6 Tips For Effective Dispensary Referral Programs

Cannabis Industry Employee Referral Programs

Employee referral programs can be an effective way to hire talented people in the cannabis industry, and they can also be invaluable in the current talent acquisition environment, in which open jobs outnumber qualified candidates.

How many of you have a close-knit group of friends that you think are the bomb? We all believe that the people we know and the people we surround ourselves with are the greatest people, and we should leverage that.

Here are six (6) guidelines for crafting effective employee referral programs:


1. Give Employees What They Need To Refer

Using employees to promote your cannabis industry brand can be helpful when done right. The first step is acknowledging that, if you want to build a referral program that really works, you need to have a referral-worthy culture.

Treat every employee as a brand ambassador and provides all employees with the information and tools they need to fill that role. Ask all new hires to provide us with a list of 10 names from their personal network.

When the company has open positions, hiring dispensary managers need to review these contacts. If there’s a potential match, dispensary managers ask the referring employee to introduce the potential applicant to both the company and the employment opportunity.


2. Set Clear Guidelines And Expectations

Make sure employees in your cannabis dispensary understand the referral program’s guidelines and expectations, including who is eligible to participate in the program and receive rewards for referrals. According to HCI Research, of the companies it surveyed:

  • 78 percent provide the same reward for a referral whether the open position is executive-level or entry-level.
  • 60 percent allow all company employees to participate in the referral program.
  • 58 percent give preference to candidates who are referred by current employees.
  • 55 percent accept referrals from nonemployees, such as customers or clients.


3. Offer Incentives That Motivate

HCI Research indicates that 74 percent of employers offer referral incentives. Of those, 92 percent offer cash, with a median award of $1,000. Awards of $500 are the most common.

Consider the timing of the reward as well. Most employers hinge payment on a referred hire’s staying employed with the company for a set period of time. Only 27 percent of employers offer a full reward immediately upon a referral’s hire.

Aim for parity in these rewards so that a referral for an executive job doesn’t pay substantially more than a referral for a lower-level job. You don’t want the perception that one job is more important than another, so your cannabis business needs to revise the dollar-amount of its incentive payouts for referrals to help achieve parity between departments.


4. Market The Program

It is recommended that you treat the employee referral program in the cannabis industry as an ongoing marketing campaign. Investing in marketing and communication plans for the program can increase the likelihood that employees will participate.

A unique marketing approach for its employee referral program: Referred candidates get a coveted green Adidas track-style jacket after working for one year at your cannabis industry company. The jackets remind everyone that employee referrals have an impact.


5. Hold Leaders And HR Accountable

One common complaint about referral programs is that Human Resources in the cannabis industry sometimes fails to communicate with the referring employee and the candidate about the job status. To avoid frustration, share information with both parties, and keep them updated about the hiring process.

Consider responding to every candidate referral within a set time, such as 10 days. Senior leaders need to believe in the program and be a part of the design. To get this buy-in and find a program champion, give leaders data and feedback on the program’s outcomes.

Make sure executives understand the current competition for talent and the need to capitalize on employee networks. The stakes are so high, and there is not enough talent to go around. How do we get these people in our door and properly trained for the cannabis industry?


6. Provide Feedback On Outcomes

Measure that your cannabis industry referral program is working or not working, and make adjustments as needed, common metrics to capture include:

  • The number of employees hired through referrals, compared to other methods.
  • The number of qualified candidates obtained through referrals, compared to other sources.
  • The rate of employee participation.
  • The retention of referred hires, compared to other sources.
  • The performance of referred hires, compared to other sources.

Let us know what you think.