The cannabis industry has been one of the fastest-growing segments in the American economy over the last decade. In fact, legal marijuana sales are estimated at $22 billion next year, and those numbers are expected to rise as more and more states legalize cannabis for medicinal uses and ultimately for recreation.
For operators, there are typically two main aspects of a cannabis business -- the grow facility and the retail space where it is sold. While we cannot help you optimize your crop yield, we have learned some great tips from the cannabis industry that translates well into any retail store.
SECURITY
Security is critical, especially when there are reports that as much as 87 percent of marijuana sales revenue comes from the black market. It's critical for cannabis operators to keep both grow facilities and retail operations as secure as possible from potential break-ins. Theft can result in loss of cash and loss of inventory.
At the same time, security is often an important component of the legalization process. Depending on the state and municipality, regulations will often require the use of things like security cameras and the ability to secure the perimeter of a facility. Receiving a license to operate will most likely require security measures.
SAFETY
The COVID-19 pandemic had negative impacts on all types of businesses, but the cannabis industry was not one of them. In fact, according to Forbes, the marijuana industry grew at records rates in 2020. To underscore the impacts of the pandemic versus standard growth, there was a visible spike in cannabis sales in March of 2020 as stay-at-home orders were put in place.
One reason cannabis operators found so much success was their ability to transform traditional retail spaces and bud bars into areas that conformed to COVID regulations and by promoting safety. In many states, cannabis workers were deemed as essential workers, and the operations that made adjustments to the retail sales process were able to help keep customers and staff as safe as possible, while also capitalizing on increased demand. The quicker and more efficient the bud bar, the safer and more profitable it became.
APPEARANCE
Lastly, appearance is absolutely a critical component to cannabis sales and the overall customer experience. Operations with retail spaces that are "busy" and cluttered cannot provide the same "clean", relaxed experiences that an operation with a more modern, minimalist approach can. This is important for customer retention.
While there's certainly the need for function to drive the fashion (for example, in Illinois many cannabis operations include lounges for consumption, while in other states they do not), the design of the space should still be cool and calm without being generic and sterile. Technology is part of this equation, as well. With tablets, iPads, and electronic menu boards, it's easier to create a modern appeal while making the budtender's job just a little bit easier. If a cannabis retail space looks more like the Apple Store and less like Spencers in the mall, customer retention and sales will benefit.