Measures of Success in Dispensary Operations

Measures of success are imperative for operations of any cannabis dispensary. Dispensary measures of success may be quantitative or qualitative as long as there is a way to consistently measure and track the data.  It's important to measure success the right way because it informs how a cannabis dispensary spends time and effort. If a cannabis dispensary doesn't measure success in terms of what's truly important to business, it can't work towards getting to its goals (revenue, profit, brand recognition, etc.).

 

5 benefits of using measures of success in cannabis dispensary operations :

1.    Allows you to track progress across various information points.  

Using sales as the single measure of business progress is inadequate.  When a company identifies and tracks multiple measures of success management and ownership can have a birds eye view of overall performance and which variables are either positively or negatively influencing each other.

 

2.    Makes marketing dollars more efficient.

When a dispensary tracks performance of marketing initiatives it can pinpoint which marketing initiative is actually effective and which is not.  Marketing dollars can then be better allocated to the marketing initiative(s) shown to be most effective.

 

3.    Gives insight into consumer preferences and trends.

Tracking sales of product types as well as the turnover of inventory can inform purchasing decisions. Dialing in purchasing decisions can improve customer satisfaction, sales projections and sell through rate.

 

4.    Helps to maintain compliance.

Tracking items such as state inspector compliance results and internal audit findings can give insight into the areas where the dispensary is either struggling or thriving in maintaining compliance.  This information can inform where there are needs to alter standard operating procedures, and what topics require to improved training methods.

 

5.    Improves employee performance.

Human resources can become costly when a company has a high turnover rate. Management winds up spending more time hiring and training than they do being able to actually build team performance and company culture.  Over time, high turnover rate or low employee engagement damages the bottom line. Identifying trends in employee behavior and engagement can give insight in to where leadership, hiring and/or training may need to improve.

 

Examples of Measures of Success for dispensary operations:

 

Financial Reports

Measuring how well the dispensary is performing financially, overall.

  • Budget Adherence
  • Profit and Loss Statement
  • Balance Sheet

 

 

Marketing Engagement Reports

Measuring how well the dispensary is reaching customers.

  • Search Engine Optimization ranking (i.e: how Google-able the dispensary is, versus competitors)
  • Sentiment Analysis of social media posts and reviews written by customers
  • Number of social media tags
  • Number of social media comments
  • Number of website visits
  • Event attendance (if applicable)
  • Customer surveys

 

 

Retail Reports

Measuring the flow of products and customers through the store.

  • Inventory turnover rate
  • Percentage of return customers
  • Average net sale per customer
  • Number of online sales, relative to customer transactions
  • Sales
  • Product highlights indicating the best and worst performers by volume and margin
  • Market comparisons updating the company's SWOT Analysis (Strengths, Weaknesses, Opportunities and Threats) that will include competitors' pricing strategies.

 

Compliance Reports

Measuring how well the dispensary is adhering to regulations.

  • Number of State inspections
  • Number of compliance audits performed by the State marijuana authority, with low-impact or zero deficiencies
  • Number of compliance audits performed by the State marijuana authority, with low-impact or zero deficiencies
  • Number of deficiencies identified by State marijuana authority inspectors
  • Number of deficiencies identified by internal audits performed by managers or by third party reviewers

 

Human Resource Reports

Measuring  the quality of leadership, hiring, employee satisfaction and training

 

·     Turnover rate

·     Number of customer complaints related to employees

·     Number of call outs

 

   

Ways to make measures of success more meaningful:

Measures of success in a dispensary are most meaningful when there is a clear vision for the business.  Once a vision is defined, then specific SMART goals can be identified which indicate to the owners and managers when the vision is being attained. Then when looking at results of success measurements, dispensary owners and managers can gauge whether the performance metrics are in line with theSMART goals, and pivot when necessary.  Have a clear idea of what each measure is aiming to accomplish and why makes it easier to navigate toward achieving the company's definition of success.

Contact us at www.jwhitneyco.com/hey-there to learn more about how J. Whitney & Co. can help grow your dispensary's success