Director of Strategy
It’s August and our first dispensary turns 1 year old this month!
It’s been a busy few weeks for us at Aloha Green Apothecary: We introduced a full line of concentrate products in June (when our lab became fully operational), new Hawaii laws passed in July to allow pre-filled vape cartridges and preparations for our one-year anniversary made it feel like 4/20 all over again.
With our first year under our belt, the systems we put in place have made our retail operations an efficient, well-oiled machine. Dispensary management and staff have graduated from the basics of putting in error-free orders to building relationships with patients and understanding our market’s idiosyncrasies. We have learned, tested and confirmed what works to maximize revenue; our discount programs, online pre-ordering, VIP club benefits, loyalty points, special sales, raffles and marketing strategies have been optimized. And now, we are finally using the biggest tool in our toolbox: price.
Since the expansion of our greenhouse, we’ve been able to scale up production and maintain solid supply for our dispensary (which is critical in Hawaii, where all eight licensees are vertically integrated and there is no wholesale market — if your dispensary runs out of product, you have to shut down until the next harvest ships). And though having a solid supply sounds “normal,” it’s an exciting new stage for our team. Solid supply means having enough inventory to run sales! Until recently, we couldn’t lower prices for our products without the risk of our inventory getting uncomfortably low.
At first, we didn’t have a comprehensive strategy for sales and discounts. We’d throw something together the day of, frequently just minutes before we decide it’s a good time to send out a mass text. Sometimes, we would stack a bunch of deals. We texted sometimes, sent emails other times, did both or neither the rest of the time. We would have huge days and embarrassingly slow days, unable to truly grasp which of the numerous variables were doing what. We weren’t applying basic economics to a very basic economics situation.
It was clear that we needed a SMART process — specific, measurable, attainable, relevant, timely — that would help us understand our supply-and-demand curve. To get smart, we created tools to keep all the balls in the air and everyone on the same page. We now have cost spreadsheets calculate our “floor” prices, and our customized pipeline and inventory dashboards provide medium-term perspective so our sales can be planned accordingly. We created checklists that make sure we cover all our bases when brainstorming ideas and benchmarks that help us measure the effectiveness of every sale we run.
What’s your strategy for running sales? How well do you know your numbers? Are you sure you’re taking all your critical factors into consideration? And, most importantly, what’s your debriefing process so you can learn from your decisions? It takes time and effort to get organized and understand all your data, but it’s the only way to run your business confidently and effectively. Everything we learned this first year has become the foundation of our growing company, ensuring that we will have many more anniversaries to celebrate in the future.