Cannabis businesses are no strangers to change—from frequent shifts in state programs and oversight, to the uncertainty of banking access and federal law. While cannabis businesses have seen themselves as vital from the beginning, navigating what it means to be “deemed essential” during the coronavirus crisis has brought new challenges by the hour.
In Illinois, for instance, the state’s strict sanitation guidelines now require medical dispensaries to disinfect all consumer-touching surfaces every 30 minutes, according to the Illinois Department of Public Health.
“In a 10-hour shift, that’s 20 times sanitizing the entire place: ATMs, countertops, bathrooms, et cetera,” says Charlie Bachtell, CEO and co-founder of Cresco Labs, a vertically integrated, multi-state operator. In an effort to help while “not getting in the way of a finely tuned machine,” Bachtell says he designated himself “the cleaning guy” and quickly got the process down to a consistent 12 minutes of cleaning, 18 minutes off-cleaning.
Retailers have looked to federal and state guidance on best practices to keep everyone healthy while still providing access to patients and consumers. Dispensaries also are adding their own protocols in addition to state requirements to keep people safe. But running an essential business smoothly and safely during a pandemic takes more than regular wipe downs. Here are a few other ways retailers can help see their businesses through this pandemic.
“If there’s one thing that something like this will remind everyone of is that communication is usually the foundation of success or failure. … Overcommunicating is the objective,” Bachtell says. “That rings true for your employees, for your customers, for your regulators, your investors, your partners.”
Curaleaf has been able to virtually eliminate wait rooms and lines by using Waitlist Me, a restaurant management app with call and text features to keep customers up-to-date and in queue from the comfort of their cars or homes. “To be able to control patient flow has been critical,” says Chris Melillo, senior vice president of retail at Curaleaf. “It gives us autonomy to ebb and flow the busiest parts of the day.”
Work with State Regulators
Melillo and Bachtell point out the need to stay in constant contact with state regulators to find fast solutions for increasing safety and efficiency with services like curbside pickup, delivery and credit card payment options. “It’s not us vs. them. It’s us together serving patients,” Melillo says. “I think the most important thing is showing states where you can have an opportunity to make an easy enhancement to the patient experience and overall business.”
This is particularly imperative for smaller operations where resources like access to a surplus of sanitation supplies can be difficult to come by, explains Chrissy Hadar, co-founder, president of retail and chief branding officer of Oregrown. “We’re having to get creative. Luckily, that’s one of our strengths, and we are resourceful without a doubt,” Hadar says. “We use things like isopropyl alcohol or hydrogen peroxide to sterilize pens and other office products to ensure the safety of our staff and our customers.”
Take Care of the Team
“The only way to keep people employed is by remaining open,” Hadar says. But, inevitably, staff may get sick or feel uncomfortable interacting with customers. Paid sick leave lets team members know they are supported because, Bachtell says, “there is no wrong way for somebody to react to a global pandemic.” Cresco added a policy for employees who don’t feel comfortable coming in. “That’s not lip service,” he says. Because, in the end, Hadar adds, “we’re all in this together.”
Andrea Sparr-Jaswa is science editor of Cannabis Dispensary and Cannabis Business Times.
The power of digital media has perhaps never been as apparent as these past few weeks, as the news continues to change hour by hour amid the novel coronavirus pandemic.
One notable example happened in the Cannabis Dispensary team’s home state of Ohio. Many voters had already gone to bed when Ohio Gov. Mike DeWine made a late-night decision to postpone the state’s primary elections the night before they were to take place to prevent further spread of COVID-19.
Media outlets scrambled to update citizens in the state, especially those nimble online resources that could report the news the instant it broke.
Cannabis Dispensary has also been keeping you updated with the latest COVID-19 news and what the pandemic means for the industry on CannabisDispensaryMag.com, and through its e-newsletter, social media channels and webinars. We answered questions such as: Are cannabis businesses considered essential in states with stay-at-home measures in place?; Does Small Business Administration disaster assistance apply to cannabis companies?; Have dispensary sales increased or decreased?; and How have dispensary businesses adapted to and been impacted by the coronavirus pandemic?
We’ve provided an essential service to an essential industry, with both big-picture, what-does-this-all-mean articles and close-ups of the innovative ways dispensaries are adapting with curbside pickup, delivery, fast-tracking drive-thru plans and communicating with customers while keeping social distance policies. Dispensaries, thanks to savvy leaders and the incredible efforts of budtenders, are doing all they can to make sure customers and patients have access to cannabis during this difficult and unpredictable time.
Though the fallout from coronavirus has hijacked normal news cycles, our team has continued to have its pulse on the industry, continuing to share important updates through series such as “Legalization Watch,” a state-by-state look at the latest efforts to end prohibition, and “The Starting Line,” which examines dispensary launches across the U.S. and Canada.
The dispensary marketplace has always had a dire need for up-to-the-moment coverage of a constantly evolving regulatory landscape that varies by state.
This virus has demonstrated how fast the world, and news, moves, and the importance of our role in bringing you daily updates on its impact on the cannabis industry. Plus, the dispensary marketplace has always had a dire need for up-to-the-moment coverage of a constantly evolving regulatory landscape that varies by state, and our robust online presence has become increasingly vital to our mission to serve and educate cannabis retailers.
Because of this, we are expanding our digital resources, where we can most effectively serve your needs, as you and your teams have done for your patients and customers throughout this global crisis.
As part of our revamped digital efforts, we will be tapping our extensive experience in providing industry-leading education to bring you webinars, virtual conferences and other digital products to help you and your teams navigate the ongoing challenges and opportunities as the industry, and the world, continues to change. Keep checking our websites and e-newsletters for updates.
We are especially looking forward to seeing you in person again at our annual Cannabis Conference, which was postponed to protect the health and safety of our attendees, exhibitors, speakers, employees and the hotel staff. The event has been rescheduled for Sept. 1-3, 2020, in Las Vegas. The fall conference comes at an even more critical time as the industry emerges from this global pandemic and the resulting economic fallout. Many lessons have been learned, and while these lessons have been necessary for many businesses’ survival, they also will help build stronger companies and supply chains, and a stronger industry for the future.
Until then, please stay safe and healthy. And, just as you are socializing with friends and family online, please connect with us digitally, too, at CannabisDispensaryMag.com.
Michelle Simakis, Editor, firstname.lastname@example.org
COVID-19 is scrambling supply chains and route-to-market options, forcing notoriously slow governmental cannabis offices to respond much more rapidly than we have ever seen.
Many dispensaries are implementing social distancing measures, such as offering curbside pickup (where possible), limiting the number of customers in the store at a time, and encouraging or mandating online ordering or delivery.
This is a strange time, and in some ways an opportunity to right many inefficiencies within the market by swiftly addressing issues and challenges. Governments have shown they can and will respond with solutions if driven by a crisis.
Products that can produce intoxicating effects are mostly insulated from market shocks in terms of demand, and we will likely see consumers continuing to turn to cannabis to handle anxiety or to combat sleeplessness.
With so many new-to-cannabis consumers transitioning to regular use, demand seems poised to skyrocket. Brightfield estimates show cannabis newcomers often graduate to “heavy users” after two years of use. Heavy use from these consumers is the growth vector that will scale new markets and make established markets more robust.
Most stores Brightfield Group contacted between March 2-5 reported sales up across formats, generally in line with typical sales. Some reported customers stockpiling cartridges, concentrates, edibles and other packaged products. Stockpiling of flower where market prices and supply allowed were reported by retail managers in all states. One Oregon retailer told Brightfield: “Almost everyone is buying an ounce.” Of consumers Brightfield surveyed, 52% reported they already stocked up or are planning to stock up on cannabis, while 28% said they planned on reducing their spending on cannabis.
Meanwhile, dispensaries in Canada have implemented next-day or same-day delivery in some places through their online stores. Current circumstances would call for a reversal of the channel trends we have seen; online sales plummeted from more than 40% of the market at the beginning of 2019 to less than 7% by the end of the year. 2020 may look different.
As for CBD
Of consumers surveyed by Brightfield, 48% have stocked up or plan to stock up on CBD, and 39% of consumers plan to use CBD more frequently. Only 23% of CBD consumers said they plan on reducing their spending on CBD.
Younger consumers are more likely to plan to increase their CBD usage, as nearly half (47%) of Gen Z and Millennial CBD consumers plan to use more frequently, compared to only 37% of Gen-Xers and 27% of Boomers.
Andy Seeger is the cannabis research manager for Brightfield Group, where he performs quantitative and qualitative analyses of the U.S. medical and adult-use markets.
As 2019 came to a close, tens of thousands of customers across multiple U.S. cannabis dispensaries were impacted by a data breach linked to a point-of-sale software company.
Cannabis businesses are particularly vulnerable to cyberattacks due to the vast amount of personally identifiable and protected health information that they are required to collect and store, as well as any trade secrets they maintain in their company databases.
Here, HUB International, an insurance broker that provides business and personal insurance as well as employee benefits across North America, outlines some cybersecurity best practices for cannabis cultivators and distributors to help them combat cybercriminals.
1. Limit the number of people that have access to your secret sauce.
This is especially important when sharing details with third-party vendors. When workers are harvesting crops, or a cultivator is renting land from farmers and planting on it, proprietary information should be kept in the hands of just the few who need it—and no one else.
2. Secure your R&D process.
If cultivators have created a cannabis formula that boosts energy, or reduces anxiety or pain, these “recipes” are their intellectual property—it’s what gives them a competitive advantage. Growers should consider the way they store the information behind the R&D of their cannabis crops. Is it on an electronic file, or a computer desktop? What type of credentials do people need to access it? While most businesses will use a third-party cloud service, many growers maintain their own servers because of this risk.
Distributors must also do their part to protect cultivators’ R&D information. Many cannabis distributors have access to their grower’s proprietary R&D information so they can speak intelligently about the product, and understand which products are best for buyers with different medical symptoms. Cultivators should ensure their employees don’t reveal enough to open their supplier to a potential cyberattack.
3. Institute strong employee oversight rules.
Every employee does not need to have access to every sale, or the entire database of proprietary customer information. Businesses should consider delegating jobs behind the sales desk. Give each employee the access they need to do their job—and that’s it.
4. Know where and how your buyer information is stored, and understand how it can potentially be breached.
If employees are scanning driver’s licenses, or even if the business keeps paper files, consider where they are stored. Maybe it’s in a secure area off site, or on a protected network. Maintain compliance with HIPAA, state statutes and requirements for cannabis distribution.
5. Explore your cannabis cyber insurance coverage options.
Cannabis businesses are hard to insure for every type of risk. Although this will continue to some extent as long as cannabis remains illegal at the federal level in the U.S., cyber insurance options for cannabis business have opened up and prices have recently come down. Know that cyber policy underwriters will conduct additional due diligence, going beyond the typical policy application, asking cannabis companies what types of information they collect from their consumers, how they store it and how they access that information at a later date.
Editor’s Note: This article was adapted from HUB International’s blog post titled “Cyber Risk: Growing Like Weeds for Cannabis Growers and Distributors."
Cannabis Business Times’ interactive legislative map is another tool to help cultivators quickly navigate state cannabis laws and find news relevant to their markets. View More