Running a successful cannabis business comes with its own set of hurdles, but it also has juicy rewards.
The legal cannabis market is growing at an alarming rate.
With most U.S. states and all of Canada allowing cannabis use, the growth has been exponential. But this brings quite a few challenges for retailers, growers, and other businesses operating within the cannabis industry.
Running a cannabis business isn’t too different from any other business, but there are some particularities and helpful tips to consider.
As mentioned, it’s a challenging task to run a dispensary, but it’s more than possible with the right advice.
Location is everything. If you want a successful cannabis business, you must be extremely careful about where you want it. But it’s not just the specific location. You should consider several points regarding the actual place.
Consider the neighborhood in general; what will surround your cannabis store? Try opting for a safe and busy place; the more people pass by, the higher the chances they will enter.
Easy access is part of the above, meaning it’s an easy location for consumers to stop by. Also, think about how the store looks and what decor to use. Determine the style of your dispensary and apply it to everything, and we mean EVERYTHING, from packaging and store decor to Instagram images.
Consider the local demographics, what the local population is like, and their opinion on cannabis. We’ll talk about legal issues later, but they also come into play here. Always ensure you are located in an area where the sale of cannabis is allowed and complies with local regulations.
In conclusion, location is one determining factor for a business’s success, which extends to those in the cannabis business. However, your location is immovable if your dispensary is already in operation. But you can still optimize how your location looks and make it welcoming to prompt returning customers.
Competition in the cannabis industry can be fierce. Having good suppliers and wholesalers on your side will undoubtedly give you an advantage. Finding the right partnerships is vital if your dispensary hopes to thrive.
Seeking partnerships with local suppliers and growers will be an excellent strategy for cannabis businesses. You will eventually be able to get reasonable prices, and quality products, and your dispensary will be recognized for your community support. It’s a win-win by any measure.
Also, getting involved with the community and advocating for its continuous improvement can bring even more benefits. In the area where your dispensary is situated, you can choose to do social campaigns beyond just selling and selling; consumers want products, of course, but generating meaningful relationships with the community is an excellent strategy.
By actively engaging your community, you will not only boost your brand’s awareness, but more of your customers will have positive long-term associations with your business, improving their brand loyalty over time. It will also diminish negative stereotypes of cannabis that may be present in your community.
What would motivate consumers to go to another if all dispensaries were the same? Differentiation is the key to success. Being different is what attracts consumers.
Differentiation encompasses many aspects. From the products, you offer to the prices you charge, the tone of your brand, your values, and the way you connect with consumers. This is the DNA of your cannabis store, and it’s what makes you unique.
Differentiating the store from its aesthetics is important, but it’s much more than the look. The entire experience includes how your budtenders interact with customers and how your dispensary makes consumers feel.
Herb’s Tip: Offer customers what they can’t get from your competition. This can be accomplished in various ways, from getting exclusivity on certain products, developing unique products, or simply being known as a “friendly” dispensary. Creativity is the basis of everything.
Law compliance is essential if you want to run a successful cannabis store or dispensary. And this can be challenging when regulations change from place to place and moment to moment.
Under federal law, cannabis is still illegal. For this reason, each pro-marijuana state has its own different laws governing the operation of cannabis dispensaries.
It’s important to know the regulations of the physical location where your cannabis dispensary or store will operate, as the regulations govern issues such as:
The key to success is to stay one step ahead of the regulations, always opt for the most restrictive measure, and you’ll be confident in your compliance. A complete understanding of state, federal, and local laws is critical to running a successful dispensary.
Another critical factor is defining your brand’s voice and having everything in that tone. From store displays and social media captions to how your team treats customers, this standardizes your cannabis business.
In general, cannabis stores should focus on creating a welcoming atmosphere that invites customers to return. A few aspects that are quite attractive in the eyes of a consumer include:
Think of your store or dispensary as any other business. Establish measurable and quantifiable goals and timetables for meeting objectives, assign responsibilities, and manage inventories in an optimized way.
A fundamental part of a successful dispensary is making itself known. The best way to do that is solid marketing, but this comes with its own set of hurdles.
Not all social networks and search engines are fans of cannabis, and in their own regulations, there are quite a few limitations on advertising weed. But don’t be discouraged; it can be done.
Having a good digital marketing plan is vital for the business to grow organically and reach potential customers. For this, you will have to consider issues such as cannabis SEO, technical and local SEO, email and text message marketing, what types of products you want to market, and many more.
At this point, having a specialized marketing team can make all the difference.
Employing automated information programs may be ideal for customers who aren’t fans of getting a lecture from their budtenders, plus it will take pressure off your team’s shoulders. Having the technological means to help share useful information is of great value.
Think to educate first, influence second, and sell last. Easier said than done, but it will pay off. Combining technology with human resources can make things a lot easier.
We suggest investing in, implementing, or fully utilizing digital systems that help you manage your dispensary and client list.
Through different tactics, you can seek to capture information about your visitors/customers: names, emails, social media profiles, product preferences, birthdays, and more. This lets you leverage customer individualization to send personalized alerts about your products or on special dates, making them feel special to your dispensary.
Using automated systems to take orders from a customer online, on a mobile device before they arrive, or while they are browsing will be a big plus. Running a successful dispensary requires investing in a data processing system that is secure, reliable, and optimal.
Running a cannabis dispensary is similar to running any other business, but it has its own unique challenges.
Overcoming these challenges is not impossible; it is a matter of organization and having a team to support your business. The first thing is to overcome the legal difficulties of our industry, then focus on giving your customers the best possible experience.
These are just some of the most important aspects of running a cannabis business. Still, you can’t forget aspects such as finance, security, personnel management, licensing requirements, product sourcing, etc.
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