Indie Retailing 101: How to Stay Afloat During a Downturned Economy
With economists expecting a recession, it's hard not to feel discouraged, especially if you're an operator in cannabis-retail-saturated Ontario.
What can you do to ensure your business stays afloat during a downturned economy? We've compiled a few ways that may help.
#1 - Don't Neglect the Customer
Whether times are good or bad, you should never neglect the customer.
This is obvious, right?
Often, retailers create customer loyalty programs and promotions to attract customers. But these can be costly if they're not genuinely meeting your customer's needs.
A refocus on the how and why of customer preferences is vital. Are they shopping with you for a specific brand they can't find elsewhere? Are you in a favourable location?
Maybe you have the friendliest and most helpful budtenders.
After their purchase, ask the customer why they shop with you. This feedback is essential for forming a business strategy during a downturned economy.
What separates you from the competition? Find the reason customers shop with you and emphasize it. Embracing this "why" keeps your customers returning for the long haul.
#2 - Don't Neglect Marketing
When you have to cut the budget, marketing is often the first to get axed. But this is a mistake.
While lawmakers restrict cannabis retailers from a lot of marketing and advertising, there are still avenues to explore.
If you pull back on marketing, you're taking yourself off the customer's radar. Out of sight, out of mind apply here.
Simply put, recessions are an opportunity to build customer loyalty. How can you do this?
Essentially, you want to create an experience. Your store should be more than just a place to buy cannabis.
Is it minus thirty degrees outside? Offer your customers a complimentary cup of coffee or hot chocolate. You want to make a connection and elicit an emotional response.
Every retailer has access to the same catalogue of cannabis products. You can differentiate yourself by giving your customers an experience.
#3 - Cut Costs
Cutting costs is obvious, right? And what better opportunity to identify and reduce burdensome costs than a recession?
Every business will have specific costs that may or may not be relevant to you. But you'll want to avoid cutting costs essential for providing a positive customer experience.
Which means ensuring you have enough staff.
It's common for retailers to cut back on staff during a recession. Suppose this means customers wait 10-15 minutes to buy their favourite cannabis strains. They may forgo your store and buy online if that's the case.
Recessions are a time to focus on becoming more efficient. They are also a time to look for investment and growth opportunities. You can lock into lower rents. Maybe find better lease terms.
#4 - Stay Informed
Don't neglect the customer, don't neglect marketing, cut costs wisely, and look for growth opportunities.
These simple but effective strategies are just one of many Burning Tree can help you with. Our experience, knowledge, and private-label products can ensure that you not only weather the storm but come out on top.
What's the Toke Away?
CUSTOMERS - When the market tightens up, drill into your customer's need and hyper-focus your efforts to cater to them.
MARKETING - Cutting your marketing budget can make you appear invisible to your customers. Keep yourself present and think about other ways to create interest and traffic.
COSTS - Focusing on lowering your hard costs and the cost your customers encounter can make your store a more attractive option.
Interested to Learn More?