Cannabis Culture & Leadership: Uncovering the Cannabis Industry’s High Turnover Rates with Christine Hodgdon

Are you interested in the world of cannabis and wondering what it takes to thrive in this rapidly evolving industry? In this week's episode of Proud to Work in Cannabis, host Karson Humiston, CEO & Founder of Vangst, dives deep into the cannabis industry with a special guest, Christine Hodgdon, COO of Highway Cannabis and a former VP of People at Native Roots, as well as a former COO of Vangst. Join us on this enlightening journey as we explore Christine's incredible career path and gain insights into the thriving cannabis sector.

Christine’s Entry into Cannabis

Christine's journey into the cannabis industry began when Jenna Myers from Vangst reached out to her in 2017 while she was living in Colorado. Initially, Christine had reservations about the industry, but a meeting with Jenna dispelled her misconceptions. She was impressed with the professionalism and organization she found in the cannabis world.

After several conversations with Native Roots, Christine decided to take the leap into cannabis. When she joined Native Roots, she was the most prominent candidate Vangst had placed in terms of title and salary. The celebration of her signing the offer letter marked a significant milestone for Team Vangst. Christine's unique background in people operations and her passion for the cannabis industry led her to focus on attracting and retaining talent. She recognized that attrition rates in the industry were high, with a shocking 70% turnover rate.

Why Turnover Is So High in Cannabis

Christine attributed the high turnover rate in cannabis to a couple of key factors. Firstly, some individuals enter the industry for the wrong reasons, viewing it as an attractive and glamorous field without fully understanding the hard work required. Secondly, unrealistic career expectations led some to leave when rapid promotions and opportunities didn't materialize immediately.

Christine and Karson emphasized that while career growth in cannabis can be swift, it still demands hard work and dedication, much like any other industry.

Christine’s Takeaways from Her Time at Native Roots

At Native Roots, Christine played a pivotal role in implementing an extensive onboarding program. This program aimed to address the high turnover issue and ensure customers could build lasting relationships with budtenders.

Additionally, the Native Roots team focused on understanding customers' preferences in terms of products and experiences, contributing to their success.

Christine’s Time with Vangst

Christine's transition from Native Roots to Vangst was marked by her move from a well-established company with established processes to a growing startup. She described the experience as navigating a "growing shit show," where she and her team focused on addressing immediate challenges.

During her time as COO, Vangst experienced remarkable growth, going from $4 million to $9.5 million in under 12 months. However, this growth was interrupted by the unexpected challenges of the COVID-19 pandemic.

Navigating the Pandemic as a Cannabis COO

Christine highlighted the unprecedented nature of the challenges posed by the COVID-19 pandemic. Vangst had just built a robust team of Vangst GIG cultivation workers before the pandemic hit.

Unfortunately, the pandemic rendered these workers unnecessary, requiring a swift adjustment to survive. Both Christine and Karson emphasized the difficulties they faced during this time, describing it as "horrifying." However, Christine's calm and strategic leadership played a crucial role in helping Vangst weather the storm.

From Vangst to Highway Cannabis

Christine became employee #2 at Highway Cannabis, working closely with the founder, Chris Colón. Together, they focused on operating efficiently and providing exceptional customer service.

Highway Cannabis aimed to become the preferred cannabis brand in its community. Christine acknowledged that this goal was more achievable in some areas than others. Despite challenges, the pandemic brought substantial revenue increases to retailers.

Christine emphasized the importance of managing cash flow, inventory, labor costs, and controllable expenses to navigate California's competitive cannabis market successfully.

Negotiating Brand Terms

Highway Cannabis established strong relationships with top vendors by consistently paying on time. Christine discussed how they negotiated terms with brands, often aiming for net-30 terms to align with their 21-day inventory turns.

While not all brands offer these terms, Christine noted that the situation has improved over the years. She emphasized the significance of reliable payment to establish a positive industry reputation.

The Current State of California Cannabis

Christine provided an overview of the current cannabis market in California, which is highly competitive with approximately 12,000 licenses allocated to cannabis businesses. California generates about $4 million in monthly revenue from the regulated cannabis industry.

Christine and Karson delved into the issue of the thriving illicit market in California, discussing the price disparity due to taxes in the legal market.

How Rescheduling & the Removal of 280E Would Impact Highway Cannabis

While the impact of cannabis rescheduling to Schedule III remains uncertain, Christine emphasized the significance of the removal of 280E for all retailers. Currently, cannabis businesses cannot deduct ordinary business expenses, which puts immense financial strain on the industry.

Christine expressed excitement about the potential for explosive growth if 280E is removed. She believed this change could infuse much-needed capital into the industry and lead to a resurgence in investment.

What Advice Christine Would Give Herself at the Beginning of Her Journey in Cannabis

Christine advised against falling victim to "shiny object syndrome" in the cannabis industry, where entrepreneurs become distracted by new, exciting opportunities and overlook their core business. She stressed the importance of listening to customers, focusing on high-performing product categories, and protecting the core of your business.

Fostering a Positive Culture Within a Business

Christine shared her approach to fostering a positive culture within her businesses, emphasizing the value of hands-on experience. She frequently works on the retail floor as a budtender to connect with customers, gain direct feedback, and understand the challenges faced by her team.

Clear communication, transparency, and accountability have contributed to a 0% turnover rate on her leadership team. Christine believes in giving her team autonomy while maintaining a strong sense of accountability. She also emphasized the importance of showing care for employees as individuals, not just as members of the team.

Proud to Work in Cannabis

Overall, the cannabis industry is evolving rapidly, and it takes dedicated individuals like Christine Hodgdon to drive positive change and success within it. If you're eager to learn more about her journey and gain valuable insights into the cannabis sector, don't miss this week's episode of Proud to Work in Cannabis. Join us in celebrating the incredible professionals shaping the future of the cannabis industry.