6 Myths Debunked About Running a Successful Cannabis Dispensary
Believe these lies at your own peril.
The cannabis retail landscape has changed drastically in recent years, mostly to the benefit of customers. For this reason, many entrepreneurs are thinking about investing in or launching a cannabis dispensary.
I've learned a thing or two about what it takes to find success as the co-founder of Burb. From one entrepreneur to the next, I'd like to dispel some common myths about the retail space that will, hopefully, point you in the right direction with your endeavors.
Myth #1: Staffing won't be an issue, because everybody wants to work in cannabis.
The truth: People are leaving their jobs across every industry, including cannabis, in search of more money, more flexibility, and more happiness. My advice is to make the team your number one priority and keep them happy. Turnover is really pricey and it messes with customer service. This is a people-first industry and that goes beyond pleasing customers.
Myth #2: You need to hire "traditional retail professionals" as opposed to "stoners" to be successful.
The truth: We work with a lot of amazing people whose lifestyle involves smoking weed every day. In my experience, they're some of the most brilliant team members and are passionate about the product. My main criteria is hiring unique and personable people, who are high-functioning. Most of Burb's staff falls under this category. When you're hiring, don't discriminate against the people who built this beautiful industry. Embrace and empower them.
Myth #3 When you're opening a store, the cost to build it out and acquire inventory is what you should prepare for.
The truth: Two words – holding costs. Don't assume that you only need money for a store build out and inventory. You also need money to sit on a lease for up to two years, depending on the state of legalization and license allocation. Basically, be prepared to light money on fire in this business for long-term results, i.e., holding costs. You'll be dealing with municipalities, the city's regulations, and local politics. That all equates to planning for a bigger budget than what you think it would cost to start a store.
Myth #4: If you build it, they will come
The truth: Retail is a very competitive environment, so anything you can do that creates a brand around the store will help. Whether that's product, white labeling your store brand, or through the design of the shop, you want to build loyalty for people to come into your store. That starts with your brand and your people. Even though you may sell some variation of the same things as the dispensary down the street, it's important to think about long-term brand, versus short-term process, because it's a long game. Cannabis retail is not fast money. There are going to be competitors down the street at some point, eventually.
Myth #5: Store location isn't that important, customers will make the trip
The truth: As is anything to do with retail, the biggest thing is finding the right location. The majority of customers won't drive out of their way to get to your business. Remember, you're still offering convenient service at the end of the day. Your business will be better off finding a high-traffic location that ensures consistent foot traffic in both the peak and slow seasons.
Myth #6: Cannabis stores aren't a regular retail business.
The truth: Actually, they are, and in 2022 you have to be on it with marketing and promotions to entice customers to come back, just like any other retail business. Once your stores are up in running and you've gotten through the early launch phase, you'll find yourself hoping for repeat customers. To get that, guerrilla marketing in your local community, offering in-store specials from the get-go, discounts, and establishing loyalty programs will make a big impact. Also, anytime you can go direct-to-consumer, you will win. Think digital! That means, if you have an app or text message marketing campaign, do it. You want to be talking to your customers and giving them as much value as possible - in return they will give you insights and data.