In the world of advertising, shopper marketing is a term used to describe a marketing practice that improves the shopper’s experience. Shopper marketing is influenced by elements such as window displays, aisle width, the placement of products on shelves, and, most importantly, the layout of your store.
Cannabis dispensaries can benefit from a strategic store layout across a variety of key metrics. The layout of your cannabis store impacts how you schedule and utilize your employees, control your inventory, and serve your customers.
This guide will give you a quick rundown of the considerations every dispensary needs to know when optimizing their store layout, as well as a few examples you can put to use.
Dispensary Layout Considerations
The layout of your cannabis dispensary is influenced by a few key components. These include:
- Hardware and technology
- Furniture, fixtures, and equipment (FFE)
- The physical design and customer flow
Hardware and Technology
Hardware and technology in your cannabis dispensary includes everything from the point-of-sale system (POS) to security cameras. Don’t skip on your hardware investment, as these pieces of equipment can most directly impact the customer experience. Using outdated POS software & hardware, for instance, can delay the checkout process and force customers to wait in long lines – not great for encouraging return visitors. Make sure you buy a piece of technology that’s the most recent model and is guaranteed to work for a long time.
Our experts also recommend that you pick a tech set-up that’s flexible. Whatever platform or tool you invest in, make sure it’s adaptable to other hardware and software tools. Switching POS providers or updating hardware can become expensive if your technology is only usable on specific platforms. With an average of four or even eight POS systems per dispensary, that cost $1,500-$2,000 each, your cost of changing will not be small!
Your internet connection is important for your operations and for your customers. Plan to pay for a commercial-grade Wi-Fi connection that can send your security video logs each day. California mandates security video archival requirements of 1280x720, 15fps with a 90 days archive. Also, don’t depend solely on Wi-Fi for your internet needs: try to hardwire as much of your technology as possible to ethernet or a landline, including your cameras, computers/POS systems, printers, menu boards, and whatever else you need consistently. If you lose Wi-Fi due to a router configuration error or bad firmware, then your day is going to be very painful.
At minimum, every cannabis dispensary needs to make sure their printer is hooked up to a reliable internet connection. Printing is a big part of running a legal cannabis operation: you need to provide labels for products, receipts for clients, METRC tags, and more. Your printer is a vital piece of technology that may not seem important, but can quickly ruin a customer’s experience (and your business’s compliance) if you don’t have one up and running.
Furniture, Fixtures, and Equipment
Furniture, fixtures, and equipment (FFE) may seem like they have a time and place on HGTV. But cannabis dispensaries can benefit from investing in their FFE to capitalize on branding and improve their shopper experience. FFE communicates your brand, the vibe of your store, and can help customers get answers to their FAQs (think form AND function).
For instance, some dispensaries add a dedicated corner to their store designed to provide education. You could set up an iPad or kiosk that offers a quiz or survey to help a customer find the product that best fits their needs. Or, let them explore your product offering by the desired effect, or have a dedicated staff member to handle all pre-ordering questions. This type of space is especially important in markets where the general public has little to no knowledge of cannabis such as markets just getting started with medical cannabis.
In addition to this space in your store layout, make sure product labels and displays make it easy for the customer to find what they need. It’s a basic tenet of shopper marketing. According to one statistic, 20% of shoppers report changing their minds about a purchase after being influenced by in-store media. Think about how you can guide customers around the store with an experience, not just provide them information about a product.
Likewise, the way you display your products influences someone’s purchase decision, both overtly and subconsciously. Digital menu boards make it easy to highlight a product, run a promo, and update inventory on the fly. Display cases can be used to spotlight a product or provide a “sample.” There are many options here: will you use jars, plates, or something more creative? How you show off your products says something about your brand.
Finally, new entrants to the cannabis market need to factor in potential future expansion plans. How are you planning to transition when recreational cannabis becomes legal? Will you need separate checkouts? Will you need to keep a separate inventory? These considerations become important when you start adding walls and fixtures that might not be moveable in the future.
Physical Design & Layout
In this section, we’ll walk through three examples of how your cannabis dispensary could set up its layout, additional thoughts around each of the layouts. The three models are:
- The bank model
- The pharmacy model
- The open retail model
The Bank Model
This store layout mimics a bank; customers enter, check-in at a front desk, and wait in line to be helped by a budtender. Budtenders show inventory, finalize the sale, and fulfill the order.
There are a few inventory considerations inherent in this model. First, you have two options: 1) budtenders keep track of their own individual inventory, or 2) they must share some inventory between a few budtenders, or 3) all share one inventory.
Option 1 and 2: Giving inventory control to each budtender or a group of budtenders, your customer experience can be improved and individual transactions can be completed faster, but it does take longer to prep and close out each day for inventory counting. With option 3, a central inventory: you will reduce the amount of waste and diversion of product because fewer people will have access to dispensing products and can make opening and closing the day out much quicker.
The bank model is the most popular layout among cannabis dispensaries. The customer directly interacts and builds a relationship with your budtenders and everything gets taken care of in one interaction: from answering a customer’s questions to order fulfillment. It’s a relatively efficient and friendly layout for many cannabis dispensaries.
The Pharmacy Model
In this layout, the customer checks in at the front desk, takes a number, and waits in line to be helped. The budtender finishes the previous sale and gives a claim ticket to the client, then helps with the next customer number waiting in line. A central inventory center will take claim tickets, fulfill the order and give the customer their product.
The main benefit of this model is that there’s excellent inventory control. It’s quick to set-up and closeout each day, and your operations benefit from having a few people designated as responsible for your products. This also allows your workers to specialize in certain duties. For example, if someone is a great sales person, they can focus on JUST that task and charm customers and move them through the line as quickly as possible.
One final consideration is client tracking. It’s important that when using a pharmacy layout, you have a way to make sure each customer is who they say they are. They may need to present their ID more than once, beyond check-in, depending on your state and local regulations (e.g., at check-in, when meeting a budtender, and picking up their order at the central inventory). One way to mitigate this is by having a unique identifier on the receipt such as an order or claim number – but make sure your team speaks about this protocol AND sticks to it.
The Open Retail Model
This layout is similar to an Apple store: products are out for display for customers to interact with and browse at their leisure. At a dispensary, the customer would check-in at the front desk. Budtenders would roam the store answering questions and helping to fill a virtual cart for customers. (Of course, you could have actual baskets for your shoppers, but this adds complexity in your store layout). Once the customer is ready to check-out, they head to a separate area to pay and have their order fulfilled.
This layout may seem appealing, but we strongly recommend using a virtual cart paired with a single inventory area for the sake of inventory control. You must have a protocol in place to reduce the risk of theft or waste. This layout can be incredibly complex, and our experts typically see a much slower transaction volume relative to other layouts, but a higher than average transaction size.
This layout is great for a premium style dispensary. It puts the customer experience first and foremost and can allow your staff to go deep with each client to address their needs and have a real conversation. Compare this model to speaking with someone through or over a display case. Clearly, an open layout lends itself to a much more personal interaction. It does, however, require a fair number of staff members to be available to make sure the experience is as seamless as possible.
There’s no single way to configure your cannabis dispensary layout. When you consider how to best set up your store, put yourself in the shoes of your customer and look for ways to help them enjoy their shopping experience.
If you need help with designing your dispensary layout for the best financial results, please reach out to us today!