DENVER, COLO. (April 4, 2018) – Baker, a CRM in the cannabis industry, continues its fast-paced momentum, announcing that it has surpassed 1,000 dispensary customers and it is opening a new office in Los Angeles, its third in the U.S. in just six months, according to a press release. The rapidly growing “Salesforce of Pot” now has over 25 percent market share in the cannabis industry and with offices in Denver, Los Angeles and Seattle, is looking to continue to expand its footprint and services to dispensaries. 

“We’re thrilled to see the results of the relationships we have created and the trust we have established with dispensaries across the country,” said Joel Milton, co-founder and CEO of Baker. “The size of our network, coupled with our new office openings and proven track record, is why more and more businesses are joining the Baker platform.”

On a mission to create a seamless tech ecosystem where dispensaries can easily be connected, Baker also recently announced the launch of its expanded integrations program including an API (Application Program Interface). Now with over 20 integrations, dispensaries all across the United States, Puerto Rico and Canada can easily transition between ancillary services including point of sale systems, digital signage, customer acquisition services, advertising networks and agency and design groups, among others. 

“The platform has brought so much value to our brand, organization, and customers. More importantly, the entire Baker team is made up of brilliant, innovative people who are committed to our success. I can't imagine moving into the future without a partnership with Baker. They have worked alongside us at the forefront of change during the most challenging and rewarding moments of the year. We are so grateful for their trusted insight and dedication. In many ways, Baker enabled us to improve and take leadership in our Customer Relationship Management and Marketing. I recommend this service to any cannabis business,” says Aline G, Organic Green Treatment Center in California.

These recent milestones follow news of Baker raising an $8 million Series A round, bringing its total amount of capital raised to $11.5 million, which makes it one of the most funded companies in the Cannabis industry. Late last year, Baker also acquired Seattle-based Grassworks Media, solidifying the company as the leading CRM platform and go-to solution for Cannabis retailers.

The Denver-based software company helps dispensaries grow their brand and build relationships with their customers through a variety of products including online ordering, customer loyalty, customer messaging and analytics. On average Baker clients see a 40-percent boost in average order size, and a 300-percent ROI in just 10 weeks.

For more information about Baker, please visit www.trybaker.com.

In January 2018, longtime marijuana entrepreneur Christian Hageseth launched ONE Cannabis, a franchised dispensary brand that is quickly planting roots in legal markets on both coasts. Like the food service titans before him, he’s seeing an opportunity only now for a franchise business model to flourish in cannabis.

While many in the industry share dynamic visions of where the adult-use retail market may lead, Hageseth has one of the more visible vantage points. He’s been in the game since 2009, partnering with five dispensaries in Colorado and helping to build seven cultivation outfits.

For years, he helmed Green Man Cannabis in Denver.

“We got very good at operating compliant and profitable marijuana operations,” Hageseth tells Cannabis Dispensary. “And I say that in that order for a reason: To be successful in this business, you first have to be compliant. And then you have to be profitable. And after you do those two things in that order, you can do whatever you want.”

These days, Green Man is led by a professional management team and is a prominent partner in ONE Cannabis’s franchising portfolio.

Over the years and across nine states, Hageseth says he honed his business chops in a fragmented industry that’s only now beginning to coalesce. As Green Man grew into a compliant and profitable brand, he and his team scanned the horizon for the next challenge to overcome. Denver was one thing, but Hageseth was interested in seeing his company touch further corners of this burgeoning domestic marketplace.

“We were getting more versed on what was happening in other states and we were looking at our options,” Hageseth says. “‘How do we really scale this business? How do we take a successful model and transfer it into other states?’”

Because that marketplace is stitched together without the benefit of interstate commerce, his team inevitably turned toward the franchise model—where all roads lead in U.S. industry, Hageseth says.

Now, on top of its filing in Colorado, ONE Cannabis has partnerships in Ohio, Michigan and California. The company is working on deals in Nevada, New Jersey and Florida: a variety of locales, a blend of adult-use and medical.

“We’re really just looking to continue to do what we’ve gotten good at,” Hageseth says, “which is operating compliant and profitable marijuana businesses and helping other people to do that and be successful with it.”

There are several prongs of business with which ONE Cannabis will work. Most commonly, Hageseth says, he’s seeking the new entrants, the entrepreneurs just now looking to get involved with their state’s newest industry.

The profiles of those entrepreneurs are changing as the industry evolves, making the timing of the ONE Cannabis launch particularly keen. “The new entrants are more sophisticated and have more money now than they did five years ago,” Hageseth says, pointing to the rising start-up costs of cannabis business applications in many states.

Where initial application costs once demanded $100,000 or so in the bank, competitive business owners are now prepared with at least $1 million (oftentimes much more) when the state licensure process begins. The baseline capital requirements vary from state to state, but, for example, Massachusetts’ new market insists that operators have at least $500,000 in cash before even thinking about applying for a dispensary permit. It's another sign of a maturing industry.

“The new entrants … are willing to acknowledge what they don’t know,” Hageseth says. And, more often than not, he adds, they’re interested in owning and operating multiple dispensaries.

Along with newer dispensary owners, ONE Cannabis will partner with existing operators and the growing class of capital groups with no real operating capacity. Companies that are hoping to improve their internal systems—to reach that compliant and profitable playing field—are ripe for the ONE Cannabis touch.

With the spectrum of financial costs levied on the cannabis industry, it’s no easy task to hit those qualifiers. “There are certainly a lot of people out there operating that would appear to be profitable on paper,” Hageseth says, “but when you take the full accounting of what [IRS Code] 280E really costs, they’re not profitable.”

The ONE Cannabis launch puts Hageseth’s experience front and center for potential franchisees. For an industry as dynamic and unsettled as cannabis, those years of work in Colorado and elsewhere are a boon to the rookie entrant. Hageseth says he’d have liked to see something like ONE Cannabis when he was getting into the industry..

“There are very few situations that we haven’t seen or been challenged by—and successfully overcome,” Hageseth says. “Only now does the cannabis industry have players like us that have enough experience to be a franchisor.”

And, on the other side of these partnerships, Hageseth believes that the franchise model will lift the industry in the U.S.

“I do think that the evolution of the franchising model in cannabis is inevitable,” Hageseth says. “That’s just because I observe what happens in the rest of industry in the Western world. The franchise model is very popular, and I think the marijuana industry is in need of those types of operations.”

Hageseth says the linchpin of the franchise model is the same for consumers as it is for business owners. Brand consistency begets brand loyalty and, even better, brand affinity. “They get a brand that they can believe in and become loyal to and have that repeat experience of, ‘Hey, last time I got Super Lemon Haze here it tasted just like the next time I got it. My experience is consistent. So, I know that the next time I want Super Lemon Haze I can count on getting the same thing.’”

Top photo courtesy of Green Man Cannabis

This article originally appeared in the February 2018 issue of Cannabis Dispensary. To subscribe, click here.

The right lighting in a dispensary can improve customers’ moods—which can lead to more positive behavior inside the dispensary and even create repeat customers—as well as positively affect employees, who may sleep better because of the dispensary lighting, explains Robert Soler, M.S., vice president of human biological research and technology for Biological Innovation and Optimization Systems (BIOS), a science-based company that creates LED lighting for a variety of applications.

But how can you achieve that ideal lighting in your dispensary? Here are nine tips from industry experts to help you change your lighting—and your business—for the better.

1. Think about what will make your customers most comfortable.

When Dockside Cannabis thought about the lighting in its dispensaries in Seattle and Shoreline, Wash., the company wanted to “portray openness, safety and an inviting atmosphere” to its customers, just like they would experience in any other retail setting, says owner Aaron Varney. “Dispensaries that want to give their customers a sense that visiting … [the dispensaries] is normal retail behavior will use lighting accordingly,” he says.

2. Use higher illumination on your products.

“Products that you want to feature should be lit [more brightly] than other products,” says Soler. Why? Recent research from BIOS uncovered that people have powerful photo-receptors in their eyes linked to their gaze—photo-receptors that are attracted to bright lights. Put simply, photo-receptors are “the reason why—when we drive at night—we tend to look directly at oncoming headlights or street lights,” he says. “This phenomenon can be used to highlight products.” For example, when you place higher illumination on some products and less on others, your customers’ eyes will be drawn to the highlighted products, which can drive sales exactly where you want them.

To read the full article in Cannabis Dispensary's February 2018 issue, click here. 

Top photo courtesy of High Road Design Studio. Level Up in Scottsdale, Ariz., showcasing different levels of lighting for ambiance and product focus.

Bank of Springfield, the primary financial institution for the cannabis industry in Illinois, is closing all accounts associated with marijuana businesses, effective May 21. 

The Chicago Tribune first reported this story this week, pointing out that bank executives had been mulling the decision for a few months.

Bank of Springfield spokesperson Andrew Mack told Cannabis Business Times that the board of directors took a number of issues into consideration, including U.S. Attorney General Jeff Sessions’ Jan. 4 repeal of the Cole Memo. 

“When Illinois jumped into the fray a couple of years ago, things really seemed to be moving in a general direction,” he said. “The Cole Memo provided a lot of guidance and assurance—and then the Rohrabacher-Blumenauer amendment—and more and more states were moving toward serving the cannabis industry. The rhetoric coming out of Washington and then the actions by the attorney general rescinding that memo just really shook the bank.”

The Illinois General Assembly first passed the Compassionate Use of Medical Cannabis Pilot Program Act in 2013. Sales began in November 2015.

“They didn’t arrive at the decision lightly,” Mack said. “Banks, by nature, are pretty conservative. They have a lot of other customers outside of the cannabis industry. They just thought that it was most prudent to step back from the issue, and they arrived at the decision to pull out.”

According to the Illinois Department of Financial and Professional Regulation, Illinois has 54 active dispensary licenses, and industry database Cannabiz Media lists 21 active cultivator licenses. Mack could not say how many cannabis businesses this will affect, citing the confidential nature of the letter.

As part of a broader sense of financial uncertainty in the industry, the Bank of Springfield news will cause a shakeup in the normal course of business. The Tribune reports the state’s medical marijuana program generated $8.5 million in sales in February of this year.

“For the industry at large, it’s a real kind of punch in the gut,” Jeremy Unruh told the newspaper. Unruh is the director of public and regulatory policy at PharmaCann, which owns two cultivation centers and four dispensaries. “If you’re a dispensary, you need to pay for a wholesale product, and you don’t have a bank. How do you do it? That transaction might have to be in cash.”