Competing with the biggest companies in the cannabis industry is not an easy task. The legal pot industry has seen explosive growth in recent years and shows no signs of slowing, with some estimates projecting a $146 billion+ industry by 2025. With such rapid expansion, it’s tempting to think that you can just jump in and start pulling in your share of the big bucks.
If you have any experience in business, of course, you know that it’s never this simple. Huge growth in any industry will always lead to a glut of new businesses, leading to a lot of competition. For those who didn’t get started in the industry early, rising to the ranks of the highest-performing marijuana businesses can be a formidable challenge.
Entrepreneurs, though, are generally more than willing to face new challenges. Let’s explore a few of the strategies of the highest performing cannabis businesses that you can implement in your path to joining them.
Successful cannabis companies implement the latest tools and technologies to grow their business
Competing successfully in any industry is much easier with the right tools and technologies in place. Every business will vary in the tech that’s appropriate. Some will be a better fit for B2B companies, for example, while others might fit best for those who serve consumers directly. Business technology for the cannabis industry can be quite diverse, and in coming years we’re bound to see new developments in technology such as AI that could revolutionize the business world as a whole. There are a number of current business technologies that will benefit any cannabis business.
Social media and email marketing
It’s hard to imagine a marijuana business that can’t benefit from marketing through email and the many social media platforms. They are effective for canna-businesses of every size and can be used in both B2B and B2C companies.
These marketing tasks happen to be among the easiest to automate. Tools like Hubspot and Marketo are used by some of the best brands in the world. While humans will still be needed to create emails and social posts, there is a vast amount of software to automate the scheduling, sending, and posting.
Collecting signatures digitally
Doing business means signing documents and getting documents signed. This is true regardless of the industry and regardless of the niche.
Not long ago, getting something signed meant you either had to meet in person or overnight the required documents. Fax machines speeded up the process in many cases but didn’t help if a “wet” signature was required.
These days, signatures can be collected electronically with software like DocuSign. This is a much faster way to get things done and a technology every business should be using.
Cloud storage and online backup
This is a business technology that has made its way into the lives of many consumers, too. Keeping your company’s data in the cloud allows you and your team to work on documents remotely. It simplifies collaboration. It ensures that your data is always backed up – any reputable cloud service has many redundant servers in multiple locations so that there is always another copy of your data in the event one or more servers fail.
Similar to cloud storage, online backup services allow you to protect any data that must be stored locally. It is a much safer option than storing backups locally, though ideally, you should do both. Google Drive is a commonly used platform. Other large companies like Microsoft have similar offering, and there are many internet-only companies like Dropbox who can help.
Keeping up with your clients
If you have an outside sales team, you need a way for them to manage client relationships. Old fashioned pen-and-paper methods are simply not adequate in the modern world. Fortunately, there are a number of Customer Relationship Management (CRM) platforms available to help track every customer interaction, monitor sales opportunities, and even automate much of your marketing efforts. Salesforce created this category; less known companies like Zoho and Nutshell also compete in this space.
There is a lot more to business technology than this, of course. To become a top performer in the cannabis industry, your business needs to recognize and adapt to changes not only in the industry but in the business world as a whole.
Know the value of a great team
People are critical to the success of any business. To compete with the top performers, your cannabis company will need to recognize and implement strong HR practices to ensure the development and management of a great team.
High employee turnover can kill an otherwise good business, and unfortunately, the legal marijuana trade tends to experience a higher rate on average than many industries. This is particularly true among the retail businesses, and especially dispensaries. Recruiting the right people from the start will help to minimize this challenge.
Most business people know that it costs far more to hire and train an employee than it does to keep a good person on staff. Your team improves with time and experience. Not only does each individual develop and improve their skills, but their cohesiveness as a team strengthens as well. Hiring the right executives will help to ensure the development of a great team overall.
Your cannabis business team goes beyond your in-house staff
Your employees are critical to your success, but they aren’t the whole picture. A successful business needs the right advisors, too.
Cannabis is a unique industry with a number of regulatory, compliance and other issues to navigate. While every business needs to have a good accountant and a good lawyer, at a minimum, with the legal hurdles in this industry, you’ll need to be especially diligent in developing the right relationships.
Accounting for cannabis companies requires more than someone who understands business accounting; you need someone who is familiar with specific challenges in the marijuana industry—challenges such as dealing with a mostly cash business, for example. The same is true for your legal team; you need a lawyer who knows the intricacies of the cannabis laws in your state and how to navigate uncertain federal rules.
To truly “run with the big dogs,” you’ll want to consider developing advisory relationships beyond the obvious. Your lawyer and your accountant are essential, to be sure, but there are experts in other areas who can benefit your business greatly. A great marketing advisor who understands the world of weed can help guide your marketing expenditures. A strong cannabis logistics advisor will know how to deal with tricky regulations when it comes to transporting your product.
Becoming a top performing cannabis company is going to take hard work and dedication. As a business person, you’re well aware of this reality. The right tech, great human resources practices, and a solid team of advisors won’t guarantee your business’s performance, but they’ll certainly significantly increase your odds of success.