Unemployment rates in America are at an all-time high thanks to the global spread of COVID-19. The U.S. jobless rate hit a post-World-War-II high of 14.7 percent in April, then fell to about 13.3 percent in May. Yet, in cannabis, this pandemic is playing out much differently than elsewhere.
Virtually all legal states declared medical cannabis an essential service. Cannabis sales surprisingly experienced a striking uptick. True, there have been layoffs in the industry— MedMen and Organigram are some of the most well-known examples—but most businesses are doubling down and weathering the storm.
Cannabis companies are responding to this unprecedented crisis in unprecedented ways. The COVID-19 strategies in the industry are worth talking about, as many of the approaches in cannabis have applications well beyond the sector.
Be flexible
Cannabis is an industry with a history of working through extraordinary challenges. This background has allowed many cultivators, manufacturers, and retailers to pivot quickly during COVID-19.
The legal landscape has evolved steadily over the past decade. Unexpected regulatory changes are nothing new for anyone working in this industry. As temporary lockdowns and social distancing requirements have come into play across the country, the cannabis sector quickly and intelligently responded. These shifts are just another bump in the road while getting products to customers in a safe and legal manner.
Standing behind your team makes your team more willing to stand behind you.
Practically speaking, COVID-19 changes have meant cannabis retailers are adapting to alternative strategies like online sales, delivery, and curbside pickup. OG Cannabis Cafe, in West Hollywood, California, is one such example of a company with quick reflexes. Local lockdown protocols meant a substantial part of the company’s business, the café, was closed. The operation became the first drive-up location in the state, offering both take-out food and cannabis curbside to keep its clientele happy and fully supplied.
Support your team
At Platinum, we quickly responded to the need for added safety measures by issuing personal protective equipment (PPE), adjusting workflows to ensure social distancing, and implementing other precautions. Furthermore, the executive team delivers lunches to the entire team to help with staff morale.
Our approach contains lessons for others, both inside and outside the cannabis sector. As the unemployment rate clearly shows, the novel coronavirus has created a global state of uncertainty, especially for workers. By providing clear commitments to the team, companies can reduce any looming sense of insecurity and, therefore, staff stress levels. Even if the pandemic continues to produce uncertainty, your employees will know where the company stands. Standing behind your team makes your team more willing to stand behind you.
While it might not be possible to provide daily lunches, even small gestures during this time can mean the world to your team. What small steps can you implement to keep up morale and show your staff some appreciation?
Assess the supply chain
Product shortages have hit both consumers and manufacturers hard during the pandemic. Disinfecting wipes, hand sanitizer, and toilet paper are not the only products that have been disrupted. Many companies, cannabis businesses included, have seen delays and shortages for integral components sourced from China. Lockdowns across the globe have meant severe shipping delays for raw materials and parts, especially packaging and vape cartridges.
The Institute For Supply Chain Management noted almost three-quarters of companies surveyed reported COVID-19-related supply issues, but few had any contingency plans. Although the scale of this global pandemic may have been hard to predict, some companies did see the early warning signs and took precautionary measures.
As early as January, we saw the signs of disruption coming out of China, where we source CCELL components for our line of vape products. We erred on the side of caution rather than waiting to see how the virus would play out. We ordered early and in substantial quantities, which have thus far gotten us through the supply issues faced by others.
Of course, Platinum isn’t the only cannabis company benefiting from careful risk assessment.
Others in the industry have structured their entire business around cautious supply chain management. Vertical integration from seed to sale has insulated many companies from the whims of a volatile market, particularly apparent today. COVID-19 has demonstrated just how necessary supply chain risk assessment is, inside and outside the cannabis space.
Valuable lessons
The tumultuous history of legal cannabis is helping this industry not only survive the global pandemic but also, in some cases, thrive. Over the years, cannabis businesses have had to stay flexible, and that is proving a highly useful skill in today’s strange times. Successful companies always have an inherent ability to pivot when necessary.
Beyond flexibility, other key lessons are worth replicating elsewhere. Cannabis can teach other industries to double down on support for employees and, perhaps most importantly, create a robust supply chain capable of weathering any storm—even a viral one.
George Sadler and his son Cody Sadler are co-owners of Platinum, a manufacturer of top-selling vapes in Michigan and California. The company also produces chocolate bars, gummies, flower, and pre-rolls.
