-- Customer segments for ML
CREATE TABLE customer_segments (
    id UUID PRIMARY KEY DEFAULT gen_random_uuid(),
    customer_id UUID NOT NULL REFERENCES customers(id),
    segment_type VARCHAR(100), -- high_value, at_risk, new_customer
    confidence_score DECIMAL(5,4),
    assigned_at TIMESTAMP DEFAULT NOW()
);

3. API Integration Implementation

Metrc Compliance Integration

Authentication: HTTP Basic Auth with vendor + user API keys
Rate Limit: 100 calls/second
Base URL: https://api-{state}.metrc.com
import requests
import base64
from typing import Optional, Dict, Any
import asyncio
import aiohttp

class MetrcClient:
    def __init__(self, state: str, vendor_key: str, user_key: str):
        self.base_url = f"https://api-{state.lower()}.metrc.com"
        self.auth_header = self._create_auth_header(vendor_key, user_key)
        self.session = None
        
    def _create_auth_header(self, vendor_key: str, user_key: str) -> str:
        credentials = f"{vendor_key}:{user_key}"
        encoded = base64.b64encode(credentials.encode()).decode()
        return f"Basic {encoded}"
    
    async def get_packages_active(self, license_number: str) -> Dict[str, Any]:
        """Get active packages for compliance sync"""
        url = f"{self.base_url}/packages/v2/active"
        headers = {
            "Authorization": self.auth_header,
            "Content-Type": "application/json"
        }
        params = {"licenseNumber": license_number}
        
        async with aiohttp.ClientSession() as session:
            async with session.get(url, headers=headers, params=params) as response:
                if response.status == 200:
                    return await response.json()
                else:
                    response.raise_for_status()

    async def sync_inventory_compliance(self, license_number: str) -> None:
        """Sync inventory with Metrc for compliance validation"""
        try:
            metrc_packages = await self.get_packages_active(license_number)
            # Process and validate against internal inventory
            await self._validate_inventory_discrepancies(metrc_packages)
        except Exception as e:
            # Log error and create compliance alert
            await self._create_compliance_alert(str(e))

POS System Integration (Dutchie)

Authentication: API Key via HTTP Basic Auth
Rate Limit: 1000 calls/hour per location
Webhook Support: Real-time inventory updates
import aiohttp
from datetime import datetime, timedelta
from typing import List, Dict

class DutchieClient:
    def __init__(self, api_key: str, location_id: str):
        self.base_url = "https://api.pos.dutchie.com"
        self.api_key = api_key
        self.location_id = location_id
        
    async def get_inventory(self) -> List[Dict]:
        """Fetch current inventory from Dutchie POS"""
        url = f"{self.base_url}/inventory"
        headers = {
            "Authorization": f"Bearer {self.api_key}",
            "Content-Type": "application/json"
        }
        
        async with aiohttp.ClientSession() as session:
            async with session.get(url, headers=headers) as response:
                return await response.json()
    
    async def get_sales_history(self, days: int = 90) -> List[Dict]:
        """Fetch sales history for forecasting"""
        end_date = datetime.now()
        start_date = end_date - timedelta(days=days)
        
        url = f"{self.base_url}/sales/history"
        params = {
            "start_date": start_date.isoformat(),
            "end_date": end_date.isoformat(),
            "location_id": self.location_id
        }
        
        headers = {"Authorization": f"Bearer {self.api_key}"}
        
        async with aiohttp.ClientSession() as session:
            async with session.get(url, headers=headers, params=params) as response:
                return await response.json()

# Webhook handler for real-time updates
from fastapi import FastAPI, Request

app = FastAPI()

@app.post("/webhooks/dutchie/inventory")
async def handle_inventory_update(request: Request):
    """Handle real-time inventory updates from Dutchie"""
    payload = await request.json()
    
    # Validate webhook signature
    if not await validate_dutchie_webhook(request, payload):
        return {"error": "Invalid signature"}
    
    # Update internal inventory
    await update_internal_inventory(payload)
    
    # Trigger forecast recalculation if significant change
    if payload.get('quantity_change', 0) > 10:
        await trigger_forecast_update(payload['product_id'])
    
    return {"status": "success"}

Integration Challenges & Solutions

Common Issues:
  • • API rate limiting (especially Metrc at 100/sec)
  • • State-specific Metrc variations
  • • POS webhook reliability issues
  • • Data format inconsistencies
Solutions:
  • • Implement exponential backoff and queuing
  • • Create state-specific configuration layers
  • • Build fallback polling mechanisms
  • • Standardize data with transformation layer

POS System Market Share (2025)

4. AI/ML Implementation Guide

Prophet Time Series Forecasting

Performance: 6.64% average MAPE across 5 cannabis states

Advantages: Handles cannabis seasonality (4/20, holidays), missing data robust

from prophet import Prophet
import pandas as pd
from datetime import datetime, timedelta
import numpy as np

class CannabisInventoryForecaster:
    def __init__(self):
        self.models = {}
        
    def prepare_cannabis_data(self, sales_data: pd.DataFrame) -> pd.DataFrame:
        """Prepare sales data for Prophet with cannabis-specific features"""
        df = sales_data[['date', 'quantity_sold']].copy()
        df.columns = ['ds', 'y']
        
        # Ensure daily frequency
        df['ds'] = pd.to_datetime(df['ds'])
        df = df.groupby('ds')['y'].sum().reset_index()
        
        # Fill missing dates with 0 sales
        date_range = pd.date_range(
            start=df['ds'].min(), 
            end=df['ds'].max(), 
            freq='D'
        )
        full_df = pd.DataFrame({'ds': date_range})
        df = full_df.merge(df, on='ds', how='left').fillna(0)
        
        return df
    
    def create_cannabis_holidays(self) -> pd.DataFrame:
        """Create cannabis-specific holidays"""
        holidays = []
        
        # 4/20 Cannabis Holiday
        for year in range(2020, 2030):
            holidays.append({
                'holiday': '420_day',
                'ds': pd.to_datetime(f'{year}-04-20'),
                'lower_window': -2,
                'upper_window': 2,
            })
        
        # Green Wednesday (day before Thanksgiving)
        # Add other cannabis industry holidays
        
        return pd.DataFrame(holidays)
    
    async def forecast_product_demand(
        self, 
        product_id: str, 
        sales_history: pd.DataFrame,
        days_ahead: int = 14
    ) -> Dict[str, Any]:
        """Generate demand forecast for specific product"""
        
        # Prepare data
        df = self.prepare_cannabis_data(sales_history)
        
        if len(df) < 30:  # Minimum data requirement
            return {"error": "Insufficient data for forecasting"}
        
        # Initialize Prophet with cannabis-specific parameters
        model = Prophet(
            daily_seasonality=True,
            weekly_seasonality=True,
            yearly_seasonality=True,
            holidays=self.create_cannabis_holidays(),
            seasonality_mode='multiplicative',  # Better for sales data
            changepoint_prior_scale=0.05,  # Conservative for cannabis
            holidays_prior_scale=10.0  # Strong holiday effects
        )
        
        # Add custom seasonality for cannabis patterns
        model.add_seasonality(
            name='monthly_payday', 
            period=30.5, 
            fourier_order=5
        )
        
        # Fit model
        model.fit(df)
        
        # Generate forecast
        future = model.make_future_dataframe(periods=days_ahead)
        forecast = model.predict(future)
        
        # Calculate accuracy metrics if we have recent data
        accuracy_metrics = self._calculate_forecast_accuracy(
            df, forecast, days_back=7
        )
        
        # Cache model for this product
        self.models[product_id] = {
            'model': model,
            'last_updated': datetime.now(),
            'accuracy': accuracy_metrics
        }
        
        return {
            'forecast': forecast[['ds', 'yhat', 'yhat_lower', 'yhat_upper']].tail(days_ahead).to_dict('records'),
            'accuracy_mape': accuracy_metrics.get('mape', 0),
            'confidence_score': self._calculate_confidence_score(forecast, df),
            'model_version': 'prophet_v1.1'
        }
    
    def _calculate_confidence_score(self, forecast: pd.DataFrame, historical: pd.DataFrame) -> float:
        """Calculate confidence score based on forecast uncertainty and historical variance"""
        recent_forecast = forecast.tail(14)
        uncertainty = (recent_forecast['yhat_upper'] - recent_forecast['yhat_lower']).mean()
        historical_variance = historical['y'].var()
        
        # Lower uncertainty relative to historical variance = higher confidence
        confidence = max(0.1, min(0.95, 1 - (uncertainty / (historical_variance + 1))))
        return round(confidence, 3)

Dynamic Pricing Algorithm

import asyncio
from typing import Dict, List, Optional
import numpy as np
from dataclasses import dataclass

@dataclass
class PricingRule:
    min_margin_percent: float
    max_discount_percent: float
    competitor_weight: float
    inventory_weight: float
    demand_weight: float

class DynamicPricingEngine:
    def __init__(self):
        self.competitor_monitor = CompetitorMonitor()
        self.pricing_rules = {
            'flower': PricingRule(25.0, 15.0, 0.4, 0.35, 0.25),
            'edibles': PricingRule(35.0, 20.0, 0.3, 0.4, 0.3),
            'concentrates': PricingRule(40.0, 12.0, 0.5, 0.3, 0.2)
        }
    
    async def calculate_optimal_price(
        self, 
        product_id: str,
        current_price: float,
        unit_cost: float,
        current_inventory: int,
        demand_forecast: float,
        category: str
    ) -> Dict[str, Any]:
        """Calculate optimal price using multi-factor algorithm"""
        
        rule = self.pricing_rules.get(category, self.pricing_rules['flower'])
        
        # Get competitor pricing data
        competitor_prices = await self.competitor_monitor.get_competitor_prices(
            product_category=category,
            strain_type=product_id  # Simplified
        )
        
        if not competitor_prices:
            return {"error": "No competitor data available"}
        
        # Calculate pricing factors
        factors = await self._calculate_pricing_factors(
            competitor_prices, current_inventory, demand_forecast, rule
        )
        
        # Base price from competitor median
        base_price = np.median(competitor_prices)
        
        # Apply factors
        suggested_price = base_price * (
            1 + 
            factors['competitor_adjustment'] * rule.competitor_weight +
            factors['inventory_adjustment'] * rule.inventory_weight +
            factors['demand_adjustment'] * rule.demand_weight
        )
        
        # Ensure minimum margin
        min_price = unit_cost * (1 + rule.min_margin_percent / 100)
        max_discount_price = current_price * (1 - rule.max_discount_percent / 100)
        
        final_price = max(min_price, min(suggested_price, current_price * 1.1))
        
        return {
            'suggested_price': round(final_price, 2),
            'current_price': current_price,
            'price_change_percent': round(((final_price - current_price) / current_price) * 100, 2),
            'competitor_median': round(base_price, 2),
            'factors': factors,
            'confidence_score': self._calculate_pricing_confidence(factors),
            'reason': self._generate_pricing_reason(factors, final_price, current_price)
        }
    
    async def _calculate_pricing_factors(
        self, 
        competitor_prices: List[float], 
        inventory: int, 
        demand_forecast: float,
        rule: PricingRule
    ) -> Dict[str, float]:
        """Calculate individual pricing adjustment factors"""
        
        # Competitor factor: negative if we're above market, positive if below
        median_competitor = np.median(competitor_prices)
        competitor_factor = -0.05 if len(competitor_prices) > 3 else 0
        
        # Inventory factor: negative for overstock, positive for low stock
        days_supply = inventory / max(demand_forecast, 0.1)
        if days_supply > 30:  # Overstock
            inventory_factor = -0.08
        elif days_supply < 7:  # Low stock
            inventory_factor = 0.12
        else:
            inventory_factor = 0
        
        # Demand factor: positive for high demand, negative for low
        if demand_forecast > inventory * 0.1:  # High demand relative to stock
            demand_factor = 0.05
        elif demand_forecast < inventory * 0.02:  # Low demand
            demand_factor = -0.03
        else:
            demand_factor = 0
        
        return {
            'competitor_adjustment': competitor_factor,
            'inventory_adjustment': inventory_factor,
            'demand_adjustment': demand_factor
        }

class CompetitorMonitor:
    """Monitor competitor pricing from Weedmaps/Leafly"""
    
    async def get_competitor_prices(self, product_category: str, strain_type: str) -> List[float]:
        """Fetch competitor prices (implement based on your scraping strategy)"""
        # This would integrate with your web scraping or API solution
        # For now, return mock data
        return [25.50, 27.00, 24.75, 26.25, 25.00]

ML Model Performance Comparison

ML Implementation Roadmap

Phase 1 (MVP - Month 1-2)
  • • Basic Prophet forecasting
  • • Simple reorder point calculation
  • • Manual price adjustments
Phase 2 (Scale - Month 3-6)
  • • Advanced Prophet with cannabis holidays
  • • Basic dynamic pricing
  • • Customer segmentation
Phase 3 (Advanced - Month 6+)
  • • Ensemble forecasting (Prophet + LSTM)
  • • Real-time competitor monitoring
  • • Churn prediction models

5. Security & Compliance Implementation

SOC 2 Compliance Requirements

Security Controls

  • • Encryption at rest (AES-256)
  • • Encryption in transit (TLS 1.3)
  • • Multi-factor authentication
  • • Role-based access controls

Availability

  • • 99.9% uptime SLA
  • • Backup and disaster recovery
  • • Load balancing and failover
  • • Performance monitoring

Processing Integrity

  • • Comprehensive audit trails
  • • Data validation and checksums
  • • Error handling and logging
  • • Change management controls

Data Protection Implementation

from cryptography.fernet import Fernet
import hashlib
import secrets
from typing import Optional
import asyncpg

class DataProtection:
    def __init__(self, encryption_key: bytes):
        self.cipher = Fernet(encryption_key)
    
    def encrypt_sensitive_data(self, data: str) -> str:
        """Encrypt PII/PHI data for cannabis patients"""
        if not data:
            return ""
        return self.cipher.encrypt(data.encode()).decode()
    
    def decrypt_sensitive_data(self, encrypted_data: str) -> str:
        """Decrypt sensitive data"""
        if not encrypted_data:
            return ""
        return self.cipher.decrypt(encrypted_data.encode()).decode()
    
    @staticmethod
    def hash_api_key(api_key: str) -> str:
        """Hash API keys for secure storage"""
        salt = secrets.token_hex(32)
        hashed = hashlib.pbkdf2_hmac('sha256', api_key.encode(), salt.encode(), 100000)
        return f"{salt}:{hashed.hex()}"
    
    @staticmethod
    def verify_api_key(api_key: str, stored_hash: str) -> bool:
        """Verify API key against stored hash"""
        try:
            salt, hashed = stored_hash.split(':')
            test_hash = hashlib.pbkdf2_hmac('sha256', api_key.encode(), salt.encode(), 100000)
            return test_hash.hex() == hashed
        except:
            return False

class AuditLogger:
    def __init__(self, db_pool):
        self.db_pool = db_pool
    
    async def log_compliance_event(
        self, 
        organization_id: str,
        event_type: str,
        user_id: str,
        details: dict,
        risk_level: str = "low"
    ):
        """Log all compliance-related events"""
        async with self.db_pool.acquire() as conn:
            await conn.execute("""
                INSERT INTO audit_logs 
                (organization_id, event_type, user_id, details, risk_level, created_at)
                VALUES ($1, $2, $3, $4, $5, NOW())
            """, organization_id, event_type, user_id, details, risk_level)
    
    async def log_data_access(
        self, 
        user_id: str, 
        resource_type: str, 
        resource_id: str,
        action: str,
        ip_address: Optional[str] = None
    ):
        """Log all data access for compliance auditing"""
        await self.log_compliance_event(
            organization_id="system",
            event_type="data_access",
            user_id=user_id,
            details={
                "resource_type": resource_type,
                "resource_id": resource_id,
                "action": action,
                "ip_address": ip_address
            }
        )

Cannabis-Specific Compliance Requirements

Federal Considerations:
  • • Cannabis remains federally illegal - banking restrictions
  • • 280E tax code impacts - software often only deductible expense
  • • HIPAA applies to medical cannabis patient data
  • • Money laundering prevention (FinCEN requirements)
State Requirements:
  • • Mandatory seed-to-sale tracking (Metrc/BioTrack)
  • • Real-time inventory reporting to state systems
  • • Patient registry data protection (medical states)
  • • 90+ day video surveillance retention

Authentication & Authorization

from fastapi import Depends, HTTPException, status
from fastapi.security import HTTPBearer, HTTPAuthorizationCredentials
import jwt
from datetime import datetime, timedelta

security = HTTPBearer()

class AuthManager:
    def __init__(self, secret_key: str):
        self.secret_key = secret_key
        self.algorithm = "HS256"
    
    def create_access_token(
        self, 
        data: dict, 
        expires_delta: Optional[timedelta] = None
    ) -> str:
        """Create JWT access token"""
        to_encode = data.copy()
        if expires_delta:
            expire = datetime.utcnow() + expires_delta
        else:
            expire = datetime.utcnow() + timedelta(minutes=15)
        
        to_encode.update({"exp": expire})
        encoded_jwt = jwt.encode(to_encode, self.secret_key, algorithm=self.algorithm)
        return encoded_jwt
    
    def verify_token(self, token: str) -> dict:
        """Verify JWT token"""
        try:
            payload = jwt.decode(token, self.secret_key, algorithms=[self.algorithm])
            return payload
        except jwt.ExpiredSignatureError:
            raise HTTPException(
                status_code=status.HTTP_401_UNAUTHORIZED,
                detail="Token expired"
            )
        except jwt.JWTError:
            raise HTTPException(
                status_code=status.HTTP_401_UNAUTHORIZED,
                detail="Invalid token"
            )

# Role-based authorization
async def require_role(required_role: str):
    def role_checker(credentials: HTTPAuthorizationCredentials = Depends(security)):
        token = credentials.credentials
        payload = auth_manager.verify_token(token)
        
        user_roles = payload.get("roles", [])
        if required_role not in user_roles:
            raise HTTPException(
                status_code=status.HTTP_403_FORBIDDEN,
                detail="Insufficient permissions"
            )
        return payload
    return role_checker

Rate Limiting & API Security

import redis
import asyncio
from functools import wraps
from fastapi import HTTPException, Request

class RateLimiter:
    def __init__(self, redis_client: redis.Redis):
        self.redis = redis_client
    
    async def is_allowed(
        self, 
        identifier: str, 
        limit: int, 
        window: int
    ) -> bool:
        """Check if request is within rate limit"""
        key = f"rate_limit:{identifier}"
        
        try:
            current = await self.redis.incr(key)
            if current == 1:
                await self.redis.expire(key, window)
            return current <= limit
        except:
            # Fail open if Redis is down
            return True
    
    def limit_requests(self, requests_per_minute: int):
        """Decorator for rate limiting endpoints"""
        def decorator(func):
            @wraps(func)
            async def wrapper(request: Request, *args, **kwargs):
                # Use API key or IP address as identifier
                identifier = self.get_rate_limit_identifier(request)
                
                if not await self.is_allowed(identifier, requests_per_minute, 60):
                    raise HTTPException(
                        status_code=429,
                        detail="Rate limit exceeded"
                    )
                
                return await func(request, *args, **kwargs)
            return wrapper
        return decorator
    
    def get_rate_limit_identifier(self, request: Request) -> str:
        """Get identifier for rate limiting"""
        # Priority: API key > User ID > IP address
        api_key = request.headers.get("X-API-Key")
        if api_key:
            return f"api_key:{api_key}"
        
        user_id = getattr(request.state, "user_id", None)
        if user_id:
            return f"user:{user_id}"
        
        return f"ip:{request.client.host}"

# Usage in FastAPI endpoints
@app.get("/api/v1/inventory")
@rate_limiter.limit_requests(requests_per_minute=100)
async def get_inventory(request: Request):
    # Your endpoint logic here
    pass

6. Production Deployment Strategy

Infrastructure Architecture

Production Environment (AWS)
├── Load Balancer (ALB)
│   ├── SSL Termination (ACM Certificate)
│   └── Rate Limiting (AWS WAF)
├── ECS Fargate Cluster
│   ├── FastAPI Service (2-4 instances)
│   ├── ML Service (GPU-enabled)
│   └── Background Jobs (Celery Workers)
├── Database Layer
│   ├── RDS PostgreSQL (Multi-AZ)
│   ├── ElastiCache Redis (Cluster Mode)
│   └── S3 (File Storage + Backups)
└── Monitoring & Logging
    ├── CloudWatch Logs
    ├── DataDog APM
    └── Sentry Error Tracking

Development/Staging
├── Railway.app (MVP Deployment)
├── Vercel (Frontend)
└── Supabase (Database + Auth)

Docker Configuration

# Dockerfile for FastAPI Backend
FROM python:3.11-slim

WORKDIR /app

# Install system dependencies
RUN apt-get update && apt-get install -y \
    gcc \
    g++ \
    && rm -rf /var/lib/apt/lists/*

# Install Python dependencies
COPY requirements.txt .
RUN pip install --no-cache-dir -r requirements.txt

# Copy application code
COPY . .

# Create non-root user for security
RUN useradd -m -u 1000 appuser && chown -R appuser:appuser /app
USER appuser

EXPOSE 8000

# Health check
HEALTHCHECK --interval=30s --timeout=30s --start-period=5s --retries=3 \
    CMD curl -f http://localhost:8000/health || exit 1

CMD ["uvicorn", "app.main:app", "--host", "0.0.0.0", "--port", "8000"]

# docker-compose.yml for local development
version: '3.8'

services:
  app:
    build: .
    ports:
      - "8000:8000"
    environment:
      - DATABASE_URL=postgresql://user:pass@db:5432/cannabis_db
      - REDIS_URL=redis://redis:6379
    depends_on:
      - db
      - redis
    volumes:
      - ./app:/app/app
  
  db:
    image: timescale/timescaledb:latest-pg14
    environment:
      POSTGRES_DB: cannabis_db
      POSTGRES_USER: user
      POSTGRES_PASSWORD: pass
    ports:
      - "5432:5432"
    volumes:
      - postgres_data:/var/lib/postgresql/data
  
  redis:
    image: redis:7-alpine
    ports:
      - "6379:6379"
    command: redis-server --appendonly yes
    volumes:
      - redis_data:/data

volumes:
  postgres_data:
  redis_data:

MVP Deployment

Frontend: Vercel (Next.js)
Backend: Railway.app
Database: Supabase PostgreSQL
Cache: Upstash Redis
Cost: ~$50-100/month

Scale Phase

Frontend: Vercel Pro
Backend: AWS ECS
Database: RDS PostgreSQL
Cache: ElastiCache
Cost: ~$500-1500/month

Enterprise

Frontend: CDN + ECS
Backend: Multi-region ECS
Database: Aurora PostgreSQL
Cache: Redis Cluster
Cost: $2000-5000/month

Cannabis-Specific Deployment Considerations

Hosting Restrictions:
  • • Some cloud providers restrict cannabis businesses
  • • AWS/GCP generally allow cannabis tech companies
  • • Avoid shared hosting or platforms with strict content policies
  • • Ensure terms of service explicitly allow cannabis tech
Compliance Requirements:
  • • Data residency requirements (some states require in-state hosting)
  • • Audit trail retention (7+ years for some jurisdictions)
  • • Backup and disaster recovery mandatory
  • • Real-time monitoring for compliance alerts

Deployment Timeline & Costs

7. Performance Optimization

Database Optimization

-- TimescaleDB Performance Optimizations
-- 1. Hypertable configuration for inventory data
SELECT create_hypertable(
    'inventory_snapshots', 
    'recorded_at',
    chunk_time_interval => INTERVAL '1 day',
    create_default_indexes => TRUE
);

-- 2. Compression for old data (saves 83% storage)
ALTER TABLE inventory_snapshots SET (
    timescaledb.compress,
    timescaledb.compress_segmentby = 'product_id'
);

SELECT add_compression_policy('inventory_snapshots', INTERVAL '7 days');

-- 3. Optimized indexes for cannabis queries
CREATE INDEX CONCURRENTLY idx_inventory_product_time 
ON inventory_snapshots (product_id, recorded_at DESC);

CREATE INDEX CONCURRENTLY idx_products_strain_category 
ON products (strain_type, category) 
WHERE is_active = true;

-- 4. Materialized views for dashboard queries
CREATE MATERIALIZED VIEW daily_sales_summary AS
SELECT 
    DATE(sold_at) as sales_date,
    product_id,
    SUM(quantity_sold) as total_quantity,
    SUM(total_amount) as total_revenue,
    COUNT(*) as transaction_count
FROM sales_transactions 
WHERE sold_at >= CURRENT_DATE - INTERVAL '90 days'
GROUP BY DATE(sold_at), product_id;

CREATE UNIQUE INDEX ON daily_sales_summary (sales_date, product_id);

-- Refresh strategy
CREATE OR REPLACE FUNCTION refresh_daily_sales_summary()
RETURNS void AS $$
BEGIN
    REFRESH MATERIALIZED VIEW CONCURRENTLY daily_sales_summary;
END;
$$ LANGUAGE plpgsql;

-- 5. Partitioning for compliance logs
CREATE TABLE audit_logs (
    id UUID DEFAULT gen_random_uuid(),
    organization_id UUID NOT NULL,
    event_type VARCHAR(100),
    created_at TIMESTAMP NOT NULL DEFAULT NOW(),
    details JSONB
) PARTITION BY RANGE (created_at);

-- Create monthly partitions
CREATE TABLE audit_logs_2025_01 PARTITION OF audit_logs
FOR VALUES FROM ('2025-01-01') TO ('2025-02-01');

Redis Caching Strategy

import redis
import json
import asyncio
from typing import Optional, Any
from datetime import timedelta

class CacheManager:
    def __init__(self, redis_client: redis.Redis):
        self.redis = redis_client
        
    async def get_cached_forecast(self, product_id: str) -> Optional[dict]:
        """Get cached demand forecast"""
        key = f"forecast:{product_id}"
        cached = await self.redis.get(key)
        if cached:
            return json.loads(cached)
        return None
    
    async def cache_forecast(self, product_id: str, forecast: dict, ttl: int = 3600):
        """Cache demand forecast for 1 hour"""
        key = f"forecast:{product_id}"
        await self.redis.setex(key, ttl, json.dumps(forecast))
    
    async def get_competitor_prices(self, category: str) -> Optional[list]:
        """Get cached competitor prices"""
        key = f"competitor_prices:{category}"
        cached = await self.redis.get(key)
        if cached:
            return json.loads(cached)
        return None
    
    async def cache_competitor_prices(self, category: str, prices: list):
        """Cache competitor prices for 15 minutes"""
        key = f"competitor_prices:{category}"
        await self.redis.setex(key, 900, json.dumps(prices))
    
    async def invalidate_product_cache(self, product_id: str):
        """Invalidate all caches related to a product"""
        patterns = [
            f"forecast:{product_id}",
            f"inventory:{product_id}",
            f"pricing:{product_id}"
        ]
        
        for pattern in patterns:
            await self.redis.delete(pattern)

# FastAPI with caching middleware
from fastapi import FastAPI, Depends
from functools import wraps

def cache_response(ttl: int = 300):
    """Cache FastAPI endpoint responses"""
    def decorator(func):
        @wraps(func)
        async def wrapper(*args, **kwargs):
            # Generate cache key from endpoint and parameters
            cache_key = f"endpoint:{func.__name__}:{hash(str(kwargs))}"
            
            # Try to get from cache
            cached = await cache_manager.redis.get(cache_key)
            if cached:
                return json.loads(cached)
            
            # Execute function and cache result
            result = await func(*args, **kwargs)
            await cache_manager.redis.setex(
                cache_key, ttl, json.dumps(result)
            )
            
            return result
        return wrapper
    return decorator

@app.get("/api/v1/dashboard/metrics")
@cache_response(ttl=300)  # Cache for 5 minutes
async def get_dashboard_metrics(org_id: str):
    # Expensive dashboard query
    return await calculate_dashboard_metrics(org_id)

API Performance Monitoring

import time
import logging
from fastapi import Request, Response
from starlette.middleware.base import BaseHTTPMiddleware

class PerformanceMiddleware(BaseHTTPMiddleware):
    async def dispatch(self, request: Request, call_next):
        start_time = time.time()
        
        # Add request ID for tracing
        request_id = f"req_{int(time.time() * 1000)}"
        request.state.request_id = request_id
        
        response = await call_next(request)
        
        # Calculate response time
        process_time = time.time() - start_time
        response.headers["X-Process-Time"] = str(process_time)
        response.headers["X-Request-ID"] = request_id
        
        # Log slow requests
        if process_time > 2.0:  # Log requests > 2 seconds
            logging.warning(
                f"Slow request: {request.method} {request.url.path} "
                f"took {process_time:.2f}s"
            )
        
        # Metrics collection
        await self.record_metrics(request, response, process_time)
        
        return response
    
    async def record_metrics(self, request: Request, response: Response, duration: float):
        """Record metrics for monitoring"""
        metrics = {
            "method": request.method,
            "path": request.url.path,
            "status_code": response.status_code,
            "duration": duration,
            "timestamp": time.time()
        }
        
        # Send to your metrics collection system
        # (DataDog, CloudWatch, Prometheus, etc.)
        await send_to_metrics_system(metrics)

ML Model Optimization

import asyncio
import joblib
from typing import Dict, List
import numpy as np

class ModelCache:
    def __init__(self):
        self.models = {}
        self.model_lock = asyncio.Lock()
    
    async def get_or_train_model(self, product_id: str) -> Any:
        """Get cached model or train new one"""
        async with self.model_lock:
            if product_id not in self.models:
                self.models[product_id] = await self.train_model(product_id)
            return self.models[product_id]
    
    async def batch_forecast(self, product_ids: List[str]) -> Dict[str, Any]:
        """Batch forecasting for better performance"""
        tasks = []
        for product_id in product_ids:
            task = self.get_forecast(product_id)
            tasks.append(task)
        
        results = await asyncio.gather(*tasks)
        return dict(zip(product_ids, results))

class OptimizedForecaster:
    def __init__(self):
        self.model_cache = ModelCache()
        
    async def bulk_forecast_update(self, organization_id: str):
        """Update forecasts for all products in batch"""
        # Get all active products
        products = await self.get_active_products(organization_id)
        
        # Process in batches of 10 to avoid memory issues
        batch_size = 10
        for i in range(0, len(products), batch_size):
            batch = products[i:i + batch_size]
            
            # Parallel processing within batch
            tasks = [
                self.update_single_forecast(product['id']) 
                for product in batch
            ]
            
            await asyncio.gather(*tasks)
            
            # Small delay to prevent overwhelming the system
            await asyncio.sleep(0.1)
    
    async def smart_forecast_scheduling(self):
        """Intelligent forecast scheduling based on data freshness"""
        # Priority 1: Products with recent sales (daily updates)
        high_priority = await self.get_high_velocity_products()
        
        # Priority 2: Regular products (weekly updates)
        medium_priority = await self.get_regular_products()
        
        # Priority 3: Slow movers (monthly updates)
        low_priority = await self.get_slow_moving_products()
        
        # Schedule accordingly
        await self.schedule_forecasts(high_priority, interval_hours=24)
        await self.schedule_forecasts(medium_priority, interval_hours=168)
        await self.schedule_forecasts(low_priority, interval_hours=720)

Performance Targets

<200ms
API Response Time (95th percentile)
99.9%
Uptime SLA
<5min
Forecast Generation
<1sec
Dashboard Load Time

8. Implementation Timeline & Milestones

Phase 1: MVP (Months 1-4)

Month 1-2: Foundation

  • • Set up development environment
  • • Implement core database schema
  • • Build authentication system
  • • Create basic FastAPI structure
  • • Set up Next.js frontend

Month 2-3: Core Features

  • • Implement Dutchie POS integration
  • • Build basic inventory tracking
  • • Create Prophet forecasting engine
  • • Develop compliance dashboard
  • • Add Metrc API integration

Month 3-4: Beta Launch

  • • Complete user interface
  • • Implement alert system
  • • Add basic reporting
  • • Deploy to production
  • • Onboard 5 beta customers
Success Metrics: 5 paying beta customers, 80%+ forecast accuracy, working Metrc integration

Phase 2: Feature Expansion (Months 5-8)

Month 5-6: Loyalty & CRM

  • • Customer database integration
  • • Segmentation algorithms
  • • SMS/Email campaign system
  • • Loyalty points tracking
  • • Churn prediction models

Month 7-8: Dynamic Pricing

  • • Competitor price monitoring
  • • Dynamic pricing algorithms
  • • Margin protection rules
  • • A/B testing framework
  • • Revenue optimization dashboard
Success Metrics: 20 paying customers, all 4 modules active, $50K+ MRR

Phase 3: Scale & Optimize (Months 9-12)

Month 9-10: Performance

  • • Implement caching layers
  • • Optimize database queries
  • • Add monitoring & alerting
  • • Scale infrastructure
  • • Mobile app development

Month 10-11: Advanced Features

  • • Multi-location support
  • • Advanced analytics
  • • API for third-party integrations
  • • White-label options
  • • Enterprise security features

Month 11-12: Market Ready

  • • SOC 2 compliance
  • • Complete documentation
  • • Sales team onboarding
  • • Marketing automation
  • • Fundraising preparation
Success Metrics: 100+ customers, $200K+ MRR, enterprise-ready platform

Revenue Growth Projection

Final Recommendations & Next Steps

Why This Stack Wins

  • Proven at Scale: FastAPI + Next.js powers unicorn SaaS companies
  • Cannabis-Optimized: TimescaleDB perfect for inventory time-series data
  • AI-First: Python ecosystem ideal for Prophet/ML integration
  • Compliance-Ready: Built-in audit trails and encryption
  • Cost-Effective: Start at $50/month, scale to millions

Immediate Action Items

1
This Week: Interview 5 dispensary owners to validate MVP features
2
Week 2: Set up development environment (Next.js + FastAPI)
3
Week 3-4: Apply for Metrc API access (3-4 week approval time)
4
Month 2: Build MVP with inventory + compliance modules

Path to $10M ARR

Year 1
$336K ARR
20 customers
Year 2
$2.24M ARR
110 customers
Year 3
$8.66M ARR
380 customers
Exit
$50M+ Valuation
5-10x revenue multiple

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