The shop is wildly popular, with a huge selection of brands, much-loved strains and a vibe that other dispensaries can only dream about. This isn’t the fruit of a step-by-step corporate guidebook about how to open a marijuana dispensary. Heart, business savvy, a strong aesthetic sensibility, location, luck — all of it contributed to the store’s smashing success.
But fresh competition blossoms every day. No worries? Always worries. Especially as smart retailers with deep pockets join the cannabis revolution and start hunting for space and opening stores.
A wise next step: developing in-store cannabis brands, everything from vape pens to gummies to a line of CBD-rich tinctures. Great store-branded cannabis products help further cement customer loyalty — they have nowhere but their favorite store to snag their most-treasured line of Rosin — raise store profiles and introduce welcome pricing variation into inventory. Plus, the profit margins on in-store brands is generally higher.
But while the dispensary owner clearly understands how to build a store and nurture a winning shopping experience, cannabis manufacturing is entirely different. It’s expensive equipment, like extraction technologies, industrial kitchen equipment and machines calibrated to deliver highly precise amounts of ingredients, like THC. It’s science. It’s packaging and distribution. It’s a blizzard of pricey licenses. And if the store envisions growing its own cannabis, it’s HVAC and irrigation, lighting technology and curing rooms. It’s agriculture.
Building Brand Awareness, Pricing Variability and Customer Loyalty
The smart answer to the branding dilemma, for many store owners and leadership teams, is finding partners for product development, companies that already understand how to transform cannabis into vape pens, different kinds of extracts like shatter and wax, cookies, pills, lotions and instant coffee. The turnkey cannabis options can simple and straightforward as co-branding — essentially, taking an existing product, like a vape, and branding the packaging with the store’s labels. But the product development options, too, can give stores complete control over much more than the label: developing bespoke formulas, recipes and flavor profiles, creating custom-shapes for cannabis products and much more.
And it’s not just for stores — edibles companies sometimes want to break into the world of vape pens, for example, and work with manufacturing partners. And vice-versa.
“If you already have a formulation for a product, great. We can reproduce it and handle the packaging and branding,” said Tracy Ogishi, director of product at Caliva. “And let’s say you want to make a specific kind of vape, one that promotes relaxation, but you don’t have a formulation, you don’t even have a product you are turning towards as a model. We have a process for ground-up product development, and we walk people through it at their pace. We can develop the formulation, in collaboration with the partner if desired. Provide prototypes. In the end, it’s their brand, their label, their product. It’s their vision — we just turn it all into products on shelves.”
With vape sales positively rocketing skyward in California — according to cannabis market research firm BDS Analytics, vape sales now capture 80 percent of the California marijuana concentrates market, which is far more formidable than in other states — Caliva places special emphasis on mastering vape manufacturing. From extraction to formulation using combinations of terpenes and cannabinoids like THC and CBD to branding the pens and shipping them, Caliva covers all of the bases.
“People are experimenting wildly with different strains,” said Nelson Ricardo, the product development supervisor at Caliva. “They love certain strains for their flavors, for how they make them feel. Our extraction program uses advanced technologies that lets us precisely recreate flavors and effects in our vape oils.”
He added: “Turning cannabis into high-quality oil is an art. But we work hard to add a deep layer of scientific rigor to all of this extraction art. If the strain is Girl Scout Cookies, we want every batch to taste exactly like true Girl Scout Cookies flower. And we want the constituent parts — the THC content, other cannabinoids and terpenes — to precisely reflect Girl Scout Cookies. With every batch.”
Cannabis Licenses Are Key for Cannabis Product Manufacturers
One of Caliva’s competitive advantages hinges on the San Jose company’s arsenal of licenses. The many facets of the cannabis industry involve a downright kaleidoscopic array of licenses, most of which are difficult to attain in terms of effort and time, and expensive. The majority of third-party product development teams only have a few licenses, which limits flexibility for partners who might want to create their own house-branded extracts after the success of the mints, or who would like the production partner to handle distribution. Even worse, some third-party manufacturing partners engage with product development without all of the required licenses.
Ogishi said Caliva’s end-to-end approach has taken years to develop, and was foundational to Caliva from the beginning.
“Early on, we understood that stores and other brands would need manufacturing partners,” Ogishi said. “A big part of the Caliva team comes from intensely competitive tech, where the best companies find marketplace needs and direct immense attention towards satisfying them. They anticipate problems before they even arise, and work to solve them. That describes the Caliva way, and we continue honing and strengthening this approach as the cannabis industry goes nuts.”