Why Do Some Cannabis Dispensaries Fail?
The growth of cannabis acceptance and legalization in recent years has made the cannabis industry one of the most lucrative industries around. Different personalities are cashing in on the opportunities in the industry with most leaning more towards retailing and setting up cannabis dispensaries.
What is a cannabis dispensary?
Basically, dispensaries are legal establishments where cannabis users can easily get their favorite cannabis strains without any hassle. Dispensaries also have well-trained budtenders who attend to customers and provide quality information on strains available in the dispensary. The culmination of these individuals along with managers help to ensure cannabis retailers maximize opportunity and make quality returns on revenue.
While setting up a cannabis dispensary it is important to note that although cannabis is a recreational and medicinal product loved by many, operations in a dispensary should be standard as seen with other businesses. This has been a major factor that has resulted in many cannabis dispensaries not living up to their billing as a lucrative venture. Though there are cannabis dispensaries that are successful, some are a disaster. The technicality of the process involved in making a dispensary a success story is why It is direly important to take note of the mistakes the unsuccessful ones made that caused their downfall.
Below, I'll be delving deep into some of the cogent points that can make or break a cannabis dispensary. Read on!
Compliance with regulations
Gone are the days when cannabis was seen as a counterculture. The current move of things is now towards legalization and not prohibition. In light of this, it is expected for cannabis businesses and more importantly cannabis dispensaries to be in line with a different set of regulations put forward by relevant authorities. Unfortunately, it has been observed that some cannabis dispensaries tend to take some of these regulations with levity causing lockdown and failure of the venture.
Since legalization became the order of the day, regulators have chosen to use stringent sets of rules and requirements to ensure quality control in the cannabis industry. It is therefore important for every cannabis dispensary that aims to last long in the industry to ensure total compliance with all rules and requirements in terms of licenses and other things needed before a cannabis dispensary can be operational. This is because such sets of rules have repercussions if broken. Employees need to be well drilled on requirements to ensure full compliance. Likewise, quality standard operating procedures must be put in place.
Customer experience maximization
The goal of every business venture is to make a profit and this is largely tied to the ability to satisfy customers. The ability to know your customer, their needs, and show empathy when necessary plays a huge role in determining the success of a business venture. The inability of some cannabis dispensaries to fully play this role and utilize it in boosting their brand has led to their downfall. With many patients buying cannabis products for medical marijuana, it is important for budtenders to show empathy while dealing with such customers.
A lot of cannabis dispensaries have failed in maximizing the benefits of a good customer experience. This has resulted in a decrease in the number of customers that patronize them and ultimately, the failure of the venture. This is why is important to ensure that all the parts of the dispensary are in the best condition possible. The products must be of the required quality and all the necessary information that pertains to price, product description, and so on must be easily accessible. Simplifying this process coupled with quality customer service and a conducive environment will help you maximize customer experience which eventually increases revenue.
Fiscal management
It has been said earlier that though cannabis is a recreational and medicinal product that users love, a dispensary should always be seen as a business institution. This means that all the necessary operational implementations seen in business firms and other top institutions in terms of fiscal management should be seen in dispensaries as well. Lack of proper fiscal management policies and protocols has resulted in the downfall of a lot of dispensaries. This is why proper attention must be paid towards implementing it in the best way possible.
A vital part of fiscal responsibility expected to properly run a dispensary is foresight in terms of operating expenses. For emerging markets like the cannabis industry, the lack of stability means some waves can easily rock the industry and cause turbulent times for stakeholders. This can come like a change in regulations or availability of products which is why dispensaries need sufficient operating expenses to keep the firm running.
HR and PR
Human relations and public relations are two important aspects that play a vital role in determining whether a business venture flies high or sinks. Human relations plays the role of properly equipping the workforce and ensuring that they have an understanding of their roles towards the goals of the business. Public relations helps to ensure that customers are carried along concerning the necessary information that pertains to the dispensary. If both roles are properly utilized and maximized, they help to ensure a dispensary fully optimizes its commercial activities.
Operational structure
The chain of command and order of operations in a cannabis dispensary needs to be properly stipulated in order to ensure proper workflow. Cannabis dispensaries where roles and functions are not properly stated quickly arrive at their ruin as is always the case whenever responsibility isn't imbibed in a workforce. When organizational structures are well defined, the next thing is to work on the flow of operations. Some systems and responsibilities can be automated to ensure optimum efficiency. There are different technological advancements that can easily be introduced into operations such as sales reports and others to further improve the standard within the system.
Bottom line
Much of the talking points stated above have to do with the effectiveness of the leader or head of the dispensary. A responsible leader will help to ensure that most of the common mistakes that dispensaries make that cause operational failure are avoided. With that handled, the dispensary can fully focus on maximizing profit and taking the business to the next level.
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