Updated: Jan 8
Often times if any given retail outlet is not properly tracking demographics and sell-through rates of all items in-house, they begin to fall behind on potential revenue without even seeing it happen. A typical example of this is budtenders frequently praising one brand over another based on personal preference, palette, and budget as opposed to customer wants and needs. Once this sentiment is then voiced and voiced again amongst staff and eventually falls back on your buyer. After this process repeats roughly 3-5 times this becomes the main metric for reordering. This creates a ripple effect through the inventory process from several standpoints we will explore in my very first blog!
Your inventory quickly becomes lopsided gearing toward only a small set of products usually with a low price point and a margin to match. One of the main reasons is due to lack of staff exposure to product and education regarding sales tactics, product comprehension, and their ability to up-sell and recommend outside their preferences. These products are typically grouped very closely in price leaving very little room for improvement in spaces like sales, marketing, and staff education.
Once this has happened, your second effect is your entire supply chain, consumer base, monetary goal, and overall reputation become geared toward a very small client base. This begins rapidly depleting your reputation outside this small consumer base at a ratio that is not in line with your ability to recuperate that lost revenue or reputation without drastic measures. This corners your retail into a very small market share of a very low-end market product such as $35 8ths, value shake/flower, and cheap vapes and prerolls dominating your menu. This further grows your consumer base of the type of customer that is generally aiming low in purchasing habits, putting you even deeper into the cycle of poorly crafted inventory and menu design reaching a very stagnant place.
The final effect I see this occur most frequently is an incoherent inventory or ordering staff. In severe cases sometimes several, gatekeepers, approved ordering staff, buyers, owners who think they're buyers, and frankly just poorly trained buyers all with their hand in the pot adding lopsided ingredients. A friends vape here, and buddies obviously subpar flower brand there, that awful tincture your budtenders swore they could sell because they liked the rep, all these are things that for even a short period if participated in will leave your inventory in an absolutely terrible place.
You may be asking yourself "how am I suppose to fix the problems of the world?" Well here are a few simple steps that can be taken fairly quickly to ensure this process starts. Its critical high-end Cannabis Brands step up to the plate and ensure staff that may never be able to purchase their product has tried their product and comprehends its value completely. Secondly, if these sound like things you are seeing around your retail outlet go to Thefamilytreeconsulting.com and send us a message. With extensive experience in cultivating wildly successful menus around the Bay Area, our program can put you on track to make 2021 your highest-grossing year yet.