With a saturated cannabis market here in Oklahoma, it’s important to understand not only basic economics but also how your product or service fits or outshines. At the date of this writing, we have over 6,800 licensed growers serving a medicinal market that makes up about 10% of the state’s population (aka Med-Rec with the ease of getting a medical card). That number would still be considered high even if it were serving the 4 million residents (and those traveling in) had the vote gone recreational. Obviously, had our vote gone recreational, it would have “bailed” out thousands of
businesses that are fighting for survival. Add the fact that we have 1,800+ processors and we all get the picture … there’s no green rush! That ship has sailed for the foreseeable future which means those that are here for the long haul have to continue finding ways to improve and diversify to remain.
Specific to the wholesale vendors, how do your businesses do more than survive in such a flooded marketplace? I believe it takes a plethora of angles to do more than make ends meet. First, I believe you have to truly have a passion for what you’re producing and selling. Sounds like a no-brainer but like any other business or product, there has to be a rooted passion for what you’re doing to truly excel but even more critical in a market that has nearly 10,000 different businesses competing for consolidating dispensary shelf space. So, whether you’re here producing flower, carts, edibles, topicals, tinctures, etc., you first have to be all-in with your work ethic and passion for setting you and your business apart!
Next, you have to determine how you’re setting yourself apart from the parking lot full of vendors vying for dispensary and patient need and desire. Flower makes up a majority of sales, especially if you consider pre-rolls which are followed by carts, edibles, concentrates and then to the even tighter market of the variety of products that make up the remaining 5% of sales. If you’re diversified in the space, it could certainly help if you’re standing out in a few different product categories. With so many options for patients and dispensaries to choose from, what makes your product or service stand above the rest? Is it a unique or sought after product or strain? Is it backed with product guarantees to the dispensary and patient? Is it professionally packaged and distributed properly? Is it consistent quality? With the state of the market, it really needs to be all the above!
So, how do you even make it in the door? One of the first wins in business is being “first to market”. For those that’ve been here since inception or have expanded from other states, they will have a much higher success rate than those just entering the market. Dispensaries and patients have had years to become familiar with and trust the quality and consistency of the vendors that have established themselves. For the thousands that have come in over the last year or two, it’s about all of the aforementioned and the value add of being professional and consistent in your sales approach. In my last article, I shared that you certainly have to be patient and kind as you understand that not every dispensary will carry your product and let’s be honest, there are some that you may not want to be in or that can afford certain tiers because their geography within the state doesn’t match the dollars that can be spent.
When the market first took off, dispensaries were scrapping for any and all products they could get in and even when trying to build long term relationships and/or contracts, most weren’t willing to make said deals because of the supply and demand and the uncertainty of whether those businesses would last. However, the market is still lopsided with the supply being high (yes, I said high) and the demand not meeting the level of production that’s coming out of cultivation and processing facilities. Sadly, there’s been many frustrated with this flipped conundrum and taking it out on each other. That’s not good business. If you’re in a single lane (not vertically integrated), it’s important to understand that while some dispensaries may be negotiating at high margins, many are passing on the savings to the patients to compete at the retail level. Retail cannabis spaces don’t have the “luxury” of the expense write-offs that other cannabis businesses are able to leverage. Additionally, they will typically have a higher cost of real estate (lease) and more compliance certifications and fees within their respective city limits. Last, they are responsible for the 7% marijuan tax on top of all other taxes and expenses. Let’s wrap with some of the basics and etiquette that can be shared between both the retailers and wholesalers.
It’s important to respect each other’s time and business space. For vendors that are out there hustling face to face, store to store, be respectful and mindful of the retail space in which you enter. You certainly will always take a back seat to any patients/customers that are in the store and I believe most everyone gets this “rule of thumb”. If you do come face to face, bring your professionally packaged samples/products … and bring your best. Too often, I’ve personally heard, “well this isn’t what we currently have” or “this is some older stuff, our new stuff is much better”. You will quickly lose any credibility if you’re bringing older samples or stuff that isn’t professionally packaged to display/pitch. There are far too many that have it together so you’ll be wasting your gas and time if you’re not coming to make the best impression. Next, respect the owner, purchasing manager, or budtender that may say “no” to even seeing the product or declining it. They may have other appointments or they may not be taking in new products at that time. Shoot for a date and time on a calendar if they are interested. If they do agree to check out your product, make sure you’re sharing what you need and that you’re not taking up too much time. The good ol’ elevator pitch of 2-3 minutes should be enough to make the impression needed for a small chance at an on-the-spot sale or a chance to come back for a sale and delivery.
For dispensaries, I feel it’s equally important to be open and honest about where you’re at with products and needs. No need to waste anyone’s time if you’re not taking on any new products or if you are only looking for a specific product. Additionally, it’s not hard to be kind to the person that’s out trying to share their products and earn a living. If they call or come in, be kind and respectful and guide the person for a future date or sharing that you will take a card or look them up and get back with them. Most importantly, if an appointment or sale delivery was made, someone should be there for the appointment or to call and reschedule ahead of time if they aren’t going to make the appointment. If there is a delivery, it’s critical that money is there and the transaction is completed. I’ve personally experienced deliveries to dispensaries where there was no money or they weren’t prepared for the delivery even though it was properly communicated. That’s unfair to the vendors and the person that’s on a schedule of deliveries. Last, many dispensaries have websites with customer/vendor contact form to make appointments. It’s a wise use of everyone’s time to leverage these for making appointments or avoiding wasted time with a business that’s not interested in taking on new products. All in, it’s common courtesy and doing your best to respect your fellow man. Next month, we’ll dive into the power of online awareness and communications and how they can streamline and improve credibility and opportunities.
