Getting a product to market safely is always top priority, but getting it to market quickly also has important benefits for consumers, manufacturers and retailers. A major issue facing successful cannabis retailers is that certain products see such a surge in popularity they quickly sell out. This results in lost revenues and, potentially, a damaged reputation for retailers. Improvements in manufacturing process and analytical testing play an important role in improving timing and ensuring quality.
While it might seem counterintuitive, increasing testing can actually help you get your product to market faster. Working closely with an external or internal lab during the development process is a key component in making sure both the manufacturer and testing lab understand the product better and can better interpret results. New and different matrices can be a challenge to analyze consistently so it is important to start that important work as soon as possible. Additionally, be sure to find a lab that works quickly, has robust quality processes, stringent employee training and strong communication skills throughout the development project. The development work ensures that the transition to compliance testing goes smoothly, and businesses do not have to worry about potential failures and formulation issues.
The knowledge and expertise of the cannabis industry can be leveraged to track market data and inform the timing of new product introductions. Most major cannabis companies publish quarterly updates on their businesses and the performance of their products. Additionally, cannabis specific data can be purchased, which tracks sales at the SKU level in many states in large part due to the work of third party research firms like BDSA and Headset across multiple states. This detailed information is extremely valuable for less mature cannabis markets where new businesses are deciding which products to launch and when.
Tracking changes in market trends and how competitors are behaving can help provide a peek into the future. This will help you focus your resources on products that are in demand versus those that might be a short-lived fad. Get out of the office and into dispensaries to talk to customers about what they are buying, what they are looking for, what they want as well as what they are not getting. Then use this insight to make sure you are focused on a product mix that is meeting those needs.
Work closely with everyone who can impact the product-to-market pipeline, including your manufacturing team, distributors, state government regulators and analytical testing labs. Building relationships with regulatory agencies will help you to understand their requirements better and make sure it is a product you can actually launch without any snags in the regulatory process. Working with your manufacturing team will help you make sure there’s capacity to produce new products. Finding 3rd party testing labs where you can establish a relationship with regular communication and fast turnaround times can help to ensure a faster path to market and a better understanding of the efficacy and safety of the product.
Have a plan to follow to get your cannabis product on store shelves. Your plan can be simple, but it should include an assessment of these major drivers:
In particular, packaging and hardware can be one of the most challenging aspects in a new product launch. Since most packaging and hardware comes from China the lead times can be long, at times approaching 3 to 4 months. Planning for those delays is one approach. Another approach that many cannabis businesses have successfully adopted is using domestic suppliers that can more quickly react to the changing needs of cannabis companies. If the launch is a success there is usually a possibility to negotiate for further volume discounts or transition to longer lead time, more cost-effective suppliers.
The cannabis industry moves very fast, and the biggest opportunities can happen quickly. Using market research, leveraging strong relationships and having a solid plan will help businesses be successful and meet their goals. Finding ways to shorten the new product launch cycle is critical for businesses to maintain their competitiveness and to ensure that consumers
Rob Radke is President of Method Testing Laboratories, a 3rd party cannabis and hemp testing lab based in Tampa, Florida. Rob is an experienced cannabis, operations and finance leader with deep experience leading manufacturing operations, commercializing new products, mergers, acquisitions, turnarounds and restructurings. Rob has completed over $6.0 billion in transactions from small real estate purchases to highly complex and large acquisitions. Prior to Method Testing Labs, Rob was a senior executive with Parallel Brands, the largest private cannabis company in the United States.
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