420 is arguably the most important day in the Cannabis industry and it is critical for businesses to prepare and ensure they are taking advantage of customer traffic increases.
It’s about to be the most wonderful time of year for the Cannabis Industry, for consumers that is. April 20th is quickly approaching and as a business owner, it can get a little stressful, especially given the current state of the industry given the concerns surrounding the COVID-19 outbreak. Here are some things to prepare for to ensure that you are making the most out of your favorite holiday.
Make sure you have enough product in stock
This is a little harder than it sounds, so relying on historical data for demand forecasting will make things easier. This concept looks at not only sales from the previous weeks of the current year, but also looks at last year’s data to be layered on top to generate a forecast. Traditional retail outlets and ecommerce marketplaces implement a concept called Back 4/ Forward 8. They look at the last 4 weeks of sales from the current year to identify hot products, then they look at last year’s sales forward 8 weeks from the current date to anticipate how much they need to order. These timeframes for forecasting are good recommendations, but could change based on vendor lead times and current stock on hand, especially if your current inventory has recently taken a large hit from panic buying.
Determine Discounts to Run/ Loss Leaders
One of the best things about 420 for a consumer is all of the amazing specials and discounts offered throughout the day and even leading up to it. As a business, you want to make sure you are offering discounts that optimize both volume and margin. Loss leaders have become a popular concept where businesses intentionally sell a product at a loss in order to drive customer volume. The hope is that attracting customers with loss leaders leads to overall higher margins due to additional spend on complementary higher margin products.
You’ll want to establish some specials so that you can keep a competitive edge. Relying on historical data to see what’s trending in your dispensary can help brainstorm some creative specials that will drive consumers.
Market your promotions ahead of time through multiple channels (text, email, website, social). The many CRM tools within the industry can be a helpful tool to maximize traffic and advertise specials. Here are a few tools we recommend to help maximize your efforts:
DataOwl, SpringBig & Cannalytics.
Train Employees a/o Knowledgeable Staff
Like any business, it’s important to establish a solid staff that represents your brand and company. These are the people who communicate with your customers on a daily basis, so it’s crucial that they are knowledgeable about your products, pricing and any specials. Additional training before 420 can help streamline any issues that may arise on that day and ensure that consumers get their product in a timely manner.
Product knowledge will be one of the most important things for your budtenders. The more knowledgeable the budtender, the higher chance of sales and customer retention. Try to schedule your most knowledgeable and experienced staff members for your busiest time of day. You will want to provide detailed descriptions of every product within your dispensary, but also train them on proper dosing, cannabinoids and terpenes. This is especially important during the Covid-19 epidemic where many cities are requiring social distancing measures for dispensaries. This could include limiting customers inside at one time, sales outside the shop, and call ahead/delivery purchasing. Make sure all of your employees understand not only your corporate policies concerning these issues but also any regulations that may have been imposed by your local government.
Dial in Security
Given the increased volume of customers that will be visiting your store on 420 and the days leading up to it, there is an increased need to protect your products, employees and customers. If you plan on hiring physical guards you should begin making those plans now as waiting until the week before could mean that you have to pay a premium or worse no guards could be available.
While guards are certainly a deterrent to theft and can also help manage the flow of people in and out of your business, they can’t watch everything all the time. This is where technology can play a pivotal role. Consider investing in solutions like a camera monitoring system to assist in seeing things guards can’t. Remember that on such a busy day there may be parts of your dispensary that normally aren’t high traffic areas that become clustered. With camera monitoring you will be able to see much more activity in all areas of the store. To take it a step further you can even get a company to monitor your cameras remotely 24 hours a day so your business is safe even when no one is present.
Have Reliable Software
Having a packed dispensary on 420 is great, but only if you can sell your patrons what they came to buy. Due to increased demand on the system it is possible for your point-of-sale system to crash, especially if you based your decision for one based on the lowest cost. Being unable to perform basic sales functions due to a downed system can have an impact far beyond just 420. Dissatisfied customers are likely not going to return to your store, and could potentially leave negative reviews that may impact your reputation far beyond repair. Here are some things you can do to help make the checkout process run smoothly on 420.
- Load test your current software
- Have the point-of-sale support phone number readily available
- Plan workflows ahead of time anticipating increased volume
- Pre-program discounts and loyalty to limit time spent ringing up sales
420 can be an incredible day for dispensaries and customers alike. Making sure you plan ahead vastly improves your chances of keeping lines moving and customers happy. It’s important to keep in mind that even with the most well thought out plans, unforeseen incidents can occur. Do what you can to mitigate the situation as much as possible and try not to let things beyond your control set the tone for the day. Follow these tips and 420 will be as successful as it can be!