Budtender turnover hinders the cannabis industry

High turnover rates among budtenders continue to plague the retail cannabis sector, an issue that is having an impact on the industry well beyond the immediate costs.

Budtenders are the first port of call for consumer education and are often the best choice for a marijuana brand to promote a product.

Growers and brands spend significant chunks of their budgets sending their sales reps into stores to educate budtenders about their products, only to let them leave shortly thereafter.

“That’s a million dollar fight right there. … They build relationships with budtenders and people on the front lines of the consumer, and next they turn away,” said Chris Morsette, president of Redding, Calif.-based grower Ember Valley.

A recent report by Seattle-based data analytics firm Headset found that in both the US and Canada, 55% of budtenders who had worked at any point in the past 12 months “had left by the end of that period.”

“There’s this underlying feeling that the cannabis retail industry is immune to all other retail trends in the traditional business, and it’s not,” said Marc Rodriguez, president of Greenleaf Business Solutions, a San Diego-based payroll and human resources services company for marijuana offers companies.

fix the problem

According to Rodriguez, part of retaining employees in the cannabis sector is legitimizing the employee experience.

Many marijuana employees are still paid in cash, and many jobs don’t have modern benefits like online payroll or 401(k) plans.

There are companies that offer these types of services to cannabis businesses, but they’re less common than in the mainstream industry.

“There is access to these things, but they cost,” Rodriguez said.

“They’re expensive, and they’re a lot more expensive than any traditional retail store or any traditional business that wants the same thing.”

He estimates that he spends an additional $60,000 a year on cannabis-based payroll and employee services.

Jim Finkelstein, CEO of California-based compensation consulting firm FutureSense, said employee retention is more about good leadership, good pay and good benefits.

“The main reason people leave is generally because they don’t like their boss or don’t feel like they’re getting the tools they need to nurture their own personal skills,” Finkelstein said.

“You have all these dials – environment, culture development, reward. They will have a huge impact on (sales).”

Some companies are planning high sales in the cannabis space — a business strategy known as “come, contribute, go.”

However, Finkelstein said this strategy hurts business owners in the long run.

“It’s a legitimate business strategy,” he said. “On the other hand, come, contribute and stay is probably a better business strategy because then there’s the cost of sales.

“It’s not just the hiring costs. It’s the gap of not having anyone on the line, not having anyone on the front desk, the opportunity cost of having to retrain people.”

Learn from older markets

According to Finkelstein, if cannabis retailers want to improve employee retention, they can learn from strategies that have worked in the past for mainstream names like hotel operator Marriott International.

“For example, we know that Marriott has been very successful at keeping housekeepers over the years,” he said, “because they had a profit-sharing program that after a 30-year career at Marriott Corporation, you can get away with a quarter of a million.” Dollar.

“You have to tell them how important their work is to the customer experience. They have to be acknowledged. They need to be trumpeted out there as being so valuable to the whole process.”

Both Rodriguez and Finkelstein compared marijuana retail to traditional retail because the majority of sales occur in entry-level positions like budtenders.

Therefore, a budtender can be compared to salespeople in clothing stores in terms of the type of employees the position attracts.

“Not everyone is going to come in here and work full-time,” said Duncan Ley, owner of California Street Cannabis Co. in San Francisco.

“Maybe you’re a student, or maybe you’re a mother, or maybe you’re an artist.”

Ley described its customer retention as “super low” but remained positive on the matter, comparing low customer retention to another thing retailers need to adapt to.

“I’m not going to pretend like I didn’t have to fire someone (recently) just because I did,” Ley said.

“We have to get people excited about them. And then when they go, I want them to move on to something better and different.”