Welcome to our second-annual tips issue, where we close out the year sharing dozens of strategies to help you improve your business. In this issue, you’ll find insights from experts on topics such as expanding and franchising your business, evaluating a potential acquisition and attracting more Gen X customers.
Though the article topics are varied, a strong theme persists throughout the issue—the importance of treating employees well and fairly. Showing staff you appreciate what they do, especially around the holidays, with spoken words and written thank-you notes is important. It matters, it costs nothing and takes little time. However, actions tend to speak louder than words, and to be competitive in this job market, companies need to do more year-round.
Human resources expert and regular HRHQ columnist Maria Denzin didn’t just write about ideas for keeping associates happy for this month’s issue. Her tips revolve around making sure another dispensary doesn’t scoop up your staff. Poaching is a business reality in a job-seeker’s market, and one of the main reasons people leave their jobs is money. Retailers can’t just pay the market rate to keep great employees. They must do better.
This sentiment was echoed by Bianca Blanche, a flower host with Original Cannabis Café (formerly Lowell Café,) a cannabis consumption restaurant in Los Angeles. Blanche notes, “By compensating budtenders properly, it tells them you care about their well-being and want to see them succeed. A happy budtender equals a happy customer.” Most of us know this, but not all have internalized it, as some budtenders in even expensive markets like L.A. don’t make a living wage.
Dockside Cannabis, featured in this issue’s cover story, also works to ensure budtenders—who Dockside co-founder Aaron Varney says are the “face of the company”—are making competitive wages, both regionally and nationally.
Benefits are important, but as Denzin notes, they must cater to what really matters to your employees. Vacation time is more important to some than a 401K. Others value a work-life balance or trust and flexibility, where time-off requests aren’t met with resistance or aversion. Discovering what each person on your team wants and customizing benefits when possible demonstrates how valuable they are to your operation.
These strategies not only benefit your employees, but they benefit your business. “The cost of replacing an individual employee can range from one-half to two times the employee’s annual salary—and that’s a conservative estimate,” according to a 2019 Gallup report. “A trillion dollars. That’s what U.S. businesses are losing every year due to voluntary turnover.”
What’s perhaps more important is that in many cases, employee turnover can be avoided by working to keep your employees happy. “The most astounding part is that most of this damage is self-inflicted,” reports Gallup.
Whether you’re looking to create a better workplace for your employees and prevent talented employees from leaving the company or make important decisions about expansion or marketing, this issue of CD is designed to help you close out 2019 with implementable strategies for the coming year.
Best wishes for continued success and a healthy and happy holiday season!
In the world of legal cannabis, exit packaging is a necessary evil. Despite a recent study in JAMA, the Journal of the American Medical Association, that shows teen cannabis use in states with legal markets is declining, grandma’s secret stash of gummies may remain rather appealing to an unsuspecting toddler who stumbles upon them.
Of course, other considerations factor into selecting the best exit packaging for your dispensary besides “child-proofing,” decisions that affect both the short-term and long-term costs associated with rampant plastic production or, simply, reliability. Here are four things to consider when searching for exit packaging options:
1. Does the packaging company understand your market’s regulations? The first step in selecting the right packaging for your needs is to ensure compliance.
For example, in Oregon, the law defines compliant packaging as “a container or exit package that is resealable and continually child-resistant as certified by a qualified third-party child-resistant package testing firm.” While most packaging companies aim to provide product to as many markets as possible, laws vary by state, and it is important to check with your local governing body to determine what types of closures are acceptable.
2. Will the closure work for everyone? There are plenty of closure types that will keep children from accessing product, but it’s also important to consider the people who may struggle with those same protections because of symptomatic concerns, such as arthritis.
Push-and-twist models that require two hands (common in pharmaceuticals) can be tricky, especially when sourced cheaply. Pop-tops can be easier for customers and staff, as they also make for faster prep behind the counter and prevent runaway lids. Pop-tops’ material, however, is more pliable and can be difficult to replicate using recycled sources or bioplastics, according to Justise Grider-Brown, operations manager at P3, a Portland, Ore., distribution company.
3. Is the packaging made from sustainable materials? Legalization certainly opens up access to safer products, but the strict regulations governing sales leave in their wake a tremendous amount of waste that those children we’re supposed to be protecting will have to clean up one day.
To get ahead of that problem, certain packaging manufacturers now turn to bioplastics as the primary material for their exit bags, in some cases, using renewable, plant-based materials. If this is a priority for your company, explore your options fully.
4. Does the packaging’s cost make sense? China supplies cheap packaging options for dispensaries in the U.S. But according to Farma’s Michael McGuire, reliable availability can be an issue—especially around Chinese New Year celebrations when factories close for up to a month.
While U.S.-made and/or sustainable packaging may have a less competitive price tag up front, the long-term reward may be worth it. And, if your budget isn’t quite ready for biodegradable plant-based plastics, consider implementing an incentive program for customers who return or reuse packaging. It’s a strategy that can help you win repeat business and set an ethical standard for the entire cannabis industry.
Andrea Sparr-Jaswa is the director of education and outreach at Farma in Portland, Ore., where she is responsible for aggregating and analyzing customer-facing data.
For most of their lives, baby boomers were the largest generation in U.S. history.
Though they’ve been eclipsed by millennials, they still comprise nearly 25% of the nation’s population—and a big segment of a dispensary’s potential customer base.
Born between 1946 and 1964 and weaned on Woodstock and Watergate, boomers turn 55 to 73 years old in 2019. Depending on a person’s perspective, that may sound ancient or young and may influence whether dispensary sales are lost or won.
The following insights shine a light on common misconceptions about boomers and what makes them unique. Understanding this demographic can help dispensaries provide the service and products boomers have come to expect.
1. Boomers aren’t disinterested bystanders.
Jennifer Culpepper, founder and creative director of cannabis branding agency Brand Joint, believes that baby boomers are one of the industry’s most underserved markets. “Sometimes people assume that because someone is older they’re not going to be interested in cannabis,” Culpepper says. “They actually seem to be among the most interested because they’re facing different ailments that cannabis can really help.”
Consumer behavior in fully legal states provides a glimpse into boomer attitudes. Jessica Lukas, vice president of consumer insights for BDS Analytics, a cannabis market intelligence and consumer research company, puts it in perspective: 30% of cannabis consumers in fully legal states are 55 or older.
People in this age group are likely drawn to cannabis because they believe it offers health and wellness benefits, Lukas says. According to BDS research, 90% of boomers who consume cannabis believe it relieves pain, and another 90% strongly believe it has medical benefits. Boomers also have a highly favorable opinion of cannabis if it can help a sick loved one, with 97% supporting its use in such cases.
2. Boomers consume for more than aches and pains.
Belief in cannabis health benefits doesn’t mean that pleasure takes a back seat. While 64% of cannabis-consuming boomers consume for health or medical reasons, 60% also purchase it for recreational and social benefits, Lukas says.
In addition, boomers are less likely than younger consumers to use or prefer inhalables but still use them. “It actually starts in the data to look a little bit like a nostalgic form of consumption,” Lukas explains.
Edibles and topicals are boomer go-tos when it comes to relieving pain, improving sleep or avoiding prescription medications. But they prefer inhalables for recreational and social use, Lukas says. “And boomers, more so than other generations, are willing to tell us they consume inhalables to have fun, be happy and get high or stoned,” she adds.
3. Boomers expect personalized, professional, trustworthy service.
Boomers grew up being catered to, earning them the nickname the "me generation.” They expect sellers to understand. Jennifer McLaughlin, vice president of merchandising for multistate cannabis operator Calyx Peak Companies, speaks from 20 years of retail experience as an apparel executive. “Customer service is everything to the baby boomer. They grew up in brick and mortar,” she explains.
“Hands-on communication and interaction with people working in dispensaries is mission critical. Boomers need to be able to ask questions and get the help that they want,” McLaughlin says. She suggests creating an inviting, inclusive, customized dispensary experience where customers can sit with budtenders one-on-one.
BDS research shows the No. 1 driver for how boomers choose their dispensary is a trustworthy and professional staff. “Those two things trump price and they trump location for this group of consumers,” Lukas says. “They’re willing to drive out of the way to go to a place that offers them that … trusted experience.”
“Sometimes people assume that because someone is older they’re not going to be interested in cannabis. They actually seem to be among the most interested because they’re facing different ailments that cannabis can really help.” Jennifer Culpepper, founder and creative director, Brand Joint
4. Boomers look to the cannabis industry to educate them.
“In trying to market to boomers, education is probably going to be one of your best tools,” Culpepper says. “They’re familiar with cannabis in another generation of it, so many aren’t familiar with all the new ways of consumption and new types of products.”
Barriers, such as getting a medical card, amplify the importance of educating boomers via electronic avenues. “They are responsive to email, and they are on Facebook, too,” Culpepper explains. Education-related social media can be valuable when targeting this group.
For boomers who shop dispensaries, 60% name budtenders as their main information source, according to BDS. Also, 40% rely on cannabis websites, and 25% read cannabis-related publications to obtain information. “Boomers are more likely to get info from these sources than by talking with a doctor or going to health publications or websites,” Lukas shares.
McLaughlin emphasizes the power of engaging with boomers one-on-one, asking if it’s their first visit or how they’re feeling about the experience. This gives them the OK to seek answers and education they need. “When a customer gets confused, they freeze. They don’t buy,” she says. “That’s pretty important as it relates to this generation.”
5. Boomer consumption preferences offer sales opportunities.
Nearly half of boomers prefer inhalables, while 31% prefer edibles and 20% indicate topicals are their preferred consumption methods, according to BDS data. But a substantial amount of cross consumption occurs. For example, among boomers who prefer inhalables, 35% still consume edibles, and 16% use topicals. That presents a big opportunity to upsell.
Not everyone is open to trying different product forms, but numbers suggest vape-loving boomers may go for edibles and topicals, too—if dispensaries elevate service and sales pitches to explain how an edible or topical, for example, might complement a boomer’s vape use.
“Educating consumers on product forms and methods and how they can be used together is a great way to see growth in a single store, among your current shopper base,” Lukas says.
Stay tuned for part two of this series, which will take a closer look at Generation X.
I was at the checkout counter in an independent hardware store a few weeks ago, and right in front of me was a power tool on sale for just under $50. During another outing at a wine shop a few weeks later, I saw three different $30 Syrah wines on the counter with a sign that read “Try something new.”
“Geez,” I thought, “how many retailers just don’t understand the dynamics of a customer standing at their retail counter?”
Once a customer has ticked off the end of his or her shopping list or the poorly trained employee has said, “Anything else?” the customer is outta there. Customers at the register are not there to browse, not there to have to make a choice and not there to do anything other than pay for their merchandise and get on with their lives.
While true that a counter display that is part of your overall visual merchandising strategy can interrupt that routine and get them to buy—boosting your average check and number of items sold—it must be done thoughtfully. Here are seven tips on creating a good point-of-purchase display that can help build brand awareness, drive more incremental sales and boost profitability.
1. Display one product. You want to get the customer focused on one item. Use point-of-sale data to find a best- selling product customers are already familiar with. The lack of choice makes it an easy yes or no decision for the customer.
2. The featured product should be something everyone can use. The universality of it makes it easy for all customers to just throw it on their tab.
3. Keep the price point less than $20—below $10 is even better. Most customers can drop a $10 bill without noticing. And if you can’t feature product in your store due to state regulations, you can still fill an empty wrapper or bag with stuffing so it looks like the product. (Editor’s note: Some examples may include branded rolling papers or lighters, pre-rolls or grinders.)
4. Establish profit margins that cover shrinkage. If the items can be easily pocketed when a cashier is swamped, like rolling papers or lighters, you need margins to cover those thefts.
5. Keep the counter displays fresh, and change them weekly. Timing is everything, so put your seasonal merchandise out early and sell through it before using a regularly stocked item.
6. Keep the signage short and to the point. It should take no more than seven words to grab a customer’s interest. Like all signs, your goal is to paint a picture. “Almonds make a great afternoon snack!” will tempt someone to purchase them much more than a sign that just reads “2 for $5.”
7. It’s not a clearance aisle. If you are trying to move slow-selling items, the counter is not the place. There’s a reason they didn’t sell in the first place. Stick to displaying items that constantly move.
Bob Phibbs launched The Retail Doctor in 1994. He is an internationally recognized business strategist, customer service expert, sales coach, marketing mentor, author of three books and motivational business speaker.
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