U.S. Cannabis Business Conditions Survey Report Reveals Critical Concerns for the Cannabis Industry in 2022
by Beau Whitney, NCIA’s Chief Economist
As the largest national trade association of the cannabis industry, NCIA works to advocate for and advance the interests of hundreds of member businesses. The recent publication of the Whitney Economics U.S. Cannabis Business Conditions Survey Report offers a granular look at how respondents are feeling, and what they are worried about.
Survey description
There were a total of 396 respondents to the Whitney Economics U.S. Cannabis Business Conditions Survey. Respondents were either licensed cannabis businesses or ancillary businesses to the cannabis industry, and were from 20 states across the country. According to the report, the objective of the survey was to “establish a baseline of data, and identify the successes and the challenges that operators in the industry are facing.”
The survey examined policy, regulatory issues, industry successes, and overall industry sentiment using questions around demographics, questions intended to definitively answer a specific question, and questions with the opportunity to offer multiple responses or comments. We are pleased that NCIA members participated in the survey. Because this survey is intended to be conducted on a quarterly basis moving forward, we expect that a growing number of the NCIA membership will want to participate.
Key Takeaways From the Survey
Only 42% of respondents are turning a profit. Further, in terms of profitability, female respondents and non-white respondents are faring much worse than white, male respondents.
While 58% of businesses overall are not making a profit (either breaking even or losing money), 62.5% of female-run businesses are not turning a profit and 67.8% of BIPOC businesses are not turning a profit.
Lack of banking, market volatility, and state & federal taxation are the key issues facing cannabis operators.
72% of respondents stated that access to banking and other financial services was the top issue facing them.
Smaller operators are struggling by being pulled in two different directions. On one side is the competition from the illicit market that competes for the same customers as the smaller operators and the other side is the ever presence of big businesses looking to consolidate the market.
Taxation is an issue that impacts all businesses regardless of size. Cannabis operators run the risk of being taxed out of business. State policymakers are focused on state issues without considering the impact of federal policy and federal policymakers are not considering the state policy. This lack of a unified tax policy is creating strain on business operators.
The concerns of the industry are weighing heavier on the minds of operators than are the successes, and this is impacting industry sentiment.
Business owners are quite proud of their accomplishments over the past year, from increasing opportunities for women and minorities, to doing more for their workers and educating an ever-increasing clientele.
Despite this success though, cannabis operators’ concerns far outweigh their feeling of success and this is impacting the overall sentiment.
The word cloud on the successes tells a compelling story.
We are very excited that we have now established a baseline of new data that reflects operator sentiment and business conditions. This can help support the narratives with data when having policy discussions at the state and federal levels and to help shape strategy for operators in this space.
“We are delighted on how this initial survey turned out and look forward to surveying the cannabis landscape regularly in the future. We really appreciate the support we received from leading national cannabis organizations such as NCIA.” – Beau Whitney
Member Blog: 2022 Cannabis Supply Chain Concerns Demand Creative Solutions
If there was ever a year that we all learned the importance of the supply chain and its impact on our daily lives, 2021 was it. For anyone who somehow hasn’t realized the effect, take a look at grocery prices the next time you shop. The cost of dairy, produce, and countless other items all highlight a fragment of the ongoing concern across the supply chain.
Heading into 2022, just about every company is pondering a similar question: How do we mitigate current and potential challenges for the next decade?
How did we get here?
The pandemic shined a light on numerous glaring issues and failures in the current supply chain.
COVID-19 spotlighted an aging infrastructure in a way it had never been before. Life moved us all into the 21st century years ago. Yet, U.S. ports remained stuck behind using software better suited in a museum as a relic rather than a relied upon, integral component. Instead of being put out to pasture, we continue to rely on this tech to handle shipping volumes that fail to align with today’s demand. With outdated, turn-of-the-century software, ports could not address the volume of daily imports.
Compounding the issue are manufacturing and inventory programs with zero flexibility or ready-to-implement fail-safes in case of dire situations like the one we’re in today. Companies with non-redundant sites like single-sourced manufacturing for an entire global production perfectly highlight this problem.
Infrastructure is far from the only significant factor. The pandemic upended just about every forecast possible. Furniture and appliance demand surged as people stayed home. Hard goods and eCommerce helped fuel a packaging demand spike, further impacting aged tech at ports. Meanwhile, the auto sector is expected to plummet. But, demand surged while companies slashed manufacturing orders. Meanwhile, tech development is months behind as it attempts to update critical tech infrastructure and other supply chain components.
Over the past two decades, a race to the bottom on production prices led many to offshore manufacturing. Once considered a viable option is now a significant pain point as stability wanes and tariffs increase. Then there are material shortages that halt production. This predicament is well on display for any goods made using materials like paperboard, resin-based materials, dyes, and adhesives.
The pandemic certainly did much of the damage, but domestic factors worsened matters, like the South Texas winter storms in the United States. Adding to the goods strains is the consolidation of manufacturers, limiting supply options during crucial times. This underlying industry concern kneecapped numerous sectors operating with just a few producers.
However, the most significant impact is the shortage of people. The tragic loss of lives, mandatory isolation orders, and full-site shutdowns limited the people power needed to sustain the marketplace. From ports to factories to transportation, every facet of the chain continues to struggle with a lack of people.
What is the current state?
The current state of affairs presents critical concerns. Like the year before, companies must contend with concerns that are substantial enough on their own. When coupled together, they create historical challenges.
Labor shortages continue to affect production. The Omicron variant has been the latest problem, just as optimism returned to many workplaces and organizations. The workforce dearth has once again slowed or stopped progress. Expect delays even when labor returns to full force.
The circumstances leave us in a dire time. Inflation has run rampant, impacting labor, transportation, substrate, and countless other costs. While the times are tough, we can remedy the problems with the right frame of mind and proper implementation.
A World Not Without Hope
The ample amount of adversity offers its slivers of silver linings. One of the brightest bits of optimism is the versatility of options available. Just about anything could be viable.
Think dynamically. Listen, consider, forecast, and plan for the days and years ahead. Success lies within your team and customers. Consider all opinions when planning your next steps. Knowledge is vital to ensuring that these issues never happen again. With insights gathered, find the software, suppliers, and other needed components to make your supply chain thrive.
Now may be a good time to consider production closer to home. If impossible, make sure that your partners match timelines and production plan milestones before beginning any relationship. Sustainability is another concern that can’t be overlooked, even if it often comes at an additional cost. Its importance often clashes with sourcing consumers and other critical points mentioned here. That said, packaging can and must do what it can to reduce its carbon footprint—source from eco-conscious companies with options for recycled and/or recycled materials, alternative substrates, and other sustainable options whenever possible.
We should expect inflation to continue growing for some time despite substrate cost stabilization expected to help to a degree. As such, ask how prepared your company is for the challenges ahead. Evaluate every process component, from production to packaging to branding. Taking time to account for every possible hurdle ahead should best position your company to keep costs at a minimum while creating sustainable, consumer-friendly products that won’t get held up in ports and additional shipping lanes.
While times are tough, we can progress in the right direction. Now is the time to streamline the production process to develop customer-friendly products that puts sustainability into action. It’s a tall task, but creative thinking and proper implementation will work, benefitting us all in the process.
Elizabeth Corbett, VP of Sales for AE Global, is on a mission to build sustainable packaging & supply chain programs for cannabis and CBD companies which honor their brand identity, drive revenue growth, protect the product and do so cost effectively. “CannaBeth”, as she is fondly known, entered the cannabis industry more than eight years ago after spending the first part of her career developing packaging solutions for significant players in the retail and health & beauty markets such as Starbucks, Tiffany and Estee Lauder. Based in Seattle and Miami, Beth is passionate about finding environmentally responsible and sustainable solutions no matter what the form or substrate.
Video: NCIA Today – Thursday, January 27, 2022
NCIA Deputy Director of Communications Bethany Moore checks in with what’s going on across the country with the National Cannabis Industry Association’s membership, board, allies, and staff. Join us every other Thursday on Facebook for NCIA Today Live.
NCIA’s 7th Annual Cannabis Business Summit & Expo Highlights
New Experiences, Fresh Perspectives, and Best-in-Class Content
We at NCIA would like to take a moment to thank our members, partners, and sponsors, as well as so many new faces in the cannabis industry, who attended and supported our 7th Annual Cannabis Business Summit & Expo, December 15-17, 2021, in San Francisco. As we reflect on this successful three-day event, several key elements stand out as high points to remember.
“In a word: amazing. I am truly amazed at the show of support from cannabis leaders from across the country,” says Aaron Smith, Co-Founder and CEO of NCIA. “Attendance exceeded expectations, and never have we hosted such an esteemed group of speakers and exhibitors on the leading edge of this booming sector.”
In keeping with our reputation for best-in-class content, we presented a comprehensive educational agenda, featuring two high-profile keynotes. On Thursday, December 16, the General Session opened with NCIA’s update from Washington, D.C. Thereafter, San Francisco Mayor London Breed delivered an inspiring welcome address.
“I’d like to thank NCIA for welcoming me to the stage and for hosting their annual Summit here in San Francisco,” said Mayor Breed. “Their events help advance our industry in a myriad of ways across social equity, policy, and other important issues, while helping connect industry leaders from across the globe.”
Thursday’s keynote showcased Troy Datcher, CEO of The Parent Company in a candid fireside chat with MARY Magazine founder Adrian Farquharson, covering his work to make an impact in the cannabis industry. Our second keynote on Friday, December 17, gathered professional athletes Calvin Johnson, Jr., Rachael Rapinoe, Anna Symonds, and Marvin Washington, for an engaging conversation surrounding the headline-making intersection of cannabis and sports.
“High school athletes are 50 percent more likely to abuse and misuse opioids,” said Rachael Rapinoe, former professional soccer player and Co-Founder and Chief Executive Officer of Mendi. “We need to discuss this massive issue and look to cannabis and hemp as alternatives. My hope [is to] spark those conversations across the industry and help these high school or collegiate athletes, who are just so susceptible to opioid abuse, to look to this space for solutions.”
Last, but certainly not least, we must also emphasize the quality content featuring 100+ NCIA members and supporters who facilitated educational breakouts covering an array of issues facing the cannabis industry, the anticipated CannaVest West Investment Forum, as well as the International Cannabis Bar Association (INCBA) Program, which completed our exclusive content line-up.
This event also marked the debut of BLOOM: A Brands Experience, showcasing an exciting new pavilion in which attendees were able to see, touch and smell cannabis products for the very first time at our signature event. This, in addition to hundreds of exhibitors from the entire cannabis ecosystem, allowed attendees to explore the latest technology, products, and services from seed to sale.
In closing, NCIA is honored to have hosted an event that encouraged exploration and provided valuable education while facilitating the growth of cannabis businesses across the country in the coming year. Please save the date for our 8th Annual Cannabis Business Summit & Expo, July 20-22, 2022, at the Moscone Center in San Francisco. We’ll see you again soon!
2022 and Beyond: Lobbying Congress with NCIA Evergreen Members
by Madeline Grant, NCIA’s Government Relations Manager
Founded in 2010, the National Cannabis Industry Association is the oldest and largest trade association representing legal cannabis businesses. Our membership consists of hundreds of forward-thinking businesses and tens-of-thousands of cannabis professionals from coast to coast. That being said, our work and effectiveness in cannabis policy reform continues to be one of the most important duties at NCIA. During the pandemic, NCIA’s government relations team continued to work to support congressional offices through education and conversation. As we continue to be effective on Capitol Hill, our lobbyists work closely with NCIA’s Evergreen roundtable to effectively shape policy reform.
Due to Evergreen members’ investment in shaping policy for the cannabis industry, we are able to take our Government Relations work to the next level. This month, we will be hosting our first ever Virtual Mini-Lobby Days, taking place the week of January 31. As we continue to represent a value-driven, responsible industry, our main goal is to educate congressional offices on all aspects of cannabis policy reform; social equity, banking, 280E, scientific data, and much more. I want to thank our Evergreen members for supporting our policy agenda.
Let’s take a look at some policy goals in 2022:
You’ll remember that during the 116th Congress, the SAFE Banking Act became the first cannabis-related bill to be passed by a chamber of Congress. It also became the first piece of cannabis legislation to pass the 117th Congress in April of 2021 by a vote of 321-101. Since last spring, the bill has languished in the Senate due to disagreement over enacting comprehensive versus incremental reform.
This year, expect pressure on the passage of SAFE to increase. While efforts to enact comprehensive reform continues, the votes are simply not there as of now. If you’re interested in learning more about this conundrum, take a look at this piece that the Brookings Institute recently posted.
NCIA is continuing to build support for the SAFE Banking Act in the Senate, but some big news was announced recently that will certainly impact the legislation in the future: longtime champion and lead sponsor, Rep. Ed Perlmutter (D-CO), just announced that he will not be running for re-election next session. Rep. Perlmutter spoke to Colorado Public Radio this month about his decision not to run for reelection this November and his disappointment that, while the House has approved the Secure and Fair Enforcement (SAFE) Banking Act five times now in some form, the Senate has failed to advance it under both Republican and democratic leadership. The congressman says that he’s going to work to pass his marijuana banking bill before his time on Capitol Hill comes to an end.
There are numerous bills that have received much attention in terms of descheduling cannabis – among them the MORE Act (H.R. 3617), the States Reform Act (H.R. 5977), and the discussion draft (not formally introduced) of the Cannabis Administration and Opportunity Act (CAOA). Please read my colleague’s blog HERE for more detail.
As we continue to discuss comprehensive legislation with Capitol Hill offices, our main focus is to continue to be a resource when these offices have questions or concerns. It is imperative that NCIA remains in conversations as language is analyzed and discussed. As we work with NCIA members and our Evergreen roundtable, we continue to relay the burden of federal prohibition and how it impacts our businesses and communities.
How can you do more as an NCIA member?
There are ways for you to be more active as an NCIA member. For example, you can consider applying to be on one of NCIA’s committees this summer. As a committee member you’ll work alongside other cannabis professionals as thought leaders to develop industry standards. Some of our committees include: Education committee, Retail committee, Hemp committee, State Regulations committee, Diversity, Equity & Inclusion committee, and many more.
If you are a larger company looking to make a meaningful investment in NCIA’s government affairs work, there is the opportunity to join our Evergreen Roundtable. For more information or a consultation feel free to email Madeline@TheCannabisIndustry.org. Stay tuned for policy updates from our Government Relations team.
Member Blog: Expanding into New Cannabis Markets
by Jennifer Spanos, VP of Product and Vertical Strategy at CannaBusiness ERP.
According to Grand View Research, Inc., the global legal cannabis market is expected to do two things: Reach USD 70.6 billion by 2028 and expand at a CAGR of 26.7% from 2021 to 2028. Support for federalizing cannabis and increased sales—during a global pandemic and a recession—have transformed the cannabis industry’s status as that of a relative newcomer into that of a seasoned player. As new markets begin to emerge, cultivators and processors are eyeing the possibility of becoming multi-state operators (MSOs).
The Who, What, Where and When of Expanding in New Cannabis Markets
Anyone ready and willing to take on the complexities of a cannabis-related business is welcome to do so. However, there are challenges. Investopedia provides a list of these challenges, including (but not limited to) competing against other more established industries, such as alcohol and tobacco, that are joining the fray; facing the stigma of selling, producing, and distributing a newly legalized drug; and complying with the differing laws on legality, use, distribution and growth in states.
If someone is ready to take the plunge, the guide offers a list of 10 states MSOs should focus their attention on, such as Nevada, New York, and Pennsylvania. It also highlights the pros and cons of each state’s legalization efforts. For example, here’s what it says about New York, which legalized adult-use cannabis this year:
“With adult-use cannabis officially legalized in the state as of March 2021, the New York market is predicted to be one of the biggest to watch for over the next few years. Sales in the state are expected to begin in 2022 and huge growth is expected in both the recreational and medical cannabis markets.”
For existing large-scale cannabis companies, these states represent expansion opportunities. To expand, they need to get a new license or acquire an existing cannabis company. Or do both.
However expansion occurs, challenges and benefits exist. For instance, a challenge for companies securing new licenses is the need to set up brand-new operations and production processes.
“Even if an MSO is successful in another market, rules around taxes, packaging, and serial numbers vary from state to state, so new business practices will likely have to be built from the ground up,” the guide notes. “On top of this, MSOs vying for new licenses will also need a mother plant, seedlings, equipment, people, and more to get the business off the ground.”
A benefit for companies going through the acquisition route is that they are acquiring a company that has licensing in place and has established processes for state rules and regulations.
Irrespective of expansion benefits and challenges, cannabis companies looking to successfully manage their businesses must implement cannabis business management software.
The ‘How To’ of Successfully Expanding Into New Markets
With cannabis ERPsoftware, MSOs can juggle multi-site, multi-company, and multi-state requirements. But, as the guide cautions, they need to realize that not all ERP solutions have the width and depth of functionality that is needed to support MSO expansion. MSOs’ research and evaluation process should lead them to a full-scale, true ERP software solution that operates as a single, unified system.
The right cannabis ERP software provides finance, operations, and seed-to-sale capabilities. Here are some featural highlights to consider:
Costing
Compliance reporting
Recall management
Inventory control
Multi-company features
Traceability
Robust Business Intelligence (BI) functionality
MSO cultivators and processors also should look for cannabis software that is flexible and adaptable to the changing needs of an expanding business, implementing only the features they need for their business now. As an MSO expands, such as adding a cultivation operation or purchasing an edibles manufacturer, the cannabis software’s built-in functionality will make it a seamless endeavor.
Jennifer Spanos is the VP of Product and Vertical Strategy at CannaBusiness ERP. She has 14+ years of experience in cannabis and food manufacturing software and operations, working to maximize the efficiency and profitability of customers’ businesses.
CannaBusiness ERP is a solution built in Sage X3 and delivered by NexTec industry experts. Over the past 25 years, their ERP and business process experts have helped organizations across North America streamline business operations and lower costs. Specializing in developing solutions for the cannabis cultivating and processing industry has resulted in some of the most respected cannabis companies around the world managing their day-to-day operations and delivering products off of the CannaBusiness ERP platform. CannaBusiness ERP by NexTec is the go-to answer for cannabis cultivators and processors seeking a software platform built to help you grow.
NexTec’s CannaBusiness ERP is the specialized solution for cannabis companies looking to grow. Contact us today to learn more about it. We’d love to chat.
Learn More About the Cannabis Industry and Cannabis ERP Software
Equity Member Spotlight: Raina Jackson – Purple Raina Infused Self Care
NCIA’s editorial department continues the Member Spotlight series by highlighting our Social Equity Scholarship Recipients as part of our Diversity, Equity, and Inclusion Program. Participants are gaining first-hand access to regulators in key markets to get insight on the industry, tips for raising capital, and advice on how to access and utilize data to ensure success in their businesses, along with all the other benefits available to NCIA members.
Tell us a bit about you, your background, and why you launched your company.
I am an Oakland-based hemp CBD & cannabis brand strategist, product developer/educator, and cannabis industry advocate who recently became a member of the NCIA DEI Committee.
I am a Black “urban hippie” born and raised in San Francisco’s Haight Ashbury neighborhood who earned a B.A. with honors from Stanford University in cultural anthropology and sociolinguistics as a first-generation graduate and an MBA from the NYU Stern School of Business.
A product junkie with over 15 years of experience in sales/marketing management, personal care product development, and education. I have worked in the cannabis industry in sales management, distribution, and field marketing since 2015 and have been a Verified San Francisco Cannabis Equity Applicant seeking a cannabis business permit and license since 2018.
PURPLE RAINA Self Care is the culmination of my personal and professional passion for self-care products, the color Purple, and the artist Prince. Prior to entering the cannabis industry, I worked for top NYC beauty/personal care companies Maybelline and L’Oréal Professional, trained at the Vidal Sassoon school in London, and taught cosmetology at The Aveda Institute in SOHO NYC.
Upon returning to the San Francisco Bay Area in 2013, I became enamored with cannabis dispensaries and the local cannabis culture. While waiting for my permit, I decided to offer a hemp CBD version of PURPLE RAINA to show proof of concept, gain market feedback, and to promote the benefits of hemp CBD to a broader audience. The THC:CBD version will be launched in mid 2022.
What unique value does your company offer to the cannabis industry?
PURPLE RAINA Self Care offers topical infusions that soothe sore muscles and joints, nourish the skin from head to toe, and pamper the senses with aromatherapy. PURPLE RAINA Self Care promotes “mindful self-care and grooming” and seeks to appeal to our collective humanity focusing on our common need for daily grooming and self-care on a physical, mental, and spiritual level.
PURPLE RAINA offers a fresh approach to the category through multi-purpose infused topicals that will serve a range of self-care and grooming needs from head to toe, regardless of gender. Most topical products addressing pain relief overlook daily skin/hair care, personal grooming, and aromatherapy. Many have unpleasant odors and can be irritating to sensitive skin. I created PURPLE RAINA for people like me seeking to moisturize dry/sensitive skin and to soothe sore muscles with aromatherapeutic plant-powered products free of allergens and artificial ingredients.
PURPLE RAINA will eventually employ people from the community. I plan to recruit a “Purple Posse” of brand ambassadors who will conduct impactful in-store product demonstrations for consumers and retail staff. The “Purple Posse” will earn income and gain valuable sales presentation skills training.
What are some lessons learned from the beauty industry that you brought into your cannabis business?
My career has more recently reached the intersection of beauty/personal care and cannabis products. I recently learned that some of the largest cosmetic/personal care companies in the world are now incubating emerging brands instead of regarding them as competition to be squashed or absorbed. Some are being groomed for future acquisition but not always anymore. It’s a more mutually beneficial business relationship.
These beauty behemoths realize the importance of an ecosystem of high-end products, mid-priced and value brands, mature institutional brands, and young indie/niche brands readily available online and in stores. It best serves the customer when they have multiple quality choices at a range of price points. These companies are also assuming their corporate responsibility to the industry and society. They are abstaining from unfair competitive tactics aimed at eliminating competition from emerging brands.
What is your goal for the greater good of cannabis?
The cannabis plant, as a metaphysical healing force, deserves to be represented by an equitable accountable industry under a new breed of conscious compassionate capitalism valuing Profit & People / People & Profit like Yin & Yang.
During the 2021 Meadowlands conference/retreat at Camp Navarro, CA, surrounded by majestic redwood trees, I imagined the notion of a relationship between big trees and little trees as an analogy for cultivating an equitable cannabis ecosystem where little trees can still thrive to grow among the big trees, some eventually becoming big trees themselves. Imagine if big trees could share the nutrients in their roots with neighboring little trees, as a metaphor for how corporate financial, technical, and educational resources could be redirected to help benefit emerging equity and legacy businesses. This doesn’t exist in nature but imagine the social and financial impact it would have on so many who have been systematically excluded and discriminated against, as well as on those who contribute these resources.
What kind of challenges do you face in the industry and what solutions would you like to see?
Challenges: I face financial challenges like so many other cannabis entrepreneurs. Yet this is compounded as a Black woman, a member of an underestimated undervalued group that is underrepresented as cannabis business executives and owners. We receive the lowest amount of investment funds across industries due to racism and sexism, though we are the fastest-growing group of business owners in the U.S. and tend to be successfully bootstrapped and financially savvy.
Additionally, there is a big disconnect in current equity programs between the criteria to qualify and the financial resources and business acumen necessary to succeed if you don’t have access to investors and sound cannabis business and legal advisors. Late in the game, I was even told that I didn’t need a cannabis license to make my products and can just hire a manufacturer to produce them under their license. This is a viable option initially to go to market but not long-term. I would have wasted significant time and money and missed the whole point if I abandoned the pursuit of my own license. Also, as a brand of customized topical formulations manufactured by contract manufacturers, my rare business model tends to be overlooked by local and state cannabis regulations. For example, it took a few years and forfeited application fees for the type 13 transport only/self-distribution license I now seek to be introduced, representing the only feasible path to licensure and the only way I could go to market, other than the type-S shared license which doesn’t work for me.
Solutions: As part of a corporate responsibility mandate, successful profitable cannabis businesses along the supply chain, MSOs, and future alcohol and tobacco corporations entering the industry should make contributions into a Cannabis Equity/Legacy Fund collected by state licensing agencies and administered by an industry non-profit like the NCIA or a group of B-corps operating in the highest integrity. These big trees would contribute financial resources and access to key technical services as part of their platinum “industry membership fees,” a standard cost of doing business. In the same way their license fees are proportionate to projected revenue, their contributions into the fund would be proportionate to recent and projected revenue.
Our allies are instrumental in helping those who are resistant or just don’t know what to do to recognize their responsibility to use their privilege for the greater good, ultimately benefiting all parties’ bottom lines and corporate morale. There’s no need for guilt or blame, just empathy, goodwill, good works, and collaboration to help undo historic wrongs over time.
I want to see U.S. cannabis legalization soon with equity and anti-monopoly policies already in place. The cannabis industry should under no circumstances become fully dominated by oligarchies/monopolies like the early telephone and utility companies that had to be split up or even the current social media and tech giants under scrutiny. This policy should demonstrate recognition of the value DEI and BIPOC partners bring to the cannabis industry along the entire supply chain. Government solutions would include SBA grants and forgivable PPP-like loans like any other industry receives.
Why did you join NCIA? What’s the best or most important part about being a member through the Social Equity Scholarship Program?
I always wanted to join the NCIA since I attended an annual conference years ago but couldn’t afford it. The best part of being a member through the Social Equity Scholarship Program is the weekly Zoom call held by Mike Lomuto for equity cannabis entrepreneurs and allies nationwide. We check in to discuss our triumphs and challenges and share valuable business insights and ideas for building a more equitable cannabis industry. These calls inspired me to apply for the DEIC and to intensify my cannabis equity advocacy and thought leadership.
Video: NCIA Today – January 13, 2022
NCIA Deputy Director of Communications Bethany Moore checks in with what’s going on across the country with the National Cannabis Industry Association’s membership, board, allies, and staff. Join us every other Thursday on Facebook for NCIA Today Live.
2022: A New Year In Cannabis – What To Watch
Photo By CannabisCamera.com
by Michelle Rutter Friberg, Deputy Director of Government Relations
With the start of 2022 also comes the final year of the 117th Congress. Last year was marked with some small victories, although meaningful cannabis reform has yet to be enacted on the federal level this session. While it’s a midterm election year, I have no doubt that we’ll see some significant movement over the coming months. Keep reading to see my answers to some of your FAQ’s for the new Congress:
What’s going on with the SAFE Banking Act?
You’ll remember that during the 116th Congress, the SAFE Banking Act became the first cannabis-related bill to be passed by a chamber of Congress. It also became the first piece of cannabis legislation to pass the 117th Congress in April of 2021 by a vote of 321-101. Since last spring, the bill has languished in the Senate due to disagreement over enacting comprehensive versus incremental reform.
This year, expect pressure on the passage of SAFE to increase. While efforts to enact comprehensive reform continues, the votes are simply not there as of now. If you’re interested in learning more about this conundrum, take a look at this piece that the Brookings Institute recently posted.
NCIA is continuing to build support for the SAFE Banking Act in the Senate, but some big news was announced this week that will certainly impact the legislation in the future: longtime champion and lead sponsor, Rep. Ed Perlmutter (D-CO), just announced that he will not be running for re-election next session.
What’s next for comprehensive cannabis reform? Is legalization on the horizon?
There are numerous bills that have received much attention in terms of descheduling cannabis – among them the MORE Act (H.R. 3617), the States Reform Act (H.R. 5977), and the discussion draft (not formally introduced) of the Cannabis Administration and Opportunity Act (CAOA).
Back in the 116th Congress, the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act became the first piece of comprehensive legislation to pass the House of Representatives by a vote of 228-164. More recently, the MORE Act passed out of the House Judiciary Committee in September 2021 by a vote of 26-15. While this is certainly news to be celebrated, the bill has been referred to another eight committees of jurisdiction and faces a more conservative chamber overall than last session for full passage.
The States Reform Act is a newer piece of legislation that was introduced in the House by freshman Congresswoman Nancy Mace (R-SC). The bill deschedules cannabis, regulates it through ATF/TTB for cannabis products and FDA for medical use, and institutes a 3% federal excise tax on products to fund law enforcement, small business, and veterans mental health initiatives. Many have lauded the pro-business elements of the bill, however, additional provisions must be added to address equity and restorative justice. It’s unlikely that the bill will move this Congress for partisan reasons – particularly during an election year.
As for the Senate-led CAOA – there are too many unknown elements to make any real predictions! Senate Majority Leader Schumer (D-NY), Finance Committee Chairman Wyden (D-OR), and Sen. Cory Booker (D-NJ) outlined their plans for the CAOA in February 2021, unveiled the text in July 2021, with comments due by September 1 (make sure you check out NCIA’s response!). Due to the sheer magnitude of input received, the never-ending pandemic, and other legislative priorities, official language still has not yet been introduced. NCIA continues to work with the sponsoring offices on the CAOA and anticipates introduction in the spring.
What’s going to happen at the committee level?
If you’re following cannabis policy at the federal level, definitely keep your eyes on what’s happening in various congressional committees. Given that there were few cannabis-related hearings and markups in 2021, I’m hopeful that there will be more this year. I’ll specifically be keeping my eye on both chambers’ appropriations, financial services, tax, and judiciary committees.
Midterm elections will be here before we know it, but NCIA is continuing to keep the pressure on our elected officials to reform our outdated cannabis laws. Want to learn more about what’s possible? Make sure your company is an active member of NCIA and register for our next webinar, check out our podcast, and hop on over to NCIA Connect to chat with us and learn more about what we’re working on in D.C.!
by Wendy Barr, CEO & Creative Director, Barrcode Branding Member of NCIA’s Packaging and Labeling Committee
You want “that” package, the one that is flying off the shelves; the one that people photograph and post on social media; the one that makes the consumer feel something inside, something special, maybe even emotional. Maybe it’s a package they keep, reuse, save, share, and purchase over and over again.
If you’re in retail, you want a package that earns you shelf space. A package that retailers want at eye-level in their stores and dispensaries, featured on their website, in their app, directly in front of the consumer… tantalizing, educating, and urging them to purchase. Admit it, you have an amazing product, and you want irresistible packaging design!
What does all gorgeous packaging have in common?
YES!! Branding!
Cool, you have been listening…
Yes, it’s true, we’re extremely passionate about packaging design (and branding). That’s why we’ve committed our professional life to the packaging design industry. We want to understand why a consumer is compelled to purchase one package over another. What makes this package so hypnotic and desirable? We want the graphics, colors, messaging and overall design to appeal to something deep inside of the discerning adult consumer. It’s our goal to create a personal connection that expands beyond the product itself. The packaging is more than a mere vehicle. It should hold the sale, inform, and delight the consumer.
Did you know that packaging design is one of the last sustaining manufactured print products?
Think about it. Magazines, books and literature, posters, flyers, brochures, album covers (yes, I remember vinyl), even business cards are on their way out. But, product packaging is here to stay. It can’t be purely ‘digital’; the product has to go into something for transport, storage, information, and more.
Your packaging is a billboard that represents your entire brand.
Your branding will dictate the look and feel of your packaging, and the language used to communicate the product’s value to the consumer.When you get this part right, you can experience huge rewards. But if you get this wrong, you may never get a second chance. Ouch, that stings…
Many businesses get this wrong, especially those in newer industries like the legal cannabis, CBD, and hemp industry, for example. Some companies opt for a white label product and simple packaging design created by the white label company. Or they print their own labels using their DIY logo and wonder why it’s not selling. It’s a great product, tried and true, but the packaging doesn’t communicate the brand value to the consumer effectively resulting in #epicfail.
Why focus so much energy on Brand Driven Package Design?
If the goal is to be visible, popular, and profitable, your product packaging can’t be an afterthought. Your branded product packaging is part of the big picture. It’s functional marketing and should be treated as such. Keep it simple, clean, and on-brand, and you can’t go wrong. You got this!
Here is your mini cheatsheet:
Branding (need I say more?)
Your spot-on brand identity comes first, it has to, because your packaging design is a reflection of your brand. The logo, colors, fonts, imagery, and language must be indicative of your unique differentiation as a brand.
Sustainability (it’s time to save the planet!)
Make sure that your packaging materials reflect your brand values and mesh with the product. Sustainability issues and concerns are critical due to the potential negative impact on the environment. Consider recycled and/or recyclable materials, and work with regulators and lawmakers to improve access and feasibility.
Primary vs. Secondary Packaging (what does it all mean?)
Primary packaging is what directly holds and contains the product (like a bottle). Secondary packaging is the exterior packaging (like the box that holds the bottle) that protects and/or labels the product. Tertiary packaging is used for bulk handling, storage, and distribution.
Specialty Design Agency (can you say branding?)
Choose an agency that is or has worked closely with you on the development of your brand. A professional agency will have designers with expansive knowledge regarding packaging design, print production, branding, and marketing. Your packaging design, website, and marketing efforts must be intrinsically and cohesively linked to your brand identity.
Wait, maybe white label or private label would work for you. But, in that case, is branding still a valid concern?
I’m so glad you asked! White labeling is hot and trending in the cannabis industry. But, is it right for you? Let’s take a look…
What are White Label Products?
White label products are mass produced by a manufacturer as a generic product, and sold to a retailer who will in turn add their own label and sell it under their brand name. The formula is standard and typically, cannot be customized. So, the only thing that you can customize is the branding, packaging design and brand marketing.
What are Private Label Products?
Private label products are produced by a manufacturer as well, but in partnership with the brand to create a unique formulation. It is a longer, more expensive undertaking, but it results in an exclusive product. Retail brands use this to differentiate their products and cater to their niche audience.
White Label vs. Private Label
How do business owners decide which is the best investment for them? Well, it’s important to weigh the price differential. White labeling is more affordable, but the product is not original. Private label requires a more substantial investment, but it allows for collaboration, flexibility, and exclusivity with regards to formulation, and in some cases, trademarking and market share. But, unless you have a loyal, expansive customer base and exceptional branding/marketing, it could be difficult to compete against established, well-known brands.
What is exactly the same?
BRANDING! In the end, no matter the direction you choose, a white-label product or a private label, the only way to optimize your visibility and assure that your product stands out is branding. Having professional, eye-catching branding, a spot-on brand story and a unique branded marketing strategy can earn you distribution, shelf space, and loyal customers now and in the future.
Short story long, if you are in this to win this, do it right the first time! Make it custom, make it YOURS!
NCIA’s DEI Program New Year Update
by Mike Lomuto, NCIA’s DEI Manager
We must not let federal legalization become the “War on Drugs 2.0.” Rather, it must be the foundation for the building of generational wealth.
The modern-day cannabis industry is the product of a century of prohibition and the war on drugs. With federal legalization fast approaching, it is up to us all to ensure that this industry does not become the “Drug War 2.0.”
At the National Cannabis Industry Association, we recognize the importance of impactful Diversity, Equity, and Inclusion initiatives.
At the core of our DEI Program is our Equity Scholarship Program (ESP). Launched in 2020, nearly 200 ESP members are enjoying the benefits of a complimentary first year of NCIA membership thanks to this program and its financial sponsors.
Equity Scholarship Program Features
Complimentary passes to all NCIA events
Live Social Equity Workshops at our national conferences
Weekly video conference calls
Facebook community
Catalyst Conversation Educational Webinars
Unique Opportunities for ESP Members to Leverage NCIA’s Platforms
Greater representation on NCIA panels and webinars
“Being part of the program has transformed our company. The mentorship we’ve received has been instrumental in our growth. Being part of NCIA provided opportunities for us to gain new business relationships, become committee members, and participate in webinars. It’s also been great meeting other social equity members and building a community together.” – Kay Villamin, Hush Chicago, NCIA’s State Regulations Committee
As a trade association, at the core of NCIA’s mission is to create industry-shaping policy advocacy. Our Diversity, Equity, and Inclusion Program is ensuring that diverse voices are properly integrated into that advocacy, including:
Launching NCIA’s Sustainability Collaboration, in collaboration with several dedicated NCIA Committee Leaders, with an emphasis on incorporating the DEI perspective, which is too often left out of the sustainability conversation
A new Health Equity project in development
Of course, Diversity, Equity, and Inclusion would be meaningless unless we see that greater representation plays out on our biggest stages and in our board rooms.
NCIA has one of the most diverse boards of directors in the industry, including members who joined NCIA through our Social Equity Scholarship Program
Increasingly diverse representation across the leadership of NCIA’s fourteen sector committees
Consistently inclusive representation on panels – live and virtual. The overwhelming sentiment at our recent Midwest Cannabis Conference in Detroit was that it was “the most diverse and inclusive conference” many speakers and attendees had ever experienced
“I’m a firm believer that the more you give, the more you get, and my experience at NCIA is proof of that. Becoming a scholarship member at NCIA as a woman and minority founder has been an incredible opportunity… Committee work has rewarded me with new perspectives, recognition, and invaluable relationships that have strengthened my business.” – Helen Gomez Andrews, Co-Founder & CEO, The High End; Committee Organizer, DEI Committee
“The Scholarship Program gave way more than we could ever ask for. As a veteran and minority-owned company, with a core focus on community impact through cannabis, we have been provided with important opportunities and resources. The program is holding the door open for others like us to enter into the industry. You will not regret being a part of the Social Equity Scholarship Program.” – Keyston Franklin, The Doobie Room; Vice Chair, Banking Committee
As we continue to build for the integrity of the industry and future generations, we are looking for partners to join us.
Equity Member Spotlight: Better Days Delivery Service
This month, NCIA’s editorial department continues the monthly Member Spotlight series by highlighting our Social Equity Scholarship Recipients as part of our Diversity, Equity, and Inclusion Program. Participants are gaining first-hand access to regulators in key markets to get insight on the industry, tips for raising capital, and advice on how to access and utilize data to ensure success in their businesses, along with all the other benefits available to NCIA members.
Tell us a bit about you, your background, and why you launched your company.
I grew up in Colorado Springs in a single-parent home, overcame poverty, violence, houselessness, and a felony for marijuana possession to get to the place that I am in today. I’ll never forget the immediately depressing feeling of knowing that I’d lost opportunities, let my mom, my family, and my community down when initially being charged with a felony for marijuana distribution. Thankfully my people reminded me that I am much more than this scarlet letter F represents. I did my time, paid my restitution, and kept on grinding. Now a father of two beautiful babies, their presence is a constant reminder that I can’t give up. Left out of the weed industry, I focused on community and education as a 5th grade teacher. I decided to leave the classroom to start this business because I wasn’t happy due to the politics and wasn’t feeling valued in my career. I have worked hard to break out of the cages/boxes that I was placed in. I have been turned down for housing, employment, and have had doors closed because of this felony but I keep the belief that when one door closes another opens and because of that I’m determined to succeed. The weed industry seems much more of a fit for me, I chose delivery because it was the easiest point of entry however I dream of one day being vertically integrated.
What unique value does your company offer to the cannabis industry?
Our company, Better Days Delivery Service, offers a community aspect that is sorely missing in the industry. In my opinion, most of the industry hasn’t done their due diligence to truly serve and build relationships with patients. We have partnered with the nurse network so that they are able to give true medical advice while we work on the discreet, quick, personable service that we have become known for. Safe, affordable, discreet service is mandatory, we offer luxury and frequent flyer convenience as well. By focusing on the customers that are often overlooked, I am confident that we can provide a service that will revolutionize all of the industry. We want to deliver weed with the personable service that existed before the industry existed, I want to remind people that it’s still possible. Who wouldn’t love a delivery company that reminds our customers that our worst days are behind us? “Better Days Are On The Way.”
What is your goal for the greater good of cannabis?
In the words of 2Pac, “better days got me thinkin’ ’bout better days!” My goal for the greater good of cannabis is to remind people of the healing aspects of the plant. I want to help free everyone that has been incarcerated or charged for anything to do with the plant. I want to contribute to scientific research that will help heal and help people live despite their ailments. I would love to see it totally decriminalized and if I am able to pay my bills and make it better for my family in the process even better!
What kind of challenges do you face in the industry and what solutions would you like to see?
Michael Diaz-Rivera
The biggest challenge that I have is a lack of capital both financially and socially. It is not cheap to get into the industry and I have been bootstrapping and using my savings thus far. Having access to all of the money that I would need to reach my dreams and create generational wealth would be perfect. I’ve also noticed that in this industry, it pays to know people as a social equity licensee. I feel like the majority of the industry looks at us as if we’re begging for scraps. Because of that, I’ve worked to build relationships with powerful people who have a true commitment to equity and support for those who have less.
I’ve also begun the steps to make my business a social enterprise. The true challenge in being a business that works for social good will be to find a balance between profit, sustainability, and social impact. I aim to do exactly that!
Why did you join NCIA? What’s the best or most important part about being a member of the Social Equity Scholarship Program?
It was important for me to build a network and NCIA is just the trade organization to help me do that. NCIA has been a platform that helps me get into the doors that I usually wouldn’t be able to access. I am able to ask important questions about the development of my business to those with answers. The social equity program allows me to chat with those from similar upbringings while sharing the tools and resources to help us all succeed. The most valuable part has been the sounding board and emotional support that the group continues to provide.
As a nation, we have to be accountable for the “war on drugs” as everyone turns their eyes toward federal legalization. Without accounting for the harm that continues we’ll never get to the “better days” that the people deserve.
Member Blog: How a Better Understanding of Data Can Propel Cannabis Companies
Propelled by new legalization easing the regulations and laws surrounding its use and distribution, the nascent cannabis industry has experienced unparalleled growth. Expected to expand at a CAGR of 26.7% from 2021 to 2028, the market is loaded with potential for up and coming businesses.
However, to realize this potential and maximize one’s ROI requires a thorough understanding of the industry and the flexibility to evolve with the market. Thankfully, the recent legalization of cannabis in many states has spurred a significant increase in available data for organizations to use in facilitating their decision-making.
Understand key market trends
Lacking a mature market history due to cannabis just recently being legalized, businesses within the cannabis industry can’t reflect on previous purchasing trends in strategizing their approach to consumers. Whether or not a product experiences success largely depends on it being positioned in the right market segment.
By leveraging transactional data based on a variety of factors (demographic, seasonality, delivery method, etc.), organizations can identify which products are selling and who they’re being sold to. The wide diversity of both available strains and consumer demographics means there is no one-size-fits-all solution to cannabis.
Additionally, the cannabis industry’s young age and heavy investment in product innovation has produced a relatively volatile market. Businesses have to be able to quickly adapt to the always-evolving consumer trends if they’re to remain successful.
Utilizing data in their decision-making can also aid executive administrators in creating long-term business strategies and identifying realistic goals.
Identify opportunities for improvement
Many organizations still guide their decision-making based on factors like gut feelings and prior experiences, which are prone to error and often fail to address the underlying causes in any given situation. Without access to the right metrics, it can be very difficult for both young and mature businesses to identify weak points in their enterprise.
Hidden in the data are countless opportunities for improvement from product design to customer processing. Organizations need a way to transform their data’s potential into meaningful insights if they’re to successfully scale their business.
Comprehensive data analytics systems are capable of employing automated business rules to generate useful metrics for determining what steps an organization needs to take to grow its enterprise. Many platforms come with a host of built-in KPI measures as well as self-service features that allows users to define their own business rules custom-tailored to their businesses’ needs. This means that organizations can apply analytics in a manner that best suits their own unique circumstances.
Comply with regulatory policies
The complex legal status of cannabis has led to an extensive list of regulations and laws that must be abided if the industry is to experience any long-term sustainability. Even in regions where cannabis has been legalized, governing bodies still maintain strict requirements in terms of product quality and distribution. Many of these challenges are only complicated by the fact that the different regions a business operates in all have their own set of unique rules.
Because most of these requirements are monitored and enforced through data collection systems, businesses have to implement a reliable analytics platform that can track product data all the way from cultivation to retail. In addition to handling information governance on an organization’s behalf, enterprise data solutions also employ automated features to mitigate the penalties incurred from human error.
Furthermore, by reducing the employee labor costs associated with ensuring regulatory compliance, businesses can free up time and energy for staff to focus on other business functions.
Optimize supply-chain operations
Supply chains, regardless of industry, have always depended on data to guide the transportation of products and ensure that inventories always reflect market demand. However, the short shelf-life and complex regulations of cannabis has made it even more critical that businesses turn to comprehensive analytics platforms.
Due to the volatile nature of the cannabis industry, businesses need real-time data reporting that can allow them to adapt to the always-evolving market trends quickly and efficiently. Every level of the supply chain is prone to a variety of risks and potential obstacles that businesses must be able to respond to at a moment’s notice. The ability to address a minor setback before it turns into an emergency can have profound implications for both the short- and long-term success of a business.
Outside of responding to potential accidents, data analytics can also optimize the more general functions of the supply chain and increase a business’s ROI. By coordinating schedules, maxing cargo loads, organizing inventories, and addressing other potential areas of weakness, businesses are able to reduce wasted time and resources.
John Kievit is Dimensional Insight’s Vice President of Goods and Services, Industry Strategy, and Business Development. In this role, Kievit helps Dimensional Insight understand customers’ needs and their use of its products. Kievit has nearly 40 years of experience in such a role, including working as an Administrative Vice President for sales and marketing. In addition, he has handled multi-million-dollar portfolios during his years in the goods and services industry, many of which involved using Dimensional Insight’s products, and spent many years in direct sales management.
Deciding how your organization implements data analytics depends entirely on the needs of your business and what your long-term goals look like. Solutions like Dimensional Insight’s CannaBI provide a comprehensive data governance package and manage your data at every step of the way, from integration to visualization. To learn more about how analytics can help your business grow, check out Dimensional Insight’s webpage on the cannabis industry.
Video: NCIA Today – Friday, December 10, 2021
NCIA Deputy Director of Communications Bethany Moore checks in with what’s going on across the country with the National Cannabis Industry Association’s membership, board, allies, and staff. Join us every Friday here on Facebook for NCIA Today Live.
Member Blog: When Sustainability Comes to Compensation in Cannabis
by Fred Whittlesey, Founder, President, and Principal Consultant of Cannabis Compensation ConsultantsTM
Member of NCIA’s Human Resources Committee
At the NCIA Cannabis Business Summit & Expo next week, there is an all-day workshop on the topic of sustainability. As a member of the NCIA Sustainability Committee, representing the NCIA Human Resources Committee, I have been actively involved in putting this together. While this session will not directly address my specialty, employee compensation, there will be discussion of how broad the idea of sustainability is, and how it permeates every element and every decision in a business.
Not a day goes by that I don’t receive in my inbox one or more blogs, articles, or studies on introducing ESG metrics into executive compensation incentive plans. It’s all the rage. Consulting firms that published opinions only two years ago that this was “not a prevalent practice” and “not consistent with the current corporate governance environment” have been proven wrong.
I have been presenting on this topic, in the context of compensation, since 2014 – in London, Vancouver BC, Los Angeles, San Francisco, Silicon Valley, and Seattle among other places and virtual spaces.
As recently as 2019 we still couldn’t figure out what to call it. CSR, ESG, Triple Bottom Line, etc. These discussions inevitably include reference to Conscious Capitalism as well. I went to my first Conscious Capitalism conference, in San Francisco, in 2013. The key concept of Conscious Capitalism is consistent and balanced treatment of all stakeholders, not just shareholders. Employees, customers, suppliers, the environment, the community.
But the discussions today are primarily about adding ESG metrics to existing executive compensation structures. There’s a lot of greenwashing going on there.
Sustainability is not just about metrics, as essential as good metrics are for measuring progress. Building a sustainable organization is about more than carbon emissions, recycling, water conservation, and biodegradable packaging. Sustainability is a risk management strategy.
A prominent risk factor in every business is people. Not just regulatory enforcement of labor laws, or risk of litigation from discrimination, or wage and hour law violations. Building a sustainable organization is reducing the constant churn of employees, avoiding destructive labor cost-cutting to pacify shareholders while extracting the funds from other stakeholders, and considering social justice goals when deciding how to pay people.
At that first Conscious Compensation conference for me, I was astounded that employee compensation was not mentioned once. Well, one speaker had one bullet point on one slide that said “employee ownership” – that was it. I returned from the conference and trademarked the term Conscious Compensation® because you can’t practice conscious business without considering how you share value with your employees. From the trademark grew a conceptual model and then dozens of conference presentations, gradually sliding in the sustainability theme while avoiding the appearance of a “save the whales” label.
Now it’s the core of my approach to compensation advisory services. I may not call it that, but it’s in there.
It fits perfectly with the ethos of the cannabis industry. If I was a speaker at next week’s Sustainability workshop, I’d be talking about all of this. In the meantime, check out my other blog this week on the session, Cultivating Your Workforce where we will be discussing compensation.
Fred Whittlesey is the Founder, President, and Principal Consultant of Cannabis Compensation ConsultantsTM, a Compensation Venture Group SPC company.
Fred is a member of the NCIA Human Resources Committee and the NCIA Sustainability Committee.
Fred is recognized by corporations, professional organizations, universities, media, and colleagues around the world as a compensation expert and thought leader. His ideas have been presented in numerous book chapters, journal articles, media interviews, conference and seminar presentations, and hosted blog postings.
Fred’s thought leadership in the field of compensation is evidenced by his delivery of more than 300 conference presentations, seminars, certification courses, webinars and podcasts. He has presented and taught in 26 US States, 4 Canadian Provinces, UK, Ireland, France, Germany, Netherlands, Switzerland, Turkey, and Indonesia.
He has authored more than 50 peer-reviewed journal and magazine articles, book chapters, white papers, and sponsored papers. He has been a paid writer for PayScale.com, Salary.com, InvestorJunkie.com, and SeekingAlpha.
Fred has been interviewed and quoted more than 100 times by more than 35 different media sources including Associated Press, Bloomberg, Business Week, Fortune, New York Times, Los Angeles Times, Orange County Register, Seattle Times, San Jose Mercury News, and San Francisco Chronicle. He has been retained to conduct research to support investigative journalism for The Los Angeles Times and The Boston Globe.
Cannabis Compensation ConsultantsTM is a division of Compensation Venture Group SPC, a Washington Social Purpose Corporation. The company is a Green America Certified Business.
The firm specializes in compensation strategy, executive and director compensation, equity-based compensation, incentive design, and employee pay with a focus on sectors driven by innovation. We also provide expert witness and litigation support for civil litigation and regulatory matters. Our clients include Boards of Directors and executive teams of public and private companies, LLCs, S corporations, and foreign subsidiaries.
Our Canadian sibling consulting firm is Conscious Compensation Group Inc. in Squamish, BC.
NDAA Blues, But HOPE On The Horizon
by Morgan Fox, NCIA’s Director of Media Relations
The last week or so has been an interesting one in Congress when it comes to cannabis policy reform, and carried with it the usual mix of positive and unfortunate developments.
First, in yet another installment in the long and ongoing saga that is the SAFE Banking Act’s path toward becoming law, a minor setback. Champion and lead sponsor Rep. Ed Permutter had been working for weeks to get SAFE Banking language included in the NDAA, or National Defense Authorization Act. This spending package is typically focused on security and military matters, and is considered “must-pass” legislation by both chambers. Now, you may be asking what allowing banks to more easily work with legal cannabis businesses has to do with national security, and the answer – oddly enough – is a lot. Beyond the obvious public safety benefits of no longer forcing most cannabis businesses to operate entirely in cash and making them targets for crime, allowing access to banking would dramatically increase financial transparency in the industry. This would give law enforcement additional tools to help prevent the admittedly rare occurrences of criminals extorting legal businesses or using them to launder money, which is certainly a security concern. Perhaps even more relevant, being able to use the financial services that are available to other legal industries would help remove significant barriers to entry into the legal market and allow small cannabis businesses to be more competitive with unregulated operators, some of whom have ties to international drug trafficking organizations that present an ongoing threat to global security.
Unfortunately, Rep. Perlmutter decided not to add the banking language to the NDAA at the urging of Speaker Pelosi in order to ensure the spending package would pass without issue. Despite this compromise, however, Rep. Perlmutter has vowed to attempt to add it to every available legislative vehicle going forward. Given the fact that the Senate is currently stalling on the SAFE Banking Act as a standalone bill, this may be the most viable strategy of getting cannabis banking reform through both chambers before the end of the current Congress.
Speaking of other vehicles for reform, the ongoing appropriations process continues to hold hope for passing a number of cannabis-related items in the near future. Lawmakers recently approved a continuing resolution to fund the government through February and avoid a shutdown. This means that there will be no changes to the previous budget until then, but it does give us more garner support for the provisions that we want to make sure are part of that spending package. That includes preventing the Department of Justice from targeting state-legal adult-use cannabis businesses and programs, SAFE Banking, improving access for veterans, expanding research, and more.
In better news, Reps. David Joyce (R-OH) and Alexandria Ocasio-Cortez (D-NY) partnered up to introduce a bill that would provide federal support for state-level expungement efforts. The Harnessing Opportunities by Pursuing Expungement (HOPE) Act would allocate $20million for a grant program to help reimburse states for the costs associated with expunging non-violent cannabis convictions. This is incredibly important because most of the federal expungement conversation has focused around federal convictions, yet the vast majority of arrests and convictions occur under state laws. Most states lack the resources and infrastructure to effectively address this issue at a large enough scale and in a manner that is affordable to the victims of prohibition who are just trying to clear their records of convictions for behavior that is now legal for a majority of Americans. It is wonderful to see bipartisan support for this important legislation, and we look forward to working with lawmakers to push it through as soon as possible.
That’s all for now, but stay tuned for further updates from Capitol Hill. And don’t forget to register for NCIA’s Cannabis Business Summit in San Francisco next week!
Member Blog: Compensation in the Wild West of Cannabis
by Fred Whittlesey, Founder, President, and Principal Consultant of Cannabis Compensation Consultants
Member of NCIA’s Human Resources Committee
At the NCIA Cannabis Business Summit & Expo next week, there will be a panel session titled Cultivating Your Workforce. As a member of the NCIA Human Resources Committee, I have been actively involved in putting this together, and as a compensation expert, I wanted to ensure there is going to be, of course, a lot of discussion about compensation – executive compensation, incentive compensation, and employee ownership.
It’s appropriate that this month’s #CannaBizSummit is being held in San Francisco, arguably the historical culmination of Wild West culture, with the Gold Rush as its driver. Not unlike today’s cannabis industry – a gold rush of sorts, by federal definition a lawless community, and a community culture of moving fast and defining as we go.
As a compensation expert, I typically prefer a more orderly and well-defined world, which is why I am fascinated with working in the field of compensation in the cannabis industry. It’s challenging because I am in the business of answering clients’ questions about compensation. It’s not always easy to do in cannabis.
There are three factors that explain where we are today in understanding and analyzing compensation levels and practices in cannabis, and three driving forces that will take us from today’s Wild West to tomorrow’s still innovative, still creative, but a bit more business-like approach to compensating employees in cannabis companies.
Today
No valid compensation surveys or databases exist for the cannabis industry. There are various publications that self-label as “surveys” but are merely data compilations missing the rigor of survey methods that have been established over the past decades:
Little or no definitions of jobs
Extremely wide ranges that defeat usability
Reports of cash compensation only, some with base salary only
Very small sample sizes, often not disclosed
No list of participating companies
In short, they’re not compensation surveys. Established survey companies have not entered the cannabis market due to legal and/or stigma factors. They will, eventually. But they’ll be late to the party, so to speak.
For now, we have no real market data. Except for some executive positions…
For executive positions and equity compensation plan design details, data from public company securities filings continues to be the most valid and reliable source
Securities and Exchange Commission EDGAR filings (U.S.)
System for Electronic Document Analysis and Retrieval (SEDAR) (Canada)
Despite currency, cultural, and governance differences, combining U.S. and Canadian data makes sense given the integrated labor market for talent. But it’s no easy task.
Unlike for publicly-traded companies in the U.S., executive compensation information for cannabis companies is difficult to obtain and interpret for multiple reasons:
Most companies are listed on Canadian exchanges
The Canadian disclosure requirements are less rigorous, such as:
Lack of a single table for all forms of executive pay
No dollar value required to be calculated for equity compensation grants
Limited disclosure of the history of equity compensation grants
Companies whose shares are traded in the U.S. are not on major exchanges and not subject to the extensive disclosure requirements of NYSE and Nasdaq companies. This is changing – as exemplified by last week’s listing of the SPAC Canna-Global Acquisition Corp (NASDAQ:CNGLU) on Nasdaq, but SPAC listings have a reduced set of disclosure requirements. (full disclosure: I am an investor in CNGLU.)
Most companies are of a size and status (e.g., Emerging Growth Company) that also have reduced pay disclosure requirements.
So, despite what is a rich source of executive and equity compensation data which we have relied on for decades now, these databases are not (yet) of the same usefulness as for other industries.
And even if we didn’t have those tactical issues… the characteristics of the cannabis industry exacerbate these difficulties:
Smaller companies and private companies
High-growth stage, resulting in the lag time in reporting rendering the information significantly out-of-date
High concentration of founders and insider ownership, which results in compensation levels and practices that are not free-market based – one CEO taking zero compensation and another in the 8 figures.
Top-heavy C-level position structures, e.g., an Executive Chair and a CEO and a President and a COO – too many chiefs
So, the question of how much this company pays its top executives… is an unanswerable question. I wonder if even the company could answer that question?
Tomorrow
The turbulence in executive compensation levels and practices will lessen, and our knowledge and understanding will improve, when three trends converge:
More public companies, including SPAC deals, and continued M&A activity, bring in more outside investors with expectations of corporate governance and practices consistent with other industries in which they are invested. This also will have the effect of lessening the influence of founders as more “professional” (hired external) Board members are added to the governance structure.
With more public companies will come more market data, as we have for most industries today both in the U.S. and Canada. While limited to the top 3 or top 5 executives in each company, these disclosures provide a factual and verifiable dataset for the most senior positions, for the use of equity compensation for employees, and for the breadth of executive compensation arrangements such as new hire packages, severance and change in control agreements, and various perquisites.
And of course, legalization. With the U.S. federal restrictions and the associated stigma removed, cannabis companies will become subject to the same governance, institutional investor and proxy advisor pressures, and the large consulting firms will push them toward the ISS/Glass Lewis “playbook” approach to advising. I’m not saying that’s a good thing, because it’s not, but we already see it happening in Canada where large multinational compensation firms are overlaying the boiler-plate ABCs.
It is my hope that the innovation and creativity we see in the cannabis sector today will not suffer from these three dynamics. There’s nothing wrong with living in the Wild West, if you’re comfortable with fewer rules, fewer constraints, and less transparency. But it helps when there is a Sheriff and a couple of Deputies in town.
This conversation is not limited to executive compensation. Equity compensation for all employees is a common aspiration in cannabis companies. Equity compensation plans are always complex to design, implement, and administer and are exponentially more so in cannabis companies. Complex organization structures with public entities, private companies, LLCs, and even nonprofits all bring talent from diverse industries with vastly ranging experience with and expectations for equity compensation.
A trimmer coming from agriculture or a Dispensary Manager from specialty retail has likely not received equity as a component of their compensation in the past.
A chemist coming out of biopharma or a software developer, if told there is no equity compensation plan for all employees at your company will be, at the least, disappointed if they even continue interviewing with you.
Similarly, a candidate from the financial services world may be surprised that every employee is not participating in one or more cash incentive plans, not just the sales reps. There is a LOT of work to be done on compensation planning in the cannabis industry, and I’m thrilled to be right in the middle of it.
Fred Whittlesey is the Founder, President, and Principal Consultant of Cannabis Compensation ConsultantsTM, a Compensation Venture Group SPC company.
Fred is a member of the NCIA Human Resources Committee and the NCIA Sustainability Committee.
Fred is recognized by corporations, professional organizations, universities, media, and colleagues around the world as a compensation expert and thought leader. His ideas have been presented in numerous book chapters, journal articles, media interviews, conference and seminar presentations, and hosted blog postings.
Fred’s thought leadership in the field of compensation is evidenced by his delivery of more than 300 conference presentations, seminars, certification courses, webinars and podcasts. He has presented and taught in 26 US States, 4 Canadian Provinces, UK, Ireland, France, Germany, Netherlands, Switzerland, Turkey, and Indonesia.
He has authored more than 50 peer-reviewed journal and magazine articles, book chapters, white papers, and sponsored papers. He has been a paid writer for PayScale.com, Salary.com, InvestorJunkie.com, and SeekingAlpha.
Fred has been interviewed and quoted more than 100 times by more than 35 different media sources including Associated Press, Bloomberg, Business Week, Fortune, New York Times, Los Angeles Times, Orange County Register, Seattle Times, San Jose Mercury News, and San Francisco Chronicle. He has been retained to conduct research to support investigative journalism for The Los AngelesTimes and The Boston Globe.
Cannabis Compensation ConsultantsTM is a division of Compensation Venture Group SPC, a Washington Social Purpose Corporation. The company is a Green America Certified Business.
The firm specializes in compensation strategy, executive and director compensation, equity-based compensation, incentive design, and employee pay with a focus on sectors driven by innovation. We also provide expert witness and litigation support for civil litigation and regulatory matters. Our clients include Boards of Directors and executive teams of public and private companies, LLCs, S corporations, and foreign subsidiaries.
Our Canadian sibling consulting firm is Conscious Compensation Group Inc. in Squamish, BC.
Member Blog: Cannabis Supply Chain Roadmap – Control What You Can, Plan For The Rest
by Gary Paulin, VP of Sales and Client Services at Lightning Labels
In a world where instant gratification has run headlong into supply chain snafus and delays, something has to give. In the cannabis industry, the keys to success are to control what you can and plan for what you can’t.
Being proactive, creative, and resourceful are the keys. Cannabis purveyors are facing shortages of products and packaging. Shipping challenges, both from suppliers and to consumers, also are in the mix. And, with consumer demand through the roof, competition for fewer supplies available in a timely manner has become superheated.
What can cannabis companies do to maximize customer satisfaction while minimizing stress levels at this critical time?
The short answer can be found in the Serenity Prayer, which states in part: “God, grant me the serenity to accept the things I cannot change, courage to change the things I can, and wisdom to know the difference.”
In short, take and keep control of what you can realistically control, do contingency planning for occurrences out of your control, and know the difference between the two. One example of how to keep control: Companies facing potential shortages in many cases can build up inventory of available products, including labels, containers, and the like. Extra costs involved in doing this can be substantial, but compared to not being able to fulfill orders and having to deal with consequences — including falling revenues and workplace stress — it can be a relatively small price to pay.
One example of how to do contingency planning: Cannabis companies not in direct control of manufacturing everything that goes into a product need to figure out workarounds. In some cases, this may include advising consumers of potential looming shortages. In others, finding substitute sources that can step in if needed may be well worth the time it takes to do the research.
Again, this may cost more, but at this critical time, cannabis companies need to compare that to the cost of not doing it.
Following are specific steps cannabis companies can take to stay on top of supply chain snafus:
Determine what suppliers are clearly able and willing to meet your needs. In the label world, for example, talk with your supplier to look at likely needs through at least the first quarter of 2022. Make this company your proactive partner to offer insights about the best strategies to ensure you’ll have what you need when you need it. In some cases, this is as easy as knowing they will carry adequate supplies and perform well because they think and work ahead. In others, work with the supplier to figure out options that can substitute for something that may be in short supply.
Ramp up customer service efforts. No matter how supply chain challenges are impacting your company, spend extra time and effort to keep your customers happy. Often, frustrated or demanding customers can be made happier with sincere, empathic customer service. In addition, where possible, be proactive with customers about what they’re willing to tolerate (e.g., longer turnaround in exchange for lower price). By assessing, then fully addressing, customer needs, you can achieve positive reviews and enhance reputation by showing your ability to tune into their needs. Be real and follow through on commitments. There’s almost nothing worse than promising performance, then not delivering. If you tell them you’re going to do something, including contacting them back, do it when you say you will.
Make shipping as predictable as possible. Both for incoming and outgoing, figure out what you can expect (e.g., transportation directly under your control), and where you’ll need to rely on third-party shipping. Do some research about shippers to identify emergent issues, talk to your regular shippers about what to expect/plan for, and find substitute solutions if needed. You may also have to factor in higher shipping costs, at least through the first quarter of 2022.
Research buying trends into near-to-mid-term planning. High consumer demand is here to stay, at least for a while. As best you can, figure out what the next few months are looking like, factoring in buying demand specific to cannabis as well as the bigger global picture. Between the pandemic roller coaster, economic volatility, political and social upheaval, and proliferation of severe weather destruction and disruption, there is much beyond the realm of cannabis that may impact buyer demand and the supply chain for months, if not years.
Build in breathing room where possible. Such options as subscribe-and-save and discounts for orders with longer lead times are two measures that can take pressure off cannabis companies to a certain extent. Following the lead of such companies as Amazon, provide incentives for discounts when customers select longer lead times or commit to a regular ordering pattern.
Gary Paulin is VP of Sales and Client Servicesat Lightning Labels, a Denver-based custom label printer that uses state-of-the-art printing technology to provide affordable, full-color custom labelsand custom stickers of all shapes and sizes. Contact: sales@lightninglabels.com; 800.544.6323 or 303.481.2304.
Video: NCIA Today – Friday, December 3, 2021
NCIA Deputy Director of Communications Bethany Moore checks in with what’s going on across the country with the National Cannabis Industry Association’s membership, board, allies, and staff. Join us every Friday here on Facebook for NCIA Today Live.
Member Blog: Stickier Products Need Thicker Gloves, Right?
“My gloves keep ripping” is a common frustration we hear from cannabis businesses, especially growers and processors. If your gloves are ripping just buy thicker gloves, right? Maybe. It is a common misperception that thicker gloves are stronger, but this is not always the case. Here are four factors about glove thickness to understand that will help solve this chronic glove problem.
4 Things to consider before buying a thicker glove
Thicker does not mean stronger – A glove’s strength is directly related to the quality of materials used to make it. Period. A glove’s raw material ingredients account for 45% of the production cost. Gloves can have fillers, like carbon black, silica and chalk, added to manufacture them cheaper. Chalk doesn’t stretch. When fillers are added to reduce production costs, the glove’s durability and elasticity will reduce as well.
In one minute, this video shows how to estimate the quality of your nitrile gloves. When buying disposable gloves, always remember, a gloves’ strength is directly proportional to the quality of ingredients used to make it.
Musculoskeletal issues – Low-quality, thicker gloves have less elasticity which in turn makes workers’ hands use stronger muscle force, increasing the chance of injury. For example, a worker’s hand could have unnecessary force put on it with every hand movement they make while bucking or trimming the plant. A disposable glove needs to be of a high enough quality to perform the task and protect the product and the wearer, but excessive thickness can create additional issues. A better-made glove can be thinner while outperforming cheaper, thicker gloves.
Worker efficiency – Despite its thickness, a glove made with lower quality ingredients will rip more frequently. When your staff is constantly having to stop working to change failed gloves, productivity decreases. When workers are busy changing failed gloves they are no longer planting, growing, harvesting, trimming, or curing. Gloves that perform will increase overall productivity and efficiency, not to mention worker satisfaction.
Increased waste – Another possibly less considered consequence of buying thicker gloves is the environmental impact. Glove thickness directly correlates with the amount of waste, disposal costs, and environmental impact generated. A thicker glove equates to more material per glove being disposed of. A glove made of cheap ingredients that fails more frequently will also negatively affect a businesses’ sustainability efforts by increasing the overall quantity of gloves used. Generating more waste will in turn increase disposal costs and the amount of waste that ultimately is put into landfills.
Cannabis plants can be prickly, sticky, and sometimes relatively tough on disposable gloves. A better glove is needed. A better glove, not necessarily a thicker glove. Additionally, different stages in producing cannabis products, from growing to harvesting to processing to tinctures to edibles, can require different gloves. A single glove most likely will not live up to the performance and safety requirements at the various stages. The best way to know you’re buying a quality glove is to purchase from reputable suppliers with specific and ongoing quality control procedures in place. This ensures glove quality, performance and protection, all of which directly mitigate risk to your product and business.
Trustworthy and knowledgeable glove suppliers will be able to help arrange glove trials through which you will be able to determine the best glove to use for every task. Purchasing too heavy of a glove for a task increases costs unnecessarily. Investing the time into ensuring you are sourcing the correct gloves will protect your product, workers and budget.
Disposable gloves are not indestructible. Some tasks, like harvesting and trimming, do require a thicker glove even when they are made of the highest quality. But simply put, a thicker glove spec is not always the answer to a sticky situation.
Eagle Protect, the world’s only glove and PPE supplier to be a Certified B Corporation®. Eagle Protect supplies disposable gloves and protective clothing to the food processing, food service, cannabis, medical and dentistry sectors in both the U.S. and New Zealand.
Eagle is implementing Delta Zero, a proprietary third-party glove analysis program to ensure a range of their gloves are of consistent high-quality, and free from harmful contaminants, toxins and pathogens. The Delta Zero program mitigates the risk of product contamination and recall due to the unknown use of dirty gloves.
After establishing Eagle Protect as an industry leader in New Zealand, where the company supplies approximately 80% of the primary food processing industry, Steve Ardagh relocated with his family to the U.S. in January 2016 and launched Eagle Protect PBC. Steve brought with him Eagle’s values of providing products that are certified food safe, ethically sourced and environmentally better. Steve is driven to keep consumers safe, one high-quality disposable glove at a time, and has been instrumental in developing Eagle’s proprietary third-party Delta Zero program glove testing program.
Member Blog: Business SMS Basics for Cannabis
by Matt Hostacky, Regional Sales Manager, Flex IP Solutions/Cannabiz Text
Text messaging is the next wave of communication to customers. 98% of all texts get received. 92% are read within 5 minutes. And 45% receive a response, and if you think that your customers want to engage their favorite businesses this way, you’d be correct. 85% of people polled want text message marketing from their favorite companies.
But how do you get started? How does it work? Are there technology requirements? Etc. Here are some of the common questions we get to help you navigate this great communication tool for your business.
What are the technology requirements? An internet connection and a computer with a web browser are all that is required for most systems.
We’re not tech-savvy, is the SMS system difficult to use or learn?No, most systems are very user friendly and intuitive. Most systems work through your web browser and can be set up and used in minutes with little more than a user guide.
Can I use my existing business phone number? Yes, most platforms support text enabling your 10 digit business number. This helps people recognize who the text is coming from and build brand awareness.
What are some of the common features of an SMS system? Series (drip campaigns), Surveys (polls), Time-Texts (schedule now, send later), Contact Segments (Tags or Identifiers), Compliance tools, Reports, and Keywords (Text “Vegas” for a chance to win a trip to Vegas). Above and beyond these key features you may want to consider having 2-way chat and/or automations capabilities for your business to help answer any questions your patrons may have.
Who can I market to? Existing customers or those that have “opted-in” in some way to receive your promotions and communications. You may have new prospects or customers text a keyword to get opted in for example. However, if you acquire a list of telephone numbers for outbound communications they are considered SPAM under the TCPA and CAN-SPAM acts and you should not message these numbers.
Do I need to stay compliant?And how? Yes. Most systems (or at least the good ones) have some form of compliance automation and tracking to help keep you covered. At a bare minimum you need to have a “please reply stop to opt-out” message in each outbound marketing message.
What are the costs associated with an SMS marketing system? This is probably the hardest thing to compare apples to apples. Typically, an SMS system is a monthly charge either per text or as a package of texts. Some systems lockdown certain features and charge extra for them a’ la carte. Other systems are part of a CRM or POS system and either charge per text or a fee to unlock that feature.
What should my business have in advance of getting started with an SMS system?
1) Make sure you’re collecting phone numbers from your customers today.
2) Have a marketing disclosure statement that customers sign either electronically or physically so you are legally allowed to market to them.
3) Have said customers and phone numbers in or able to be exported to an excel or .csv file so you can upload them as contacts.
4) Have a plan. Don’t just set up a system and start sending texts. Understand why you want to text, how you will text your customers, and what you will be texting your customers.
Compliance
So why is compliance so important? We’ve all received annoying texts we didn’t ask for letting us know we’ve won a cruise or there is a sale on cheap erectile function pills. The FCC and Mobile carriers are already working to put more measures in place to mitigate the number of robo-texts and SPAM that is being sent. This is called 10DLC Campaign Registry. 10DLC Campaign Registry is too much to cover in this blog but you can find out more here 10DLC Campaign Registry.
If you’re soliciting anything to your existing customer base you must have consent, see the TCPA and CAN-SPAM acts. The best practice for this is what is called a “double opt-in”. A double opt-in is having the customers’ consent twice. The first form of consent is typically in some marketing waiver that is signed or checked during the buying process, it’s no different than getting consent to call or email promotions. The second opt-in is during the texting process. Typically, the first text received will have a message that asks the customer to reply “YES” to continue to receive texts. You usually see this with keywords that ask the person to text a word to a specific number, when that happens an automated message will then ask the person to reply with “YES” to continue to receive messages.
Another form of compliance is opting out. You must always have a “please reply “STOP” to stop receiving texts…” message in your messages. The first question you should ask about any SMS/texting solution is if this is built into it, meaning if someone replies back with STOP at any time, does it remove them from your marketing list even if you don’t have the wording in the text? If the answer is no, it’s not a system you want to use. Once again the TCPA and CAN-SPAM acts mandate that you give the consumer a way to opt-out of receiving messages from your business. And you’ll want a system that captures and can report on this as well.
Something to understand is that certain things are still illegal to promote via text, i.e cannabis. Mobile carriers (the companies that transport the SMS messages) like ATT, TMobile, and Verizon have filters that are looking for hot button or trigger words. So words like cannabis, marijuana, weed, edibles, and ganja are going to get flagged. This doesn’t mean that you can’t still use text message platforms. It just means that instead being obvious about what you text out you become a little more vague. Your customers will still know there is a sale on edibles if you say something like “2 for $20 on ABC brand yummy treats this week”.
Compliance doesn’t have to be all doom and gloom. Make it fun. The most successful businesses do an initial promotion or giveaway to get folks to opt-in to their text marketing. Another great tip is to put your business’ name at the front of the text with a colon so everyone knows who the text is coming from. i.e. ACME: Acme widgets on sale this week 20% off! Remember your customers want to hear from you, they want to stay informed of any new products or promotions… that’s why they’re your customers. They just don’t want to be bombarded with SPAM on their personal devices at all hours. So be courteous and make sure the number of text promotions is not too much and are being delivered at appropriate times.
Additional Use Cases
By now most folks are aware of the two most prominent use cases for business texting, 1) marketing and 2) appointment reminders. But there is a wide world of other use cases for texting that you may not have even thought about. And these use cases can help separate your business from others by delivering a “wow” customer experience.
Customer Service
Instead of phone calls, why not answer questions about your product or service using texts? The advantages of using text for customer service are:
Customers don’t have to wait on hold for the next agent
There is always a record for that customer to refer to
Your employees can handle multiple chats at one time unlike voice calls
You can automate answers to the most frequently asked questions.
Sales
Yes, this is different from marketing because marketing is one-way. With two-way texting you can interact with your customers the same as you would in-person or via a phone. Your sales force can provide the presales support that your customers expect but with the convenience of a text or picture message.
Delivery Notices
If you’re in the business of deliveries or in-home service these are a must for a great customer experience. Send pictures of your delivery driver in advance. Let your customers know when their package will be or has been delivered.
Alerts
During the COVID-19 lockdown, almost every business’ processes changed. Masks needed to be worn, social distancing observed, and a lot of businesses went to calling or texting when a customer or patient could be seen. The businesses that had an SMS platform ready to go didn’t miss a beat. There were signs like “Text our main number to let us know you’ve arrived” for things like veterinarian offices, healthcare, retail stores, and restaurants.
Business SMS is still relatively new, but the use cases continue to grow. Communication has moved to a person’s mobile device now and we don’t check or pay attention to email like we used to. People expect real-time alerts and notifications on their phones. Leveraging business SMS in multiple ways can provide a memorable customer experience to your patrons which will, in turn, create repeat customers.
Matt Hostacky, Regional Sales Manager, Flex IP Solutions/Cannabiz Text
Matt Hostacky, an IT and telecommunications industry veteran, takes a consultative approach to solve real-world business challenges with technology solutions. He serves as Regional Sales Manager for FlexIP Solutions Inc., a provider of managed communications services customized for businesses of all sizes and optimized for best value and performance. Hostacky advises customers on communications and collaboration strategies that leverage solutions, such as Cloud PBX, Unified Communications as a Service, Contact Center as a Service, Collaboration as a Service, SIP Trunking, Secure SD-WAN, Business Continuity and Disaster Recovery, and Business Text Messaging.
Video: NCIA Today – Friday, November 19, 2021
NCIA Deputy Director of Communications Bethany Moore checks in with what’s going on across the country with the National Cannabis Industry Association’s membership, board, allies, and staff. Join us every Friday on Facebook for NCIA Today Live.
Thoughtful Legislation: States Reform Act Introduced
Photo By CannabisCamera.com
By Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Recent polling from Gallup showed that an astonishing 68% of Americans believe that cannabis should be legal. And while support spans age groups and party lines, cannabis is usually thought of as an issue Democrats champion – but one woman is looking to change that.
This week, freshman GOP Congresswoman Nancy Mace (SC) officially threw her hat in the cannabis reform ring with the introduction of the States Reform Act. Notably, this is the second comprehensive cannabis bill introduced by a Republican member of Congress (the other was sponsored by Rep. Dave Joyce, one of the co-chairs of the Cannabis Caucus).
According to Rep. Mace’s office, here are some of the things the bill does:
Ensures that no state or local government will be forced to change its current cannabis policies by removing cannabis from Schedule I and deferring to states.
Regulates cannabis federally like alcohol under USDA for growers, ATF/TTB for cannabis products, and FDA for medical use.
Institutes a low 3% federal excise tax on cannabis products to fund law enforcement, small business, and veterans mental health initiatives.
Ensures the safe harbor of state medical cannabis programs and patient access while allowing for new medical research and products to be developed.
Outlines the federal release and expungement for those convicted of nonviolent, cannabis-only related offenses. This will not include cartel members, agents of cartel gangs or those convicted of driving under the influence (DUI). Mace’s office estimates that approximately 2,600 releases will be expected at the federal level. State level releases and expungements will be left to each state to determine.
Protects military veterans by ensuring they will not be discriminated against in federal hiring for cannabis use or lose their VA healthcare benefits.
Protects children and young adults under the age of 21 from cannabis products and advertising nationwide. Incentivizes states to make cannabis illegal for anyone under the age of 21, with a medical exception for prescribed use. Provides funding to the Substance Abuse and Mental Health Services Administration to ensure protections for minors are being considered.
Protects medical cannabis for the following uses: arthritis, cancer, chronic pain, sickle cell, HIV/AIDS, PTSD and other medical uses per a state’s specific cannabis regulations.
NCIA applauds Rep. Mace for introducing this new and carefully thought out piece of legislation. There are many provisions in the bill that we support: low tax rates and barriers to entry, allowing states to lead – but also many areas with room for improvement like those pertaining to criminal justice and trade. NCIA will continue to work with Rep. Mace’s office to improve this bill and attempt to find common ground across political parties in order to advance cannabis policy reforms.
Member Blog: Why an Efficient Dispensary POS System is Crucial for Cannabis Retailers
Running a cannabis dispensary isn’t like running any other type of business. You don’t only have the stress of inventory, expenses, a demanding customer base, and sales to worry about, but also incredibly stringent state, county, and city laws. State compliance is at the core of keeping your storefront running, but automating reporting with software can alleviate some of the stress associated with compliance.
Selecting a cannabis software that fits your business model is crucial to scaling your business. Here are five essential things to look for in an efficient dispensary POS system and how they will benefit your cannabis operation.
Improving Customer Experience
Customer retention will make or break your business. Building a base of happy customers is imperative for your dispensary to survive and thrive. There are lots of ways to create a memorable and positive experience for your customers. Seamless transactions, loyalty rewards, and employees that understand buying habits make it enjoyable for customers to shop. A premier dispensary POS system will give you control over all of these. Checking out customers quickly and efficiently, while utilizing a rewards program to incentivize them to come back is what customers expect and not all POS systems deliver on these expectations.
Another sign that a POS system is worthy of your business is one that has a strong user base and an active support team. Frequent engagement with their users and regular help center articles are a good indication that the POS provider is actively working with their community to solve issues and create a better experience.
Furthermore, the software provider should provide multiple training sessions when you come on board. This gives you, your staff, and management team the knowledge and know-how to use the software proficiently. A good POS provider will also help you develop standard operating procedures that best work for your business and their software. Implementing your software in tandem with best practices will maximize the efficiency of your dispensary. After all, POS systems aren’t always cheap, so you should expect a “white glove” approach by their team.
Optimizing Cannabis Inventory
There is very little room for mistakes in the cannabis industry. Inadequate cannabis ERP systems can cause issues with inventory discrepancies which can easily lead to compliance fines, penalties, and even your license being revoked. A reliable POS system provides accurate, real-time data that seamlessly allows you to manage your stock and improves customer shopping experience.
Better inventory management also helps in team day-to-day operations. When your staff can easily audit inventory and use reports to see what is selling, they can make informed decisions when purchasing stock to keep your customers coming back. This results in high customer satisfaction, repeat business, and more sales. You want to optimize your inventory ordering so you can have enough of the right products at the right times to meet demand and offer a superior customer experience.
Automating State Compliance
Compliance is the x-factor for cannabis businesses. Few other industries deal with regulatory restrictions as stringent as the cannabis industry. That’s why it is so important to have cannabis POS software that is integrated with track-and-trace programs selected by the state. Metrc and BioTrack are the most commonly used track and trace systems. You’ll want to make sure you dispensary ERP automates compliance reporting to avoid any risk of human error.
Real-time compliance integrations with Metrc and BioTrack will report sales accurately as they happen. There are no shortcuts when it comes to compliance so your cannabis POS needs to factor in all the required taxes as well. Additionally, it should enforce customer purchase limits and verify age. These are two regulatory rules that can quickly cause easily get your shop shut down if not strictly followed.
Useful and Seamless POS Integrations
Be wary of POS systems claiming to be all-in-one solutions. These tend to be masters of none. A great POS will integrate with other leading softwares to bring you a well-rounded platform. Look for one with a wide range of integrations that help with things like marketing, e-commerce, loyalty, analytics, etc. Finding a dispensary POS that supports your current tech stack will save you time and headaches.
It’s also useful to do research on software review sites to see how these integrations hold up. Just having integrations isn’t enough. These integrations need to work seamlessly with your POS system and be as easy to utilize as the platform itself.
Cannabis Software That Scales
The last thing you should look for in a POS system is one that has the ability to handle your business as it scales into multiple locations or a delivery fleet. Not all dispensary software can support a multi-storefront or delivery. It really comes down to the features and functionality. Is there a master inventory catalog that can categorize inventory across multiple stores?
Does your dispensary POS also offer built-in dispatch and delivery functionality? Evaluate which software can serve you best long-term versus a short-term fix. Look for one that broadcasts its new features, integrations, bug fixes, and improvements. This will give you a good idea of how the POS is keeping up with the pace of new industry advancements.
How to Decide on a Dispensary POS
Looking for these five things will give you a solid understanding of what your POS platform should have and steer you in the right direction when it’s time to buy. There are a few additional ways to evaluate potential cannabis software providers. It never hurts to come prepared with specific questions during a demo that are relevant to the workflows utilized in your dispensary. This will give you a clear understanding if the dispensary POS system can seamlessly integrate with your current SOPs or if you’ll need to adapt your internal procedures.
Before making the big decision, inquire about the migration plan, the onboarding process, and any additional hardware that might be needed. These are important factors to consider so you can avoid future roadblocks. Lastly, call their customer support line just to test their response time. Waiting to be connected to a support agent can be frustrating if something does go wrong. It’ll give you more confidence in your decision if you know that the support team is easy to contact and capable of resolving issues quickly.
Steven Lynn, a California resident since 2011, has dedicated his career to destigmatizing and legitimizing the cannabis industry through technology. Steven started his career in cannabis as the Director of Marketing at IndicaOnline in 2017. He now serves as the Director of Marketing at BLAZE® responsible for driving all marketing strategy, brand development, and lead generation programs. His professional background in early-stage B2B cannabis SaaS startups has made him adept at executing scalable, impactful, and sustainable strategies to achieve exponential growth. Steven received his BA in Communications from the College of Charleston in 2006 and is a seasoned marketing professional with over 10 years of experience working in both the entertainment and canna-tech industries.
Founded in 2017, BLAZE, a VC-backed California technology company, offers unified seed-to-sale software and apps for the cannabis supply chain. Developed by tech entrepreneurs and former cannabis company operators, BLAZE makes tech simple with an easy-to-use frontend powered by an enterprise backend for dispensaries, delivery services, distributors, and cultivators. Customers can be more profitable and productive while creating a better user experience for end customers and employees. The company’s software ensures compliance with local laws and taxes. BLAZE offers full APIs and integrates seamlessly with over 40 technology vendors in the cannabis industry.
Member Blog: How Can Hemp Businesses Better Self-Regulate?
The hemp industry is still in its early stages, especially when it comes to emerging products like delta-8 THC. While there is some regulation for hemp products, it’s much less than for legal cannabis, and this gives companies some freedom in terms of how they operate and what they do. For the most part, this is a good thing, but there is a downside too. Our report into the industry found that 76% of delta-8 THC products contained illegal quantities of delta-9 THC. This is terrible for consumers, but it also poses a risk to the industry: if you keep raising red flags, the government will eventually swoop in and take action. This is why self-regulation is a crucial concept for hemp businesses going forward.
Why Self-Regulate?
Self-regulation is crucial for hemp businesses because of the scrutiny the industry faces and to improve consumer confidence. Although CBD is generally accepted, this is especially important for companies selling something like delta-8 THC, which attracts more scrutiny because of its psychoactive nature. With states like Texas attempting bans on the substance and the findings of our report showing that the vast majority of products break legal limits for delta-9, the industry is in serious danger of attracting the attention of more lawmakers who may opt for an outright ban. In fact, there are already 18 states with some form of ban or restriction on the substance.
Jayneil Kamdar, PhD from InfiniteCAL Labs commented to us that: “The current delta-8 THC products on the market are very concerning because there is no regulatory body monitoring the safety of these products.”
In our report, we also found that companies tend to undercut customers on delta-8, that only 14% of companies perform substantial age verification checks and that two-thirds of companies don’t test their products for impurities.
It isn’t that self-regulation would be a cure-all, but if companies opt to act responsibly, it is much less likely that they will attract attention from lawmakers. In addition to this, though, self-regulation sends a strong message to consumers that you care about them and that they will get what they wanted when they buy your products. When this doesn’t happen,people will tell others about it.
The more the industry can mirror the regulations of regulated cannabis companies, the better things will go in the long run.
How Can Companies Better Self-Regulate?
However, “self-regulation” can’t just become a vague, catch-all term for generally responsible business practices: clear recommendations are essential in making this goal a reality. Luckily, our in-depth investigation of the delta-8 industry and other similar investigations into the CBD industry have revealed some key areas companies can focus on.
Provide Transparent Lab Reports with QR Codes
Lab reports are a vital part of building consumer trust, and you should ensure there is a QR code on the report so it’s easy for consumers to verify the report on the lab’s website.90% of CBD companies already do this, based on our industry analysis.
Offer a Lab Report for Every SKU
Many companies, however, only offer a COA for the base distillate, rather than every specific type of product it produces. If you sell vape cartridges, for instance, you should have a report available for each variation in flavor, strain, and potency.
Choose Credible Labs for Your Report
Not all labs are equal. If you get a report from a questionable or unknown lab, savvy consumers will still be wary of your product, and in some cases, the results may be unreliable. It’s best to choose a lab with a strong reputation, such as ProVerde, Anresco, SC Labs, InfiniteCAL, and CannaSafe.
Test for Impurities
With two-thirds of delta-8 companies not lab testing their products for impurities, this is a good way to stand out in the marketplace as well as good practice in general.
Verify Customer’s Ages
With most CBD companies not performing robust age verification checks, using a credible age verification system such asAgeChecker is a great step towards self-regulation. They stay up to date with FDA requirements, state laws, and merchant account policies, so you can set it up and then continue basically as normal. This is especially important for delta-8, but it’s also crucial for higher-strength CBD products too.
Label Your Products Accurately
What you claim on the label should be what’s in the product. Lab reports help you verify that this is the case.
Warning and Caution Labels
Only about 55% of hemp delta-8 companies use a warning label, but this is another key part of self-regulation. Suggested verbiage includes:
This product should be used with caution when driving motor vehicles or operating heavy machinery.
Use this product under the guidance of a physician if you have a medical condition, are pregnant or lactating.
Keep out of the reach of children.
This product was manufactured from hemp material that meets federal requirements for hemp products; however, consumption may be flagged by some drug tests.
This goes hand-in-hand with the above, but also, having your products that looklike a bag of Cheetos or anything along these lines is not a good look.
Avoid Medical Claims
Although many people opt to use delta-8 and CBD for medical purposes, if you’re selling the products, making medical claims that might not meet official organizations’ standards of proof is simply a terrible idea. Leave it to your consumers to determine.
Get Industry Certifications
Getting certified by an organization like theU.S. Hemp Authority is a great way to show your customers that you’re one of the responsible companies.
Conclusion
Self-regulation really just means taking a few basic steps to establish to both customers and politicians that you’re running a legitimate business which does what it claims to and is socially responsible. It might increase costs in the short-term, but over time and especially as consumer knowledge increases, it will pay off many times over. And the next time there’s a situation like what happened recently in Texas, the industry will have a much easier time defending its practices.
Lee Johnson is a writer at CBD Oracle who has been covering science, vaping, and cannabis for over a decade. He focuses on research-driven deep dives into topics ranging from medical uses for CBD to industry and user statistics, as well as general guides and explainers for consumers. He is a passionate advocate of both CBD and cannabis, and a strong believer in informed choice for consumers.
CBD Oracle is a consumer research company working to improve the safety and transparency of cannabis products, producing in-depth statistics on CBD and cannabis, detailed research pieces and analysis of social and legal issues.
Member Blog: Let the Good Times Roll – New Jersey’s Cannabis Markets Primed to Meet High Demand with Two Big Announcements from the Cannabis Regulatory Commission
New Jersey’s medicinal and adult-use cannabis markets are finally starting to take shape more than ten years after the medicinal marijuana program was launched. In the span of one month, the New Jersey Cannabis Regulatory Commission (“CRC”) not only announced awards for fourteen new medicinal cannabis licenses, but also, on November 9, 2021, gave the long-anticipated official notice that the state will soon begin the application process for the award of personal-use cannabis licenses.
In particular, the CRC announced this week that it will begin accepting adult-use applications for Class 1 Cultivator and Class 2 Manufacturer licenses, as well as licenses to run testing laboratories, beginning on Monday, December 15, 2021. Additionally, the CRC announced it will begin accepting applications for Class 5 Retailer personal-use cannabis licenses on March 15, 2022. While there is more information that will be forthcoming from the CRC, some major takeaways from the CRC’s November 9th notice are as follows:
The CRC set forth its scoring criteria and what applicants need to provide to score full points, as well as bonus points;
Bonus points will be awarded for, among other things, confirmation that at least one owner has been a New Jersey resident for at least five years as of the date of the application, and submission of a signed project labor agreement with a bona fide labor organization;
Local support for applicants will be critical as a municipality may, among other things, submit its preference to the CRC for the issuance of licenses to certain adult-use cannabis businesses;
Applications will be accepted on a rolling basis, with no limit on the number of licenses the CRC will award, other than a preliminary limit of 37 Class 1 Cultivator licenses prior to February 22, 2023. These cultivator licenses will be awarded to the first 37 applicants that meet all licensing, regulatory and operational requirements, and satisfy the conditions for priority approval;
The only exception to the above cap on Class 1 Cultivator licenses is for those applicants who apply as a “microbusiness” (there are residency requirements to qualify as a microbusiness, and operations of a microbusiness shall include no more than 10 employees; a facility of no more than 2,500 square feet; possession of no more than 1,000 plants per month; and/or a limit of 1,000 pounds of usable cannabis per month); and
Priority review and approval will be given to applicants who meet the CRC’s social equity, diversely-owned, and impact zone business criteria, in addition to other metrics.
The CRC will hold a pre-application webinar on November 30, 2021 for anyone interested in personal-use cannabis licensure. The medicinal and personal-use cannabis markets have put down deep roots in New Jersey, and consumer demand is budding like never before. Don’t let questions about this new regulatory landscape leave you and your business up in the air.
Charles J. Messina is a Partner at Genova Burns LLC and Co-Chairs the Franchise & Distribution, Agriculture and Cannabis Industry Groups. He teaches one of the region’s first cannabis law school courses and devotes much of his practice to advising canna-businesses as well as litigating various types of matters including complex contract and commercial disputes, insurance and employment defense matters, trademark and franchise issues and professional liability, TCPA and shareholder derivative actions.
Jennifer Roselleis a Partner at Genova Burns LLC and Co-Chair of Genova Burns’ Cannabis Practice Group. She has unique experience with labor compliance planning and labor peace agreements in the cannabis marketplace. In addition to her work in the cannabis industry, Jennifer devotes much of her practice to traditional labor matters, human resources compliance and employer counseling.
Daniel Pierreis an Associate at Genova Burns and a member of the Cannabis and Labor Law Practice Groups. In addition to labor work, he likewise assists clients in the cannabis industry, from analyzing federal and state laws to ensure regulatory compliance for existing businesses to counseling entrepreneurs on licensing issues.
For over 30 years, Genova Burns has partnered with companies, businesses, trade associations, and government entities, from around the globe, on matters in New Jersey and the greater northeast corridor between New York City and Washington, D.C. We distinguish ourselves with unparalleled responsiveness and provide an array of exceptional legal services across multiple practice areas with the quality expected of big law, but absent the big law economics by embracing technology and offering out of the box problem-solving advice and pragmatic solutions.
Our firm is proud of its proven track record of assisting multiple clients with being awarded medical licensure in New Jersey, and continuing to counsel clients on the dynamic federal and state regulatory landscape, as well as with corporate transactional, labor/employment, real estate, land-use and other issues.
Given Genova Burns’ significant experience representing clients in the cannabis, hemp and CBD industries from the earliest stages of development in the region, the firm is uniquely qualified to advise investors, cultivators, processors, distributors, retailers and ancillary businesses.
NCIA Announces Incoming Board Members
The National Cannabis Industry Association (NCIA) is announcing a slate of incoming members of its Board of Directors today, including six incumbent Board members and two new nominees selected by the organization’s Nominating Committee to serve for the Board’s 2022-24 term.
The organization’s Nominating Committee selected six incumbent board members and two new nominees to serve on the board for the 2022-24 term. The newly-selected board nominees are MadisonJay Solutions Managing Member and NCIA Policy Council Co-Chair Michael Cooper and The People’s Ecosystem CEO and Chair of NCIA’s Diversity Equity & Inclusion Committee, Christine De La Rosa.
“We’re pleased to welcome the new and returning members for the next board term. Their leadership will be instrumental in advancing our vision for a legal, well-regulated, and inclusive cannabis industry,” stated NCIA CEO, co-founder, and Board member Aaron Smith.
As the longest running trade association for cannabis businesses, NCIA has been advocating on behalf of the cannabis industry since 2010. The organization has always maintained a transparent and representative leadership selection process in order to reflect its diverse membership, composed primarily of small businesses in the burgeoning industry.
“As the only broadly representative trade association representing the cannabis sector at the national level, we will always lead with integrity and advocate for the policies that are best for the industry as a whole, not just a handful of operators,” continued Smith. “That means always standing up for policies based in equity, restorative justice, inclusive markets, and against protectionist policies such as arbitrary license caps. I’m confident our board will continue to exemplify those core values in the year ahead.”
The incoming slate of Board members will join directors already serving on the Board for the 2021-23 term. The full list of current Board members and their bios is available here.
Bringing the Beltway to the Bay at Cannabis Business Summit & Expo
by Madeline Grant, NCIA’s Government Relations Manager
There is no doubt that we’ve missed the in-person, one on one interactions in the cannabis industry. For anyone that attended the Midwest Cannabis Business Conference in Detroit in September, it was refreshing to connect with friends and meet new friends in the cannabis industry. Fortunately, we have the chance to meet in person again at the 7th Annual Cannabis Business Summit and Expo (CannaBizSummit) in San Francisco, California. From networking with California-based cannabis companies to meeting new companies in the industry, there is no lack of connections to make at CannaBizSummit.
Pictured Right: NCIA member Sonny Antonio with Sunshine Design and I at MJBizCon at NCIA’s booth.
The National Cannabis Industry Association (NCIA) has been hard at work in Washington, D.C. With the introduction of the Cannabis Administration and Opportunity Act draft legislation, there had been an undeniable excitement to support momentum towards cannabis policy reform. The Government Relations team submitted comments to the sponsoring offices on behalf of NCIA’s members and will continue to work to support members’ best interests. We appreciate your support of NCIA and the missions we continually work to achieve.
At #CannaBizSummit there will be opportunities for educational panels on federal cannabis policy and opportunities to connect with cannabis professionals in all sectors of the cannabis industry. Below are just a few of the education panels and “Lightning Lessons” that will be taking place throughout the conference:
You can find more information and details on the agenda and sessions HERE.
NCIA is honored to welcome our 2021 #CannaBizSummit Keynote Speaker, Troy Datcher, CEO of The Parent Company. Leading a new generation of c-suite innovators, Chief Executive Officer Troy Datcher, together with Chief Visionary Officer Shawn “JAY-Z” Carter, helms a cannabis business for the post-prohibition era The Parent Company. Combining best-in-class operations with leading voices in popular culture and social impact, the company focuses on building brands that will pave a new path forward for a legacy rooted in equity, access, and justice.
Beyond the panels and educational resources, attendees will be able to meet others from around the country. From cannabis cultivators to cannabis retail owners, there is no shortage of potential to network. At NCIA, we continue to support our members’ best interests by providing a continued understanding of the political landscape of cannabis policy reform. It’s our goal to support value-driven reform and support a responsible cannabis industry. Remember, if you are an NCIA Blooming or Evergreen member, you have a number of complimentary tickets to our trade shows.
If you have any questions regarding your membership or the CannaBizSummit please reach out to me via email, Madeline@TheCannabisIndustry.org. There is a lot to be excited about this year and I hope to see you out in San Francisco this December!
Member Blog: Creating a Cannabis Website Optimization Strategy
By Dmytro Syvak, Business Development Specialist at MjSeo Agency
Generally speaking, there should be only one strategy and its essence lies in a fairly simple principle – to make a good product. If the advantages and strengths of your proposal are clear not only to you, then you are on the right track. New products or services in competitive niches like cannabis may take a little more time and effort to become recognizable and convince users to choose you. But at the same time, in an ideal situation, you will be working with an audience that:
is aware of a problem or any struggle;
knows that solutions exist and wants to try them;
is ready to communicate with solution providers to choose the most suitable option;
expects not only the benefits but also thinks about the potential profit of such cooperation.
Strategy and Tactics
The main thing when it comes to the cannabis industry is the fact that it has numerous political and legal regulations even though it has a great potential to boost state and national economies. For example, if you are doing out-of-home advertising, you should consider that it is prohibited to place ads near schools. It also means that you can’t use some effective advertising platforms suitable for other niches like radio, vehicle, or television. In that way, it is essential to have a strategy.
Strategy is your overall direction, the goal of your efforts. If you can answer the question “why” you are building links – most likely you have a strategy or at least a strategic vision. Tactics answer the “how” and “what is needed” questions. Why is it important not to confuse tactical action with planning and strategy? Basically – to avoid a mess.
There are about 10 basic link-building tactics, depending on whether your site is niche-oriented or not. These are actions aimed at increasing the qualitative weight of links for a site for the purpose of its advancement in search results, placement of various links of a resource on authoritative platforms. Link building is considered one of the most effective methods of SEO optimization, especially for the cannabis niche.
Link building is needed by:
young brands about which there is little information;
companies operating in niches with the high competition;
brands that want to improve visibility and are looking for ways to increase traffic.
In that way, it is a perfect strategy for the cannabis niche as it fits all three criteria. Link building is an essential part of promoting a business online and increasing the number of customers. Competent promotion of the site with links on certain sites can bring the web page to the TOP and improve the company’s image. Considering the number of regulations and prohibitions in the cannabis niche, link building is one of the best instruments to let people know about your brand.
Coverage
Also known as outreach, it is one of the main link-building tools. It is based on the spread of information about the project and obtaining backlinks from stakeholders, that is, a lot of communication and work with people.
When selecting potential partners, it is crucial to take into account not only the industry but also the segment, target audience, and the scale of your project. Those with whom you will communicate should not guess why and how you can be mentioned. The higher the relevance of your product to the partner site, the easier and faster the communication about placement will be. The first signal of low relevance is the lack of answers and reactions.
Thus, for cannabis businesses, it is better to place links in interested communities, thematic websites, or news portals.
Existing Links
This includes many tools limited only by your skillset, budget, and imagination. The main feature is that instead of trying to get in touch and create a completely new partnership, the work is carried out with already existing, most often published and indexed links.
Unlike outreach tactics, in this case, the key to success will be accuracy and automation of as many processes as possible – from collecting data to using mailings instead of single messages. Here are some examples of tactical work with existing links:
Guest blogging is also a good fit if, instead of publishing your own articles, you are building your work around existing popular content.
Broken links – old content, lost during migration or post updates, and so on. It may work great for niche or competitive content so, it is relevant to use it for cannabis businesses.
Own backlinks – as your project develops, some of the backlinks will be lost one way or another. But almost any search analytics service will be able to regularly provide you with a list of domains from which you have lost links.
Weak content – you simply find existing publications that can be easily improved and made more attractive without significant costs on your part. This is a great possibility to demonstrate your expertise in the niche.
Diversification of content. It is essential not only to post articles but also to add videos, presentations, and so on. For example, news or educational content are currently central in the cannabis niche.
Practice
If you want to learn more about getting organic backlinks, especially in competitive niches, sharing experiences and hands-on material will be most helpful. Conferences and meetups will allow you to receive the most complete and relevant context, info about updates and news, as well as specific information about which tools bring the best results.
If we talk about building a link mass for a niche project, then you will need to use at least three basic directions: working with communities and social networks, as well as placing guest publications and comments on relevant blogs. The main tip for cannabis businesses here is to educate, don’t sell. Try to engage the readers with the content you create. Useful or entertaining content will be the best choice. If you succeed, people will come to your website in search of more information.
Also, keep in mind that fresh domains with zero authority are more likely to experience the Google sandbox effect. If your organic search traffic isn’t going anywhere despite your best efforts, you will likely need to wait at least a month and reach a certain ratio of backlinks to estimated domain authority. Once the criteria are met, everything should return to normal.
It is also essential to remember that many social network platforms prohibit cannabis marketing which makes it much more difficult to increase the visibility of the brand. Among them are:
Facebook
Google AdWords
YouTube
Instagram
Twitter
However, there are still ways to publish content. For example, Facebook allows creating product pages where you can publish useful or entertaining information without bluntly promoting your product.
As a Result
At the very end, it is necessary to say that link building should not be a difficult process. Is it time-consuming? Yes, especially in competitive niches. But with the right planning and the right strategy, backlink building tasks shouldn’t take you much longer than regular site maintenance.
The mission of MjSeo agency’s cannabis marketing experts is to help our customers become world-famous by means of a well-thought-out SEO strategy, and increase their profits hundreds of times.
MjSeo exclusively focuses on SEO strategies for the cannabis segment. It offers tailored services, including customer needs analysis and SEO. Its customers have seen their traffic surge and their websites have risen to the top of search engine rankings. The company’s personalized promotional tactics help companies thrive in the digital space.
The cannabis SEO experts from the MjSeo agency know how to help your marijuana business increase site traffic and, therefore, the number of customers.
Email:hello@mjseo.agency
Video: NCIA Today – Friday, November 5, 2021
NCIA Deputy Director of Communications Bethany Moore checks in with what’s going on across the country with the National Cannabis Industry Association’s membership, board, allies, and staff. Join us every Friday on Facebook for NCIA Today Live.
On the latest episode, Bethany announces the keynote speakers at #CannaBizSummit this December in San Francisco, shares a bit about Exspiravit this month’s Member Spotlight recipient, and covers compliance and extraction.
Registration to the Cannabis Business Summit in San Francisco is now open with special limited-time super early bird pricing on tickets available, head to our website for more information today.
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As the largest national trade association of the cannabis industry, NCIA works to advocate for and advance the interests of hundreds of member businesses. The recent publication of the Whitney Economics U.S. Cannabis Business Conditions Survey Report offers a granular look at how respondents are feeling, and what they are worried about. 
Elizabeth Corbett, VP of Sales for 
We at NCIA would like to take a moment to thank our members, partners, and sponsors, as well as so many new faces in the cannabis industry, who attended and supported our 7th Annual Cannabis Business Summit & Expo, December 15-17, 2021, in San Francisco. As we reflect on this successful three-day event, several key elements stand out as high points to remember.
by Madeline Grant, NCIA’s Government Relations Manager
Jennifer Spanos is the VP of Product and Vertical Strategy at 
I am an Oakland-based hemp CBD & cannabis brand strategist, product developer/educator, and cannabis industry advocate who recently became a member of the NCIA DEI Committee. 
My career has more recently reached the intersection of beauty/personal care and cannabis products. I recently learned that some of the largest cosmetic/personal care companies in the world are now incubating emerging brands instead of regarding them as competition to be squashed or absorbed. Some are being groomed for future acquisition but not always anymore. It’s a more mutually beneficial business relationship.
by Wendy Barr, CEO & Creative Director, 
by Mike Lomuto, NCIA’s DEI Manager
John Kievit is 
by Fred Whittlesey, Founder, President, and Principal Consultant of 
by Morgan Fox, NCIA’s Director of Media Relations
Gary Paulin
Matt Hostacky, Regional Sales Manager, Flex IP Solutions/Cannabiz Text
Steven Lynn, a California resident since 2011, has dedicated his career to destigmatizing and legitimizing the cannabis industry through technology. Steven started his career in cannabis as the Director of Marketing at IndicaOnline in 2017. He now serves as the Director of Marketing at BLAZE® responsible for driving all marketing strategy, brand development, and lead generation programs. His professional background in early-stage B2B cannabis SaaS startups has made him adept at executing scalable, impactful, and sustainable strategies to achieve exponential growth. Steven received his BA in Communications from the College of Charleston in 2006 and is a seasoned marketing professional with over 10 years of experience working in both the entertainment and canna-tech industries.
Charles J. Messina
Jennifer Roselle 
Daniel Pierre 
Pictured Right: NCIA member Sonny Antonio with Sunshine Design and I at MJBizCon at NCIA’s booth.
The mission of 