How to Sell to Dispensaries: A Starter Guide

Getting your cannabis products into dispensaries is crucial for growth in the booming industry, expected to exceed $100 billion by 2030. But with many brands vying for attention, it’s not straightforward. Here‘s a distilled guide to navigate this journey:

Understand the legal landscape, including state licensing, local laws, and compliance.
Conduct market research to understand dispensary needs, competitor analysis, and consumer insights.
Craft a compelling brand story and ensure your products are in line with market demands.
Ensure product compliance with required testing and quality standards.
Build dispensary connections through events, networking, and direct outreach.
Optimize your brand assets like packaging and marketing materials.
Consider leveraging distribution partners to ease the selling process.

Persist through challenges, focusing on quality and strong relationships with dispensaries to grow your brand.

State Licensing

Every state has its own rules for selling cannabis. You might need different types of licenses like:

A cultivation license to grow cannabis
A manufacturing license to make cannabis products
A distribution license to move cannabis around

Make sure to look into your state’s specific rules because they can be different from place to place. Getting a license usually involves things like background checks, paying fees, and sometimes inspections.

Local Laws and Zoning

Your city or town will have its own rules too. Things to check out include:

Where you’re allowed to set up shop (zoning rules)
How you need to run your business (like security stuff)
Local taxes and fees

Finding a spot that fits all the legal requirements is key. Also, local rules can change, so keep an eye out for updates.

Staying Compliant

Keeping up with all these rules is a big job. Here are some tips to help:

Keep all your paperwork organized
Follow all the rules about tracking, reporting, and checking your products
Stay updated on new laws
Make sure your licenses are always up to date
Get advice from experts like lawyers or consultants when you need it

Staying on top of the legal stuff means you can keep selling to dispensaries without any big problems. Remember, not following the rules can lead to big fines or even losing your license to sell.

Conducting Market Research

Before you try selling your products to dispensaries, it’s super important to do your homework. You need to figure out what’s already out there, what dispensaries are looking for, and what people want to buy that they can’t find yet.

Dispensary Requirements

To get a good idea of what dispensaries need:

Pick the dispensaries you’re interested in and find out where they are, how big they are, what kind of products they like, and so on.
Make a simple chart to compare these dispensaries. This helps you see which ones might be a good fit for your products.
Talk to dispensaries directly to learn what they’re specifically looking for when they choose new products.
Be ready to show them your licenses, that you follow all the rules, and that your products are top-notch.

Dispensary	Location	Size	Product Criteria	Other Requirements
Dispensary 1	City, State	5,000 sq ft	Organic, vegan options	Active social media presence
Dispensary 2	City, State	3,000 sq ft	High THC strains	Flexible order sizes

Competitor Analysis

Look at what brands and types of products dispensaries are already selling.
List out your main competitors and check out what they offer.
Think about how your brand can offer something different or better. Do you have unique products or something else that sets you apart?

Consumer Insights

Look into what customers are saying they want but can’t find.
Ask people what they like or wish for in cannabis products.
Create products that meet these needs and wants, focusing on things like health benefits or being eco-friendly.

By really understanding dispensaries, what’s already being sold, and what customers are looking for, you can make your brand stand out. Using facts and feedback to guide you shows you know your stuff and are ready to meet what people want.

Crafting Your Brand Story

Building trust and sharing your brand’s true purpose is crucial for making your cannabis products appealing to dispensaries. Here’s how to make your brand stand out by being real and reliable.

Establishing Credibility

When you’re new to the cannabis scene, it’s super important to show you know your stuff and that your products are top-notch. Here’s how:

Talk about any special training, awards, or experience you have with cannabis. This helps people trust you.
Be open about how you make and test your products. People like knowing what they’re buying.
If you’ve been mentioned in the news or by famous people, mention that. It makes a good impression.
Share reviews from happy customers. People listen to what others say.
Always follow the rules and keep your products safe and high-quality. Being in good standing is key.

Showing you’re trustworthy and serious helps your brand get noticed by dispensaries and shoppers.

Conveying Your Mission

Why you started your cannabis business and what you’re all about should be clear in your story. This helps attract the right people. Think about:

Telling your personal story with cannabis and how it led to starting your business. Keep it real.
Sharing stories of how cannabis has helped you or others. It makes people care.
Talking about the specific problems your products solve. It shows you understand your customers.
Highlighting your company’s values and how they match your customers’ interests. It brings like-minded people together.
Showing how your brand fits into the wider cannabis culture. It helps the right people find you.

A genuine story helps connect your brand with people who will love your products.

Product-Market Fit

It’s also super important that your products are exactly what your target customers want. Here’s how to make sure:

Really get to know your target customers and create profiles for them. Understand them deeply.
Make products that perfectly meet your customers’ needs and wants. Solve their issues.
Test your products with your target audience and use their feedback to make improvements. Keep tweaking.
Check that your products and the way you talk about them match your brand’s vision. Close any gaps.
Keep an eye on sales data to make sure your products are hitting the mark. Adjust as needed.

When your products and your brand story line up, it helps your business grow.

Ensuring Product Compliance

Required Testing

In California, before you can start selling cannabis products, they have to pass certain tests at labs that are officially approved. These tests check for:

Cannabinoid potency – They measure how much THC, CBD, and other cannabinoids are in your product.
Terpenes – They look at the natural compounds that give your product its smell and effects.
Pesticides and fungicides – They make sure your product doesn’t have any harmful chemicals on it.
Heavy metals – They check that your product doesn’t have dangerous metals like lead.
Microbes and mycotoxins – They check for mold, yeast, and bacteria to make sure your product is clean.
Residual solvents and processing chemicals – They make sure there aren’t any unsafe leftovers from making your product.

Some labs in California that do these tests are:

CW Analytical
SC Labs
Bureau Veritas

Always check that the lab is officially allowed to do these tests by the Bureau of Cannabis Control.

Quality Standards

To make sure your products are always top-notch:

Keep everything super clean when you make your products.
Use the best materials you can find.
Do your own checks to make sure your product looks, smells, and is as pure as it should be.
Store your products the right way so they stay fresh.
Listen to what customers say about how your product works and tastes.

Doing checks at different steps helps keep your products consistent.

Packaging Regulations

In California, how you package your cannabis products has strict rules:

Child-resistant – Your packaging can’t be see-through and must be tough for kids to open.
Prevent contamination – Your packaging has to be sealed and safe for food.

Your labels need to have:

Business/license info – Your company’s name and your license details.
Product details – How much is in there, what’s in it, and how strong it is.
Warnings – Reminders to keep it away from kids and not to use it before driving.

For all the details on packaging and labeling, check the California Code of Regulations Title 16, Division 42.

Establishing Dispensary Connections

Events and Networking

Going to cannabis events and meetings is a smart way to meet people who run dispensaries or make big decisions there. Here are some events worth checking out:

MJ Unpacked – A big event in Las Vegas that attracts people from large cannabis companies. It’s a good spot for networking.
Hall of Flowers – A well-known event in California that focuses on brand building and retail. Many buyers go to this one.
Local cannabis business mixers – Look on Eventbrite and Meetup.com for smaller, local events. These are great for connecting with dispensaries in your area.

At these events, remember to:

Bring your business cards and something to show off your products, like samples or a brochure
Find out who you should talk to by looking at the attendee list before the event
Have a quick pitch ready to explain what makes your products special
Follow up with the people you meet to keep the conversation going

Joining local cannabis groups can also help you meet the right people:

National Cannabis Industry Association chapters
State cannabis business groups
Local cannabis business clubs

Using social media, like Instagram and LinkedIn, can also help you get your brand noticed by dispensaries:

Instagram

Use hashtags like #dispensarybuyer to help people find you
Start conversations by liking and commenting on dispensaries’ posts
Suggest working together on special promotions

LinkedIn

Join groups where cannabis professionals hang out
Connect with dispensary managers and buyers
Share useful tips and stories to show you know your stuff

The goal is to make friends and share helpful information before you try to sell anything.

The Sales Process

Here’s a basic guide to getting your products into dispensaries:

1. Identify Target Dispensaries

Look up local stores and pick 5-10 you really want to work with
Find out important details like what they buy a lot of, who decides what to buy, and how to contact them

2. Make Contact

Call or email to get the buyer’s details and learn how they like to be approached
Send a simple email introducing yourself and your products

3. Send Samples

Offer to send them some free samples to try
Ask what they think and if they’re interested in ordering

4. Negotiate Terms

Talk about prices, how many they need to order, how to pay, and other details
Be willing to adjust to make the deal work

5. Fulfill First Orders

Make sure everything is labeled and packaged right
Send the order on time, make sure they got it, and handle the payment
Ask how things are going and if they need anything else

6. Ongoing Relationship Management

Keep an eye on how much they have in stock
Suggest special deals to encourage more orders
Listen to their feedback to make your products even better

Let me know if you have any other questions!

The Sales Pitch

When you want your products in dispensaries, you need a strong sales pitch. This means showing clearly why your products are great and building trust. Here’s how to nail your pitch to dispensaries.

Crafting Your Proposal

Put together a neat document that outlines everything about your brand and products.

Include:

A short letter explaining your main points
Info about your brand and what you stand for
Descriptions and pictures of your products
Lab test results
How you make and get your products
How much things cost and the smallest order you’ll accept
Rules and conditions

Formatting Tips:

Make it easy to read with clear headings
Use lists to point out important stuff
Keep it short – aim for 8-10 pages

Here’s a template you can use to get started.

Presenting In-Person

If you get to talk to dispensary reps face-to-face:

Do:

Practice talking about your products so you sound sure of yourself
Bring samples and your printed proposal
Explain your prices by talking about the good things your product offers
Be ready to answer questions about testing, where your products come from, etc.

Don’t:

Rush or skip over details
Get upset if they ask tough questions
Promise more than you can deliver

Being calm and ready with facts makes you look good.

Following Up

Don’t forget to check back in after your pitch:

Send an email the next day to thank them and go over the main points again
Give them any extra info they asked for
If you don’t hear back after a week, send another message
Keep in touch every 2 weeks if they seemed interested

It takes time and effort to build a good working relationship, but it’s worth it.

The Power of Samples

Giving away free samples is a key step in showing off your products and getting a dispensary to trust you. When you let them try your products for free, they can see for themselves if they like them before deciding to sell them. Here are some tips on how to handle samples, from how they look to following up.

First Impressions

How your sample looks really matters. Some advice:

Pick designs that stand out but still look professional and show what your brand is about
Make sure all the labels that the law requires are easy to read and correct
Use high-quality materials for your packaging that are safe for food and can’t be easily opened by kids
Give them 3-5 units of each product so enough people at the dispensary can try it

A well-thought-out sample can make a lasting, good first impression.

Demonstrating Effects

The main reason for giving samples is so the dispensary team can check out your product’s quality and effects themselves. When choosing samples:

Pick your best-selling strains and products that show off what you can do
For flower, choose buds that are cured well and show off the smell, taste, and strength
For things like extracts and edibles, highlight how you make them and the quality of your ingredients

Letting the product do the talking is the best way to show what you bring to the table.

Securing Shelf Space

If the dispensary team likes your samples, they’re more likely to sell your products. To turn those samples into sales:

Check back in a week to see what they think and if they’re interested
Be ready to talk about prices and the smallest order they can make
Offer a discount or special deals on their first order
Keep supporting them and stay in touch even after they make a purchase

Following up well and keeping a good relationship after giving samples is important for making those samples turn into a steady business.

Optimizing Your Brand Assets

Packaging Design

Your cannabis packaging should clearly reflect your brand story and values while meeting all legal requirements. Here are some tips:

Choose colors, fonts, and imagery that align with your brand identity. For example, earthy tones for an eco-friendly brand.
Make sure your logo and product details are prominently and consistently displayed. This helps build brand recognition.
Adhere to state laws regarding child-resistant packaging, labeling, warnings, etc. Consider working with a specialist.
Use premium, food-grade materials to reinforce quality. Avoid overly flashy packaging. Simplicity and elegance communicate maturity.
Feature unique selling points like organic certification, social causes you support, or product origin stories.
Prioritize readability and essential info first. Additional brand details should enhance, not distract from required elements.

Marketing Materials

Provide dispensaries with sell sheets, catalogs, and other assets to help educate and sell your products:

High-resolution product photos from multiple angles are essential. Lifestyle imagery can also connect with customers.
Include a sell sheet summarizing product details, sizes, pricing tiers, discounts, certifications and other key info important to buyers.
Catalogs, brochures and flyers allow you to tell a deeper brand story and feature a product lineup. Keep them short and scannable.
Supply store signage and display materials to help your products stand out on shelves. Provide digital assets they can also use online.

Consistency Across Channels

Maintaining a steady brand image across platforms helps reinforce your message:

Keep logo, color schemes, imagery and voice aligned on packaging, website, social media pages and any dispensary materials.
The feeling customers get from interacting with your brand online should match the in-store experience.
Make style guides available to dispensaries to reference when promoting your products on their own channels. Provide recommended copy, hashtags and handles.
Supply dispensaries with new marketing materials and digital assets as your brand evolves to keep messaging consistent everywhere.

Leveraging Distribution Partners

When you’re thinking about how to sell to dispensaries, you have two main options: go directly to the dispensaries yourself or use a third-party distributor who already knows them. Here’s a quick look at the good and bad sides of each approach.

Distribution Model	Pros	Cons
Direct to Dispensaries	– Keep more money from sales – More control over how your brand looks – Direct chats with the people buying your products	– Takes a lot of effort and resources – Hard to manage as you grow
Third-Party Distribution	– Use relationships the distributors already have – Focus more on making your product better	– Make less money because of fees – Might not represent your brand the way you want

Direct to Dispensary Distribution

If you choose to sell your products directly to dispensaries, you’ll make more money on each sale and have better control over your brand. However, this method requires a lot of work.

Benefits

You don’t have to pay someone else to sell your products, so you make more money.
You get to talk directly to the people buying your products, so they get to know your brand better.
You can build good relationships with dispensaries, which helps with future sales.

Challenges

It’s hard to find and connect with the right people to sell to.
Managing orders and getting new stores to carry your products takes a lot of hands-on work.
As your business grows, it’s tough to keep up with selling to more places.

Third-Party Cannabis Distribution

Using a distributor means they do the selling for you, but you’ll make less money on each sale because of their fees. Still, it can make your life easier in many ways.

Advantages

Distributors already know dispensaries and can get your products in more easily.
They handle selling your products from start to finish.
You have more time to focus on making your products better.

Drawbacks

You have to pay the distributor, so you make less money on each sale.
You’re relying on someone else to show your brand to dispensaries, which might not always go how you want.

In the end, if you’re just starting or have a smaller business, using a distributor might be easier. It helps you save on the effort and cost of getting into dispensaries. But if you’re more established and can manage the work, selling directly to dispensaries might be better because you’ll make more money and have more control over your brand.

Conclusion

Getting your cannabis products into dispensaries takes careful planning, sticking to the rules, and building good relationships. Here’s a quick guide on how to make it work.

Recap of Key Steps

Understand regulations – Look into your local and state rules about licenses, testing, packaging, and more to make sure you’re doing everything right. If you’re not sure, ask a lawyer for help.
Analyze the market – Check out what dispensaries need, what your competitors are doing, and what customers want. Use this info to make your products stand out.
Optimize branding – Tell a real story about your brand that people can connect with. Make sure your products live up to what you promise.
Make connections – Meet the people who decide what to sell in dispensaries through events and reaching out. Get to know them before you try to sell anything.
Create standout collateral – Impress buyers with great-looking branding materials, catalogs, and packaging that catches their eye.
Leverage samples wisely – Use free samples to show off the quality and effects of your products. Always follow up.
Consider distribution partners – Think about whether selling directly to dispensaries or using a distributor is better for you, depending on how big your business is and how much work you can handle.
Persist through rejections – Keep trying with new dispensaries and improve your products based on their feedback. Don’t give up.

By preparing well, focusing on building relationships, having great branding, and not giving up, cannabis brands can grow and become well-known. Even though it’s tough, the effort pays off for brands that offer quality products and build strong connections with dispensaries.

What sells the most at dispensaries?

The most bought item at dispensaries is the cannabis flower, making up 59% of all sales in the US and Canada. The money you can make from selling flower can be pretty good, with profits around 76% in some places.

How do you market a dispensary?

Here are some smart ways to get the word out about a cannabis dispensary:

Set up a program that rewards customers for coming back
Use text messages to let people know about deals and bring them in
Have a system where happy customers can refer others
Use social media, where allowed, to connect with customers
Try to get people who’ve bought from you before to come back with special ads
Use online ads that show up in search results or on websites

Why do dispensaries make you pay in cash?

Dispensaries often only take cash because the US government still says cannabis is illegal. This makes dealing with money from cannabis sales tricky for banks and credit card companies, so they stay away to avoid legal problems.

Where is the easiest place to open a dispensary?

If you’re looking to open a dispensary, these states are more welcoming because they have clear rules and have said yes to recreational cannabis:

Colorado
California
Oregon
Michigan
Massachusetts
Illinois
Washington
Nevada

These places have a good setup for the cannabis business, making it easier to get started.