Find out how Fobi is helping America's largest CBD retailer support franchisee success & optimize its supply chain.
The following is a transcript of the conversation between Fobi Marketing Director Devon Seidel and Your CBD Store President Jay Benge.
Your CBD Store President Jay Benge: One other piece that I'm super excited about right now, that your team has really kind of started to give us some insight into, is our customer demographic. It helps you with targeted marketing. It helps you with loyalty. It really connects all the dots.
Fobi Marketing Director Devon Seidel: Can you speak more specifically as to how our platform helps you manage hundreds of individual franchisees?
Jay: I think really what the platform has done for us is it's giving us insight into our brand and how consistent the brand is across the large population of store owners. When you talk about coast to coast and having to manage that.
Where I really think the powerful piece to the tool will be in our system to our owners specifically, is the individuals who hold the multiple stores. When you've got 10 stores, it's a lot different than owning one store because you can go to one store and you can watch and see how things are going. When you've got 10 stores, you've got to watch from afar and the platform definitely helps with that.
Devon: Hey, you're listening to the Loop Experience Podcast. Join us for exclusive interviews, behind the scenes updates, and all things Loop. Coming at you from the head office storage room, I'm your host, Dev.
Welcome back to the podcast. I'd like to introduce our guest today, who's Jay Benge. He is the President of Your CBD Store, the largest hemp retailer franchise in the United States and exclusive home of the award-winning hemp-derived SunMed products. The company currently has more than 550 stores across 41 states, as well as four stores in the United Kingdom. Your CBD Store provides the highest-quality CBD experience to customers nationwide. It's parent company Sunflora Inc. produces top quality products for health, wellness, skincare, and pets. So welcome to the show, Jay.
Jay: Hey, thank you for having me. Glad to be here.
Devon: And CBD and cannabis business... We're kind of a fixture business in news headlines around 2017 to 2019. And specifically in the States, it's still staggering. There's a plethora of brands and retailers in this space, many of which are pure e-commerce plays. And I think that's a big piece of what you're doing. And then Jay, you also have your retail locations as well, too, right?
Jay: Yeah, that's correct. I think actually our retail locations are probably a bigger part than our e-commerce site. Even when we talk about e-commerce, everything on our site is geared toward directing people to the store.
Devon: That's great. And I know you have a great business background before you came into Your CBD Store. Do you want to touch on a few pieces of that and give our listeners a little bit of information about your background?
Jay: Well, I think without giving my age away too much, I've been in the franchise business for well over 20 years. My most recent company prior to Sunflora and Your CBD Store and SunMed was Jackson Hewitt Tax Services. I was with them for 12 years.
For a good chunk of that 12 years, I ran the western half of the United States for them. So I actually was responsible for roughly 3000 locations at one point in time. And then I moved into a more supportive role my last three years with them on a fulfillment basis, and opening new stores, and really supporting our franchisees in a much more physical way from a storefront standpoint. But then I was helping over 6,000 locations. So I've got quite a few accolades as it pertains to that, but I've been doing this a long time.
Devon: And then why the switch over to CBD?
Jay: Well, like you mentioned earlier, it's the newest, latest, greatest sector and it's got probably the largest amount of potential over the next, I'd say five to 10 years and even beyond that. But it really, for me, I think a lot of our owners and even our founders, I found CBD to help me live a better life, feel better about myself and that just really kind of led me here. I found out I wanted to be in the industry. So I started to look and started to prepare myself, and just so happens that Your CBD Store, SunMed, Sunflora found me and I found them and we've had a great relationship ever since.
Devon: That's great. Why don't you tell me a little bit more about the Your CBD Store story?
Jay: The story, it really started with our founder Rachel. As we say, it started with one woman, one story, and one store. She found CBD much, like a lot of our stoners did, to help them live a better life, as well as her herself. And she decided, "Hey, if this is helping me this much, there's got to be a need and a desire out there in the market."
So she opened her first store in Bradenton, Florida, and people started to come into the store. Friends, family, business associates saw what they were doing, loved the concept and idea, and it kind of really took off from there. Really, it took two years for us to surpass the 500 store count number. I can't tell you... I've never been a part of a business that's grown that fast.
I've been a part of businesses that have grown fast, but 500 stores in two years is pretty incredible. We're continuing to grow that number through our franchising model, which we started earlier this year... or, I'm sorry, earlier 2020. I sometimes forget we've rolled over already into 2021. But really March of 2020 was when we started our franchising model. We're coming up on a year at this point with that here in the next couple of days. And it's just been incredible growth and momentum. We're up to about 200 franchise locations in just a little over a year.
So I think the product, the concept, is alive and well, and it's going to continue to grow as we come out of our pandemic scenarios and situations that we're in now. And we're expecting some rapid growth, not only in the US, but internationally. We see companies like the UK, or countries like the UK and the EU, starting to adopt their legislation that's going to allow us to play in those markets. We currently have four stores in the UK already. So we're not just a national company, we're an international company at this stage.
Devon: And was a franchise model always something that Your CBD was looking to move towards?
Jay: I would say in the beginning, no. I honestly think if you were to touch base or talk to our founders, they would have never thought that it would have grown to the size that it grew to in such short order. It almost happened out of necessity, just because of the number of stores and the interests in the stores. We felt as though you needed some structure around that, which you get from becoming a franchisor. You get brand protection. You get all sorts of things that come along with being a franchisor that you don't have in just a normal affiliate or licensing model, like they had had up until March of last year.
Devon: And with being a franchisor, and then having so many different franchisees across different states and jurisdictions, are there some challenges there that you recognize with keeping everything consistent for the brand image of Your CBD?
Jay: Yeah. I don't know that the challenges are unique to this business. I think the challenges exist no matter which franchisee or franchise you go after, or you're a part of, because states have their own rules and regulations. You have to also comply with federal regulations for our industry.
Devon: Okay. And specifically the Loop system or the Loop solution that we're providing to you, where are those initial benefits that you saw first when you were being introduced to the Loop service?
Jay: I've got a... It's interesting how it came about, and I'm happy that it did, because we were with our local POS provider, and I started coming from the industry I came from. We were a very heavily metric-driven industry, data-driven industry. So I started looking for some of the same things from our current POS carrier. They didn't have a very robust back-end from a corporation standpoint. Their reporting was great for the local store owner, but somebody at my level, looking for specific metrics that are going to help drive decisions, wasn't really available to the level I needed it to.
So we found Loop Insights, and I got to tell you everything that was presented to me was... I said, "Oh my gosh, this is exactly what I'm looking for." It's taken some time to digest the information that we've already gotten, or we're continuing to get, but it was really exciting when Luke came to the table after my initial questions and it's been nothing but a great relationship so far.
Devon: Yeah. That's great. And for our listeners, our partnership with Your CBD is through our POS integration with Vend. So the POS portals that Jay's company, Your CBD, is working with is Vend POS systems. So it's great to see that what you were recognizing, Vend was offering. And then when you were able to partner with us too, to really bring those insights and fill those gaps, like you were saying. What were the biggest gaps that you realized that were available through Vend, and what were the big pieces that Loop was able to add on top of that?
Jay: Yeah, I think prior to adding the Loop backend and reporting, we only had data from a sales perspective, meaning that when our stores called us up, we knew exactly what they were ordering and how much. What we didn't know is what they were selling. So, it sounds a little strange, being in the retail business, but we had no visibility or insight into what was actually selling to the consumer.
So that was, for me, the big one right out of the gate, is we, all of a sudden, had this information available that showed us that our consumers were buying a specific product. And we were able to then take that information and match it up to what we were selling on the wholesale side and see really what the differences were and how they compare. And surprisingly enough, we were able just... Those two components, or those two metrics, we were able to gather a lot of information.
We've been able to fine tune our ordering and manufacturing process. We're continuing to fine tune that, but straight out of the gate, it gave us some better optics into what we needed to order, what was maybe a little bit more critical than we had initially thought. So I think that was, to me, the game changer straight out of the gate.
Devon: That's great. And I think it's important to note, too, that just a lot of people from the consumer level think, "Oh yeah, the POS company that the store I'm shopping at probably knows everything about me. They're able to give that detailed insight about my buying trends. They probably have all the data in the world." But that's really not always the case. There's great tools out there that are able to provide retail insights through the POS. But, like you said, when you're now looking at something such as a franchise model, there really isn't that key player that's able to connect all the solutions in every system that you're using.
Jay: Yeah. I agree with you a hundred percent. I think we just started conversations with the Loop team to now integrate to our CRM platform. So we're looking to start to integrate with Salesforce, which is our CRM platform, but that's going to... I'm really looking forward and excited to get that integration done, or that piece done, because I think we'll be able to gather even more information in a streamlined manner and make better decisions from a data standpoint.
Devon: Yeah. A hundred percent. And I think you're right there. The real-time transaction piece, being able to tie that right into delivering personalized offers, promotions, and loyalty for your customers is a great piece there. It's actually activating those real-time insights, because I think a lot of the time we look at if a company can have real-time insights, that's great, but are they actually able to take that information and do something to provide something back to the customer in real time? That's kind of the key piece that a lot of companies are missing.
Jay: Yeah. Well, and I would agree with you there. I think some of the components we got early on, or some of the things we were able to do early on from the data, is we've been doing some fairly robust marketing campaigns across the nation. And we really weren't able to get any definitive ROIs on the information. And when we deployed the Loop Insight platform, all of a sudden these are ROIs came into our discussions and into our data-driven decisions. And we were able to change some things around and learn that certain things were working more effectively regionally, then nationally. And we're just continuing to use that information to make similar decisions.
Devon: And before the Loop system, what were you looking at from a data point? Was it like a weekly report that you're able to pull from all your franchisees? Or was it a longer timeframe? Did it take a lot of looking at different Excels and compacting information together?
Jay: Yeah. As I mentioned earlier, we didn't have a whole lot of data that we were able to collect. All we were really able to rely on was what came out of our shipping system and what we were shipping to our stores. And to be honest with you, we could pull that data daily and weekly, but inevitably we were always looking at it 30 days removed. It wasn't something that we were able to look at, just pull up a screen and say, "Oh, this is where we're at today." It was kind of an afterthought almost.
Devon: And with those insights being pulled into more real time, what are the use cases that you're looking to be able to do with that information?
Jay: Well, I think, one of the biggest ones, and I did mention a little bit earlier, has to do with ordering and manufacturing of our products. Just came out of a meeting earlier today, where we were looking at some of the data to determine what this new product run is going to look like, and what our initial order should be based upon transactions and what we saw from some previous new product launches. So I think that was great there.
One other piece that I'm super excited about right now, that your team has really started to give us some insight into, is our customer demographic. A lot of times you forget about that. And what does your perfect customer look like? Not that there is ever a perfect customer, but you can really define and identify that customer. And it helps you not only with manufacturing and ordering, it helps you with targeted marketing. It helps you with loyalty. It really connects all the dots. And we're really starting to be able to dig into that.
We started to plot information on a sales map to determine where these clients... where we can find these clients. So really going to start to give us some more targeted information that I'm excited to see, and that'll help us in 2021. Get more traction from the franchise side, but also sell more products to the people who need it.
Devon: That's great to hear. And with this COVID world that we're in, is there any way that you're using these insights to better understand how to reach your customers during this pandemic?
Jay: Yeah. I think it ties into everything we've already been talking about today. Just the ability to start to identify who the customer is, where they live, where they are, what that demographic looks like, being able to capture the ROI on marketing campaigns that we do, all help us fine tune what we're delivering to our store owners, our franchisees, as well as our consumers.
And it's really helped us survive the COVID pandemic at this point. We've had very little fallout from a store standpoint and our customers continue to come in. But I've got to give some credit to the data we've been able to capture on the Loop Insights platform, and help us refine and spend our money better and really tightened our belts when we've needed to and make those expenditures effective.
Devon: You mentioned how Loop's solution provided more relevant insights for what you needed at the franchisor level than what Vend was delivering. I want to circle back on what that means at an operational level. Can you speak more specifically as to how our platform helps you manage hundreds of individual franchisees?
Jay: Yeah. I appreciate the question. I think, as it ties into everything else we've talked about, we try to make data-driven and metric-driven decisions. But I think really what the platform has done for us, as almost a secondary component to all the metrics we've talked about thus far, is it's giving us insight into our brand and how consistent the brand is across a large population of store owners, as well as a large geographic expanse when you talk about coast to coast and having to manage that.
So, without actually physically going to a store, we can pull up a store and look into their product SKU database, find out what's selling well for them, find out whether or not they're selling new or old products. So it really helps us keep the store fresh, exciting, up on the latest trends. And I think it really also helps us when we might identify a struggling owner. We can go in remotely, we can look at that particular store, and without actually physically getting on an airplane in the COVID world we live in today, we can make some fairly profound insights into how the store is doing and what we can do to help them if they're struggling in any way.
Devon: That's actually a super interesting piece that you touched on there. Actually able to help your franchisees as a brand owner. Is there some more insight that you have around that? Maybe store merchandising that you're able to focus on with these insights?
Jay: Yeah. You know, I think it's interesting you mentioned merchandising because being a brand, or wanting to deploy a concept and a brand idea, we have a set way that we like to see our store set up. There's a flow and a method to our madness, is the way it's put oftentimes. And, when you do see a struggling store and you look at their product SKUs and what they're selling, we expect to see certain percentages from a sales perspective. And if we see those percentages out of skew, usually the first indication is they're not doing the script or the product's not placed correctly. Because if you do the script and the product's placed correctly, we have a pretty good idea of what the sales should look like at the end. So, it does help us from that respect with not only struggling stores, but all of our stores.
Devon: And what has been the franchisee's reception into using this Loop platform? I know we've made it as seamless as possible for them to onboard and provide those insights back to them. Has it been a positive because of all the benefits that they get from the direct connection with you?
Jay: Yeah, I've got to give it to your team. You guys did a really great job integrating it. It was very easy and non-disruptive to our store owners. I think during the integration of the initial a 100, 150 stores, I only had one store that will call me and go, "What's this Loop Insights thing?" So, I think you guys did a great job integrating and getting it into our stores without disruption. But I think we've got a batch of store owners that are just starting to learn how to use it, and what it could mean for them.
Where I really think the powerful piece to the tool will be in our system, to our owners specifically, is the individuals who open multiple stores. When you've got 10 stores, it's a lot different than owning one store, because you can go to one store and you can watch and see how things are going. When you've got 10 stores, you've got to watch from afar, and the platform definitely helps with that.
Devon: And I hope that it provides an advantage to potential franchisees deciding to go with Your CBD as a store to open up, because they get all these great insights, this great communication from head office down to the insights and all the information that you can provide. So, when they're searching for either opening up a store on their own privately, or looking at Your CBD, I hope that this provides a competitive advantage.
Jay: Yeah, I think it will. I think we're still kind of in the early stages. And every couple of weeks you guys throw something new at us, which is great, I love that. But I do think when you start to get into the more sophisticated franchisee, even your sophisticated business owner, it doesn't necessarily have to be a franchisee, they're looking for those metrics. Just like when I first came on board to this company, I was looking for the metrics and work where I could find them. So I think the fact that we've now got the tool in place, and it's easy to use, it's insightful, it'll just go a long way in helping get those business owners convinced that we're the right franchise for them.
Devon: Thanks for that in-depth look into how Loop's solution is being implemented in your business, Jay. At Loop, we've been growing so quickly and in so many different verticals, I feel like it's really valuable for investors and watchers of the company to learn more about the retail insights solutions that we've developed our technology around from the beginning.
So that covers most of my questions for today, Jay, I've just got one more thing I'd like to ask you. We've been asking most of our guests on the podcast this. But, with COVID, what is one thing that you've really been able to learn? And this doesn't have to be something specifically around your business, but maybe it's a hobby or something else you've picked up, or a skill you've learned. So I'd like to ask you what was one thing that you were able to learn from this pandemic?
Jay: You know, the one thing that I've really gotten out of this pandemic, and shame on me for not recognize it earlier in my life, but how important family and friends are. Having a support network of people you can pick up and get on the phone, or just talk you off the ledge sometimes is, I think, more important than what a lot of people give it credit for. And really, that's probably one of the biggest things I've pulled out of this pandemic is, know that family and friends are there, they're there to help you, and they're just a phone call away.
And for me, it's had a profound change in the person I am. I'm a happier person. I enjoy what I do. You wake up in the morning, and you want to go to work, and you want to see your friends, and you want to make the phone calls, and you want to connect with people in your business network. It just makes the whole difference about wanting to do that as opposed to having to do that. And that's really, I think, a couple of things, actually, that changed for me in the pandemic.
Devon: That's great to hear. Well, thank you for taking time out of your busy schedule with us, Jay. We're super excited with what Loop and Your CBD Store are doing currently, and all of the amazing things that were potentially going to roll out in the future with your company, to specifically your team, and your franchisees as well.
Jay: I appreciate the time again, and I hope everyone's doing well, and we'll talk soon I'm sure.
Devon: Awesome. Thank you so much. And thank you to our listeners for joining. And again, we'll see you again next week.
Click here for all episodes of the official podcast of Fobi: ‘Fobi Insider' (Previously Loop Experience).