Stephen Rechif: Operating a Community-Focused Cannabis Dispensary

Stephen recently answered some of our questions about Bloom Room‘s success story, day-to-day operations, company culture, and more. Check out the following Q&A for an in-depth look at the management and business strategies behind one of San Francisco’s most successful cannabis retailers!

Ganjapreneur: How long has Bloom Room been in business and how many people do you currently employ?

Stephen Rechif: Bloom Room has been in operation at our beautiful storefront location in downtown San Francisco since February of 2013. We are about to celebrate our 7th year of operation. The owners of Bloom Room have owned and operated licensed dispensaries in San Francisco since 2009. Bloom Room currently employs 25 working professionals in the Bay Area.

How would you describe Bloom Room’s company culture?

Bloom Room operates with one word at the center of its core values: authenticity. There isn’t a single person at Bloom Room who isn’t passionate about cannabis on a personal level. Cannabis consultants at Bloom Room are taught from the start that they need to have an authentic relationship with the cannabis we offer in order to make effective recommendations to our members. Our team of consultants is encouraged to experiment with all our new products and share their personal experiences with our members. Consultants are never pushed to sell certain products based on profitability or other external forces. Instead, our consultants are trained to be good listeners and recommend products based on each individual’s tastes, needs, medical conditions, and budget.

What are your primary customer demographics? Do you serve mostly locals, tourists, or a combination of both?

Bloom Room is located near the financial center and tourist center of San Francisco so our demographics generally target those who work in the area and those visiting from out of town. However, we have a strong group of loyal local customers who are the foundation of our member-base. Many local Bay Area residents travel from very far and pass dozens of other dispensaries to visit the Bloom Room — it’s a special pleasure to assist these members.

What do you do for marketing, and what marketing channels have you found to be most successful?

Bloom Room makes small marketing investments in online listings and print. We stay in touch with our members through our informative weekly e-newsletter and have a great text message campaign to promote our monthly Sale Events. However, our greatest marketing asset is our members! We rely heavily on word-of-mouth. We’ve found that if we focus on treating every single member with outstanding customer service and respect, they’ll do our marketing for us.

Does Bloom Room do community outreach or events? If so, what impact has this made on your business and relationship with the community?

Bloom Room strongly believes in the power of community and community involvement has always been a pillar of our operations. Over the years, Bloom Room has offered a wide variety of free member services like free massage, chiropractic, reiki healing, and informational cannabis workshops. Bloom Room also partners with local non-profit community organizations to accomplish local goals in our neighborhood. We do this by holding volunteer events twice a month and successfully encouraging our members to get involved in their community. We believe that cannabis can be a model for other industries by adhering to the values that have been the foundation of the cannabis industry since it’s inception in San Francisco in 1996; compassion, professionalism, and authenticity.

What have been the biggest challenges moving from the Prop 215 medical cannabis market to the Prop 64 recreational industry?

Having owned and operated a licensed cannabis dispensary since 2009 we’ve found many of the new regulations to be overly burdensome. Mainly, because we had been operating a fully legal and licensed dispensary for so many years beforehand without any issue. We’ve been contributing members of our neighborhood with strong support from our community before the regulations and we continue to be models of responsible, professional business community members. The greatest challenge with adopting Prop 64 was breaking with all the expectations from both customers and employees that had naturally developed after years of operation under medical use. Nevertheless, we are grateful to be able to serve the greater adult public. We are excited to see the massive wave of cultural acceptance that has swept the nation in response to legal recreational use.

How long has Bloom Room SF featured a vapor lounge? Have you faced scrutiny from the city or state for allowing customers and patients to use a vaporizer on-site?

Bloom Room has been permitted to have a Vapor Lounge since our opening in 2013. However, recently, the City of San Francisco has forced us to close it down. Basically, the Department of Health was permitting our vapor lounge without consulting with the Department of Planning for 7 years. When our new lounge licensing came up under the new framework, the City decided to close the lounge after 7 years of documented inspections noting vaporization and presumed authorizations based on verbal confirmation and absence of citation from the DPH Inspectors. Nevertheless, we’ve converted the vapor lounge space into more retail and product demo space which has been great for our operational efficiency.

Do you have any tips for buyers and dispensary managers looking to procure inventory that inspires sales and return business?

Build strong financial systems with checks and balances. If you can’t pay your vendors on time, every time, you’re not going to be getting the first call next time they have something special. In over 10 years of operation, we are proud to say that we’ve never been late to pay one of our vendors — not once. This type of consistency allows us to have the first right of refusal for products produced by California’s best and most reputable brands.

Do you work out deals with farms and producers to get the first look or exclusivity with new genetics, flavors, or products? If so, how do you establish these relationships and how do you choose which producers to partner with?

It’s important that a dispensary operates as a market place with the buyer being the centerpiece. An effective buyer needs to negotiate deals with farmers and producers, as well as value-added options like advertising collaborations, product demonstrations, and sale events. However, a good buyer needs to say no — they need to say no A LOT! Many buyers don’t have this control and end up with stagnant products and consignment debt. Only the very best cannabis products offered at the most competitive price should be making it to your shelves and if a buyer can’t tell the difference or can’t say no then they need to be replaced. Less than 5% of the product offered to Bloom Room by vendors actually makes it to the shelf. Being an informed, impartial, and effective filter of the 95% products that don’t belong on your shelf is the painstaking and critical job of the buyer. Full disclosure: I’m not the buyer!

The presence and availability of our senior management on the dispensary floor contributes greatly to our customer satisfaction and retention efforts, however, management can’t be there for every transaction. Therefore, we spend a great amount of time and effort investing in the training and professional development of our professional team of cannabis consultants. Bloom Room consultants are trained not to be just budtenders slanging trees but stewards for the cannabis plant. Having this common value system and belief is at the center our operational philosophy and it’s how we retain customers as well. As opposed to alcohol sales, a well-run cannabis dispensary needs to operate with the foundational belief that they are doing well by their customers and contributing positively to their mental, physical, and spiritual selves. Since consumers of cannabis know they are self-medicating in a productive way, they would never accept a cannabis dispensary that doesn’t share their same values and makes them feel like they are doing something wrong.