Building Stronger Retailer-Brand Partnerships in Cannabis

Human connection is the lifeblood of social creatures. But what happens when this is threatened? The cannabis industry stands at a crossroads. Our innate drive to form relationships and build communities is being tested, where the stakes are high and the ground is still shifting beneath our feet.

Picture this: A retailer, a brand, and a budtender, each pulling in their own direction like players in a high-stakes tug of war. Sound familiar? This scenario plays out daily in the cannabis industry, echoing the famous "prisoner's dilemma" where individual interests often trump collective benefit.

As the cannabis landscape evolves, with competition intensifying and product choices multiplying these three key players find themselves entangled in an increasingly complex web of relationships. But what if we could rewrite this story?

Imagine a world where instead of adversaries, these players become allies. Where collaboration replaces competition, and shared missions drive success. It's not just a pipe dream—it's a potential game-changer for the entire industry.

In this blog, we'll explore strategies to transform these critical relationships from competitive to cooperative. We'll uncover how fostering stronger partnerships can lead to better outcomes for everyone involved—retailers, brands, budtenders, and most importantly, the customers they serve.

1. The Prisoner’s Dilemma: Understanding the Relationships

Imagine a game where playing it safe leads to losing, and trust leads to winning. Welcome to the prisoner's dilemma—a paradox that's silently shaping the cannabis industry.

What is the Prisoner’s Dilemma? A situation where two or more characters have two choices: cooperate with each other, or betray each other. Unfortunately for them, although everyone cooperating would be better than everyone betraying, they would individually be better off betraying.

In the bustling world of cannabis retail, this dilemma unfolds daily. Retailers and brands, each focused on their own business objectives, often find themselves trapped in a cycle of self-interest. 

A retailer wants to stock their shelves with diverse products that'll have customers returning. Meanwhile, brands are pushing to get their products front and center, and then throw budtenders into the mix—the vital link between product and purchaser—becomes complex.

But here's the kicker: when everyone's solely focused on their own gain, it's not just the relationships that suffer—it's the entire ecosystem, including the all-important customer.

So, what's the solution? It's time to flip the script.

Instead of viewing each other as competitors in a zero-sum game, retailers and brands need to see themselves as partners in a shared adventure. By aligning goals and working together, they can create an experience that truly resonates with customers.

Pro Tip: Encourage your team to view brand relationships as partnerships rather than competitions. By aligning on mutual goals, both parties can succeed in delivering value to customers, leading to stronger long-term outcomes.

2. The Role of Budtenders in the Retail-Brand Dynamic

Budtenders sit at the center of the retailer-brand relationship, often acting as the primary touchpoint between the product and the customer. But this also puts them in a tough position—they’re expected to balance the interests of both the retailer and the brand while serving the customer. In some cases, budtenders may feel pressure to prioritize certain brands or products, even if those aren’t the best fit for the customer.

This can create a transactional environment where budtenders push products to meet sales goals rather than focusing on the customer’s needs. 

A transactional relationship rarely leads to customer loyalty. Budtenders should be empowered to make informed, unbiased recommendations that serve the customer’s best interest, rather than acting as a sales agent for specific brands.

Pro Tip: Train your budtenders to understand their crucial role in the retailer-brand dynamic. Give them the tools and knowledge they need to confidently recommend products that fit the customer’s needs, rather than just meeting sales quotas.

3. The Evolution of Product Education for Budtenders

In the early days of cannabis legalization, product education was often conducted in person, with brand representatives visiting dispensaries to train budtenders. As the market has expanded, digital tools have become more common for training, making it easier for retailers to access product information and updates.

Quick-hit product training may not equip budtenders with the education and understanding they need to recommend the right product for each customer’s needs and their set & setting. 

A more effective approach is to invest in ongoing education so Budtenders can guide the customers through the menu to help them choose the right products for them. Not just the products the Budtenders are most comfortable with. Recommending the right products based on their needs, lifestyle, and preferences will, in turn, build customer loyalty.

Pro Tip: Invest in continuous product education that helps budtenders become solution-oriented sellers. By providing deeper insights into products and their benefits, you’ll equip your team to offer more personalized recommendations that keep customers coming back.

4. The Importance of Retailer Philosophy

A successful cannabis retail operation needs more than just a wide variety of products—it needs a clear mission. Retailers must define their philosophy and North Star, whether it’s high-volume efficiency or high-touch, personalized service. This guiding principle should inform every aspect of the business, from product selection to customer interactions.

Without a clear philosophy, it’s easy for retailers to get caught up in the day-to-day transactional nature of the business, focusing solely on moving products without building lasting relationships. By contrast, when retailers have a clear mission, it not only makes product decisions easier but also helps build stronger, more meaningful relationships with customers and brand partners alike.

For example, a store that prioritizes high-touch customer service might partner with brands that offer premium products and invest in deeper budtender education. On the other hand, a store focused on high-volume sales might prioritize brands that can consistently provide a large selection of products at competitive prices. Whatever your dispensary model is, having a clear philosophy allows for more strategic decision-making and better alignment with brand partners.

Action Tip: Clearly communicate your store’s mission to both your team and your brand partners. Align your strategies and partnerships with this North Star to create consistency in customer experience and product offerings.

5. Developing Effective Trade Programs

Trade programs offer a win-win opportunity for both brands and retailers. A well-designed trade program creates clear expectations around how products will be represented in-store, the level of inventory commitment, and staff education. This allows both parties to collaborate on ensuring that products are stocked, priced, and promoted in a way that benefits everyone.

For example, a brand might negotiate with a retailer to ensure its products are prominently displayed in-store, while the retailer can count on consistent stock levels and support with in-store signage or promotions. Part of a successful trade program is ensuring that budtenders are educated on the product’s key features and benefits, allowing them to confidently recommend it to customers.

Brands that invest in strong trade programs see better product performance and customer engagement, while retailers benefit from having reliable partners that contribute to the overall customer experience.

Action Tip: Develop or refine trade programs that provide real value to both brands and retailers. Focus on key areas such as product visibility, in-stock guarantees, pricing parity, and staff education to create a mutually beneficial relationship. Leverage core partners to support your loyalty program offering, increasing overall value while reducing the burden on margins.

6. Avoiding Transactional Relationships

One of the biggest mistakes retailers and brands can make is focusing solely on transactional relationships—where the goal is simply to move as much product as possible in the shortest amount of time. While this approach may boost short-term sales, it often results in lost customers and missed opportunities for repeat business.

Cannabis customers are looking for more than just a transaction; they want a personalized experience that helps them find the right product for their needs. Retailers who take the time to build relationships with their customers, offer tailored recommendations, and create a welcoming environment are more likely to see those customers return.

Similarly, brands that focus on creating lasting partnerships with retailers—rather than just getting their products on the shelf—will see better long-term results. By working together to prioritize the customer experience, both parties can benefit from increased customer loyalty and sustained growth.

Action Tip: Shift your focus from one-time transactions to building long-term customer relationships. Train your budtenders to provide personalized recommendations and invest in creating a welcoming store environment that keeps customers coming back.

Conclusion

Building strong relationships between retailers, brands, and budtenders is essential for sustainable profitability. By moving away from transactional dynamics and embracing a partnership mindset, retailers and brands can work together to create a better customer experience, drive repeat business, and ensure long-term success.

For Store Managers:

• Build Strong Partnerships: Focus on creating mutually beneficial trade programs with brands that align with your store’s philosophy and customer base.
• Reinforce Your North Star: Clearly define your mission and communicate it to your team and brand partners to ensure alignment across all business activities.
• Invest in Budtender Education: Ensure your team is equipped with the knowledge and tools they need to provide personalized recommendations and build lasting relationships with customers.

For Budtenders:

• Continue Your Education: Stay curious and keep learning about the products you’re selling. The more informed you are, the better you’ll be at making recommendations that fit the customer’s needs.
• Understand Your Role: Remember that you are the key connection between the brand, the retailer, and the customer. Focus on building trust with customers by making authentic, unbiased recommendations.
• Focus on Customer Relationships: Don’t just aim to make a sale—aim to create a positive experience that keeps customers coming back. Building strong relationships is the key to long-term success.

By fostering a cooperative mindset and focusing on long-term relationships, retailers, brands, and budtenders can create a healthier, more successful cannabis industry—one that benefits everyone involved.