Cash is king (for now) in cannabis dispensaries
Dispensary payment processing might be one of the most challenging aspects of running a cannabis retail store. Cannabis dispensaries don’t have the same options available to them that other retail stores do.
Most state-legal marijuana dispensaries are unable to accept credit and debit card payments because the federal government considers cannabis a controlled substance. Tax code 280E prevents businesses involved with a controlled substance from utilizing traditional banking services, like payment processing. This makes the cannabis payment processing world quite complex. Tax code 280E also prevents cannabis businesses from claiming most business expenses and applying for traditional business loans.
Cannabis dispensaries do their best to make it easy on their customers by installing ATMs, but the fees can be frustrating for some people. Not to mention, waiting can be a hassle if there’s a line to withdraw cash. '
Don’t neglect the checkout experience in your marijuana dispensary
According to Fundera, 80% of customers prefer paying with their card over cash and only 10% of customers make all of their purchases with cash. According to 38% of credit card users, the inconvenience of carrying cash drives their decision to pay by card.
This puts cannabis dispensaries, who by law can’t accept credit or debit card payments, at a huge disadvantage in the retail space. That’s where contactless, cashless payment solutions for cannabis dispensaries become vital.
A 2018 study from Popspots confirmed what we all know: solid customer experiences are the driving force to retain customers.
But, you might not know that for 50% of consumers, checking out is the process that makes or breaks their retail experience. 70% of consumers say it’s one of the most important factors in shaping their perception of a retail store, according to the Popspots study.
"For brands and retailers alike, the in-store checkout offers one of the best opportunities to reach, engage and convert shoppers, driving both immediate impact and long-term loyalty. Despite its importance, for decades the opportunity has been largely untapped due to limited visibility and outdated tools," said Marlow Nickell, co-founder and CEO of Popspots. "Now, smart technology is closing that gap and redefining both the retail checkout and the future of digital out-of-home advertising, providing actionable insights to brands and stores that help grow brand equity and drive conversions in the moments that matter most."
Cannabis dispensaries must take their customer’s checkout experience into consideration when choosing payment processors and accepting money.
Utilizing contactless cannabis payment processing services
We’ve all heard just how many germs cash carries. A 2017 study looked at multiple $1 from a bank in New York City. Researchers found hundreds of species of different organisms on these $1 bills.
The most abundant organism on the cash? The acne-causing bacteria; along with plenty of harmless skin bacteria. But, microbes from the human mouth, DNA from pets, and other bacteria from other places we don’t need to name here... if you catch our drift!
One piece of currency could stay in circulation for five to 15 years in the United States. That’s plenty of opportunity for germs to make their home in your wallet. Physical U.S. currency is actually the perfect landing ground for different organisms, made with 75% cotton and 25% linen - the germs settle right in.
Now that we’ve all lived through 2020, germs are on our minds more than ever. There’s a common worry about cash transmitting the coronavirus. The more hands touching the cash = more opportunity for disease to spread.
But we forget about credit cards, pin pads, ATMs, and other shared POS devices. Studies show cash actually has a lower risk of transmitting COVID-19 than debit cards and pin pads, as the banks have been quarantining and sterilizing cash upon arrival. COVID-19 can survive 72 hours on plastic, which most debit cards and pin pads are, according to the study.
If you’re a dispensary operator, your cannabis dispensary is likely taking the proper steps to prevent spreading COVID-19. Your staff is likely masked, hand sanitizer is abundant, cleaning schedules are strict, and you may even check your staff’s temperature when they get to work.
Despite these precautions, it’s impossible to eliminate every single germ in your marijuana dispensary - especially on your pin pads. That’s why it’s crucial to go beyond cashless payments and incorporate contactless payment processing.
AeroPay’s contactless payment processing has increased our client’s average transaction size by 40%. It’s less work for you and less work for the customer. All your customers need to do is scan a QR code with their mobile device and log in to their account. Other payment processing solutions require sensitive information like your social security number or birthday, but with AeroPay, your customers just sign into their personal online banking account.
From there, the customer will confirm their payment and have the option to leave a tip. Unlike the ATM, there are absolutely no fees for customers who use AeroPay.
Payment processing solutions organize your dispensary’s numbers
Maintaining accurate records of accounting is the most important thing a cannabis dispensary can do.
We know, that’s a bold statement. Cannabis dispensaries claim virtually zero business expenses aside from the Cost of Goods Sold (COGS), thanks to tax code 280E. The invoice price of cannabis, for example, is considered a COGS. The shelves in your dispensary are not. Without detailed records, you can’t prove your numbers and claim the most business expenses possible.
On top of that, cannabis dispensaries operating in cash only run the risk of inaccurate reporting. Transferring cash to digital data can be a hassle and creates ample room for error.
AeroPay allows you to keep track of all payments at your marijuana dispensary and display them in one, organized online dashboard. You’re able to view daily totals, track transaction sizes, and analyze customer payment history. That way, you have access to your marijuana dispensary’s payment history at any time and avoid the cash drawer scramble.
AeroPay is the easiest contactless payment processing solution for marijuana dispensaries and their customers. We offer a safe, secure, and cashless way for dispensary patrons to pay. Studies show the checkout experience plays a significant part in 70% of consumer’s overall retail experience. Eliminating the hassle of withdrawing money, waiting in line, and using unsanitary ATMs and pin pads enhances the checkout process.
As a dispensary operator, AeroPay eliminates cash management and accurately tracks all payments in one place.
Request an AeroPay demo for your marijuana dispensary here.
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