I’m seeing a lot of new grow operations hunting for sales reps in Michigan. Many of them seem like they are starting these huge operations without a lot of means for figuring out the sales end of things, and quite a few without their own dispensaries.
Does anybody have any straight commission comps on being a sales rep in this industry? I’m NOT talking an in house employee that gets salary + commission. I’m talking an independent rep that is selling someone’s product(s) to a dispensary. I know that brokers are seen as sort of vultures of the industry in a way, but like any other product, the cannabis business will need independent sales reps to forge relationships and make sales as it continues to evolve.
I’ve heard everything from 10% to 1%, but it would be helpful if anybody out there (even outside of Michigan) has some knowledge on this topic to share. If anybody has experience on a tiered type of payment system, that would be great also.
Hypothetical: Sales Rep John makes the first sale for Grower A to Dispensary B of 10 Lbs of flower and Dispensary B agrees to take 10 Lbs per month from Grower A for the next 12 months. Sales Rep John receives 5% commission on the initial sale of 10 Lbs and then receives 3% commission for the next 12 months of Dispensary B purchases.
Commission % Examples:
Lbs of flower – %
liters of distillate – %
edibles (ie. Adult use chocolate bars, etc) – %
I’d say it depends less on the percentage and more about the relationship you have with the grower/manufacturer, if you’re getting better deals on product because they value your service it sort of messes up any sort of straight percentage-based figure you’re coming up with. There are many variables involved.
Are you saying that the industry as a whole doesn’t have a set percentage, even within a few points, because it would all be merit based on your relationship with the grower and what your sales prowess entails?
I think you are probably correct to a point because I haven’t been able to find direct info on this especially for a state that is fairly new to this legislation. However, I would think that states that have been in this for a while like CA, or OR would have established some type of scale by now.
Pretty much what i’ve seen is that there are normal sales commissions for CBD sales which no doubt have tapered down even lower since the price tanked since you’re looking at percentage of potency vs. actually having to comb over the product to see if it’s up to snuff.
THC based products however it really depends on the broker, honestly. If the broker has the upscale market/dispos that’ll run your stuff for a higher price the grower then will fucking LOVE that guy and try to give that specific broker price breaks just to keep up the hell of a job he’s doing. A good broker is the golden goose a farm needs and there’s more and more popping up every single day so the thing they need to do is define themselves and EARN that extra chunk. I can tell you that would take a lot of stress out of any grower or manager’s day and you would be more than fairly compensated for making their product liquid quickly - but that’s what’s required. Being above and beyond. Knowing the product inside and out, knowing how the smoke is, etc. Essentially grower knowledge but working in sales, if you have that then your source won’t have the ‘Ugh… gotta meet up with the broker’ attitude and you will be treated more than well for it.
Less waiting for money is less budgeting they have to do so being THAT guy has it’s perks if you can fucking crush it. Everyone is trying to middleman someone else’s work so unless you bring something new and badass to the table…it’s tough out there.
This is not your normal industry. Not sure if you come from a straight sales background but I can tell you this - growers tend to support people who’ve been a part of the industry as long as they can. They appreciate the devotion. They don’t want someone to treat their baby they’ve been working on for months and months and months like a 9-5. They treat the people who treat them good like family. If you’re looking for this to be like a surface level sales job and not make actual bonds with the farms and growers don’t expect a good result, they want lifers and the people who have serious love and devotion for the craft.
Thank you for this. That all makes sense to me. My background is sales in the outdoor industry for the last 15 years, but I come from cannabis culture as a former grower, which I loved doing for the 7 years I did it. Now, with everything going medical and rec, I have friends – past and present – that are doing these large scale operations and they want me to be apart of it. I never left, I just detoured and I feel like it is all cyclical. So, I’m passionate about the industry, but as a sales guy with a family I also have to treat this like a business, which is why I was looking for some comps to get a better idea. Your response probably told me more than just a number would, so thank you for that. Like all sales – if you can make yourself indisposable, then you can write your ticket in a lot of situations. There are so many operations at the moment, it just seemed so strange to me that most of these outfits haven’t thought about the end game of bringing their product to market. Everybody just thinks it’s a gold rush and am I right to think that at least a quarter of these growers are in way over their head. It feels like the snowboard industry many moons ago when everybody had a snowboard company after the big boom, but when the dust settled, there was only a handful left. Thanks again for your responses.
All I can tell you is what I am familiar with in working with/through brokers in Colorado. The need to bring in an outside sales rep really means one thing… supply is out weighing demand… or at least as far as the producer bringing in the sales rep is concerned. What I saw happening is that the two different reps we brought in were both working more for the buyers than the sellers. After all if the seller finds the need to bring in a sales rep he is already clearly demonstrating he is at the lower end of a slanted field. The buyer on the other hand has the one thing necessary to ink the deal… CASH. Just make sure you check the areas normal pricing on the wholesale market to make sure you are not getting hosed. Also make sure and read the contract to see just how long you are obligated for commissions on return customers. Honoring that contract is important because it is a relatively small community and to be flagged as someone who will jump connections is looked at in the same manner as the old BM.
Edit: My bad, I thought you were looking to bring in an outside sales rep… not in becoming one. If you are closely (as in friends) associated with growers and treat them with the respect their product deserves, then you should CRUSH!
No problem, I was afraid I was coming off more as an asshole than actually getting my intended point across, glad I could help! You seem to be the type of dude that needs to be involved more with brokering then since you understand the margins that need to be made. I wish you luck, bro!
That is interesting because I suppose even if you are working for the grower, it’s a two way street and sourcing various strains, etc for the dispensaries will undoubtedly come up in deals. That helps because my initial plan was to represent multiple growers. A more diverse product offering would be key in that scenario.
So, did you say you brought reps in? If so, did you pay them salary, or only commission?
Also, at the moment in the Midwest there seems to be a shortage, but with the amount of new operations taking shape, that may teeter toward the other side. What are you seeing in MT for supply? MT rec legislation is only a few months old I think, so demand must still be high.