7 Metrics That Matter For Marijuana Dispensaries

Posted by Patrick Vedder on

 

Some metrics are fundamental for the development of strategies and decision making, especially for new dispensaries where every $ counts.

If you want to increase sales in your business, you must pay close attention to certain details.

Below we discuss six crucial metrics that should be examined.

This analysis will allow you to create strategies that help achieve a significant increase in the sales at your dispensary.

What Budtenders Sell The Most

It's important to know which employees (budtenders) sell the most product and actually have a following or customer base that comes back to see them.

You might find out very quickly that the budtender your thought was going to do great isn't the right fit for your business.

Traffic Flow

Keeping track of transactions made and averaging it to determine the flow of traffic in each month of the year can be a tedious task.

But you do not have to worry: with the help of a point-of-sale software you don’t have to do that task, as it does everything for you.

The POS allows you can to examine the months of the year in which you sell more and those that you sell less.

It's crucial to accurately (as possible) predict how busy your dispensary will be on any given day.

In the months that you sell more you can employ more staff to be able to satisfy the demand during those times.

Top Selling Products

In addition to analyzing the traffic flow metric, you should also take a look at what are the top-selling items or most popular products.

Once you know which items are sold in higher quantity, you can take advantage of that information to help push sales.

Information is power and properly training your dispensary staff will help.

On the other hand, identifying products that do not sell much will allow you to reduce costs by ordering less of these products from distributors.

If a product is not being sold, you can definitely remove it or you can replace it with another one that is more likely to sell in your dispensary.

Numbers don't LIE.

Vendor Tracking

Who are your suppliers and what do they offer?

Paying attention to the vendor tracking metric allows you to really dig into what's happening with your dispensary.

And in reality, there are numerous actions you could take to increase the number of sales and make your cannabis dispensary more profitable.

The fact that sales are small can mean many things.

Important things to analyze are:

  • How fast is the product selling? 
  • How often are you re-ordering? 
  • Which suppliers produce the highest margins?

Now, if sales are at all time highs then this metric is not going to be as important.

Sales Per Transaction

How much are people buying per visit?

Many times this comes down to one simple fact.

Are you in an area where there are dispensaries on every street corner?

If so, then you can expect your sales per transaction to be low, simply because your customers can go to a dispensary anytime they want.

On the other hand if your dispensary is located in a rural area (where there aren't many dispensaries) then you can expect customers to buy more products at each visit - simply because they don't have easy access.

Again numbers don't lie and if your average sale to a customer is not where you want it to be, then you will need to offer more products and accessories (like edibles, bongs, etc.).

 

Time Per Transaction

This is an important one.

Obviously you never want to rush a customer (or rush a sale), but time is important, especially if you have a large staff being paid an hourly wage.

The slower and more time a sale takes, the lower the number of sales that employees can make.

In turn causing lost revenue for the cannabis dispensary.

As you probably already know, customers hate to wait in line at any business, and will be discouraged from going to your dispensary if the wait time exceeds say 5 minutes to get help from a budtender.

Referral Retention

Finally, you need to track the number of clients that were referred to your dispensary, whether the referral was an advertisement, a friend, or whatever the source.

This information may be available to you through the installation of point-of-sale software.

Once you know the number of people who came to your dispensary from referrals, you can determine if your marketing strategies are working.

For example, if you are paying Weedmaps and there are no clients coming from the ad on Weedmaps, then you might want to cancel your ads on Weedmaps.

In general, the costs for advertising and marketing are quite high, so you should be cautious and be dedicated to tracking referrals.

Analyze all of the money you spend in advertising and evaluate if each of them is worth it or, if on the contrary, it is a waste.


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