For this week’s Power Players interview we spoke with Ross Lipson, CEO of Dutchie, an online ordering platform used by more than 1,300 dispensaries in the U.S. and Canada. The company says it has seen a 700% spike in order volume since the pandemic arrived.
Here Lipson discusses the problem with “Apple store” dispensaries, the future of delivery and what the most successful pot shops have in common.
This interview has been edited for length and clarity.
WeedWeek: What does Dutchie do?
Ross Lipson: Dutchie is an eCommerce solution for the cannabis space. We power the online ordering for over 1,300 dispensaries across North America, allowing consumers to order for delivery or pickup in both REC and MED states.
WW: Are most of your clients big MSOs or mom-and-pop shops?
RL: We don’t have a preference. As long as you’re a cannabis retailer, we’d like to work with you. We work with a lot of MSOs, but also the mom-and-pop’s as well.
WW: Who do you consider your competitors?
RL: There’s a few, and I’ll bucket them. There’s Leafly and Weedmaps. They’ve been around for a long time and they have a bit of a different focus than just solely online ordering, which is our focus. They do things like dispensary reviews and strain reviews.
In a sense, they are competition. They have an online ordering product. But I have a different focus and vision. We’re very laser-focused on just doing one thing perfectly: online ordering for the cannabis space.
Jane‘s another competitor for us. They do online ordering in the cannabis space. They started a few years before us.I don’t know too much about the company, but I’ve met CEO Socrates [Rosenfeld], he’s the CEO. He’s a great guy, and my hat’s off to them, for sure.
WW: My understanding is they’re do it mainly through the brand sites, and you’re doing it through the dispensary sites. Is that correct?
RL: Correct. Our focus is definitely providing value to the retailers. Our thesis for the cannabis space, is that the retailers will always exist. And we, as a industry, rely on them. They’re the point of purchase for the consumers. Also the value is kind of chained to the one that holds the product, right?
One of the ways we provide value to the retailer is by offering them a private label online ordering experience that integrates directly into their point-of-sale. So it creates an automated, seamless, online ordering experience for their consumer that’s embedded into their dispensary website.
A COVID-related spike
WW: Is that typically done for pickup, or for delivery or both?
RL: Both. Now a majority of our orders are pickups, simply because delivery has been a bit slower to roll out than everybody expected. There’s only a handful of states that offer it today. So majority of our orders are pickup. However, I think it’s fair to say most people believe, and I’m one of them, that the future of cannabis will show a far higher adoption of delivery then than we see today.
WW: So how has the pandemic changed your business?
RL: It was a curveball that kind of hit us all. Fortunately for our sector, online ordering, our tool we provide proved to be really valuable during this pandemic. We offer curbside as an option for ordering as well as delivery. And we really limit the time the customer has to be in the store.
When COVID hit in mid-March, our order volume and counts surged. We grew over 700% in order volume through the pandemic, and had a huge adoption of retailers showing interest and wanting to sign onto our platform.
The Problem with “Apple Store” dispensaries
WW: If a dispensary wants to sign up with you, how does that work?
RL: Yeah, so it’s a really quick and easy, frictionless onboard process. It takes no longer than 24 hours to onboard onto Dutchie. An implementation specialist at Dutchie will pair with the dispensary to walk them through the platform, make sure that they have the tool embedded into their website correctly. They also ensure the dispensary has our hardware, a receipt printer that prints out orders, and a little iPad mini to manage the order flow at the store.
They’ll also walk through a few test orders, train staff before they launch, and really just give them that white glove treatment that the retailer deserves. We typically can launch within a 24 hour time frame, depending on how fast the retailer wants to launch.
WW: Other than following good business practices, are there any sort of things that the dispensaries, the retailers, that are doing well have in common? And something that the retailers that are struggling with have in common?
RL: The most successful retailers I’ve seen are actually taking a very simple approach. And then there’s the opposite. There’s a lot of retailers that are over-complicating things.
A few things pop up here. One is in-store experience, aking sure people can come into the store, place their order and move through the process quickly. A lot of them have done that using our tool and others through an express pickup line.
The idea of having that Apple-like experience in a store, has not yielded the results that aesthetically it does. From the bottom-line standpoint of revenue, it doesn’t. It’s the dispensaries that keep it quite simple, that I find do far higher volumes.
The same is true from a technology standpoint. [The most successful retailers keep it simple. There are some dispensaries that have really clean, easy to use web site and I see they have far higher volumes than the dispensaries that try to over-complicate it. That’s a theme I’ve seen across all states.