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Top cannabis delivery business model that generates revenue

By Aurobind Singh 29th October 2021

Cannabis has been there for a long time, but its consumption has been hyped in recent times. After it was made legal for medicinal and recreational purposes in various countries, the use of marijuana has increased manifolds. Many businesses have achieved a high ( pun intended ) by starting cannabis delivery in their respective regions. Starting a weed delivery business is not easy, but having a business plan can be very cost-effective. In this blog, we’ll discuss the top cannabis delivery business model that generates revenue.

On a comprehensive spectrum, there are different business models you can choose from:

  1. Direct to consumer model 
  2. Single storefront model
  3. Multi-Merchant model

Direct to consumer model or the hub and spoke model

direct to customer

In congested cities like New York, it is challenging to deliver products in time. Using the hub and spoke model, direct-to-consumer brands open up small branches or franchisees, or fulfillment centers in different cities. This is done so that they cover a broad geographical area and cater to larger demography of consumers. This not only uses the fuel consumption by the drivers and also reduces the delivery time. 

To get an idea of how this can be implemented, check out this 15 min delivery blog for grocery; you can implement something similar to achieve a faster delivery time for your cannabis delivery business.

Though this delivery model has an upside of increased sales with reduced delivery time and costs, it has its challenges. One of the challenges is managing the orders for different branches and mapping them correctly.

To solve this problem, you need an intelligent software solution like Yelo’s cannabis module. Using Yelo’s direct-to-customer section for your business, you can create different branches and allocate separate geographical areas which they will serve. It also gives you the ability to manage inventories of all the fulfillment centers or branches separately while mapping the order from your customers to the nearest hub that serves their geographical area automatically.  

Single-storefront cannabis delivery business model

single storefront

This model works best for cannabis dispensaries that want to increase sales by going online and adding a delivery module to their existing business. Since they already have well-scaled demography and a better understanding of the customer needs and desires. Taking the store online using cannabis dispensary software and adding a delivery module can help them scale their sales exponentially. In this module, the entrepreneur can either use freelance or third-party delivery services or have their in-house delivery team depending on their capacities.

Yelo’s cannabis dispensary module helps you take your existing cannabis dispensary online by enabling your customers to order from you using a website and/or mobile applications depending on the plan you choose. It also allows you to keep track of your delivery agents using an innovative delivery management system powered by Tookan.


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Multi-merchant cannabis delivery business model


Multi-merchant or aggregator-based cannabis delivery business model is becoming very popular among entrepreneurs these days. This model is a tried and tested model that promises excellent revenue. This model does not require you to have your inventory. Instead, you create a network of local dispensaries who have their inventory and manage orders and deliveries for them. In return for providing orders to the local dispensaries, you take some commission from the dispensary and charge a small delivery fee from the customers for fulfilling their demands.

Yelo’s cannabis delivery marketplace suite enables entrepreneurs to add multiple cannabis dispensaries to their platform. In contrast, enabling dispensaries with their pannels and app to manage their catalog, inventory, and discounts independently. It also gives the ability to entrepreneurs to receive/settle commissions from cannabis dispensaries in real-time using the stripe split-payment method and intelligent delivery management powered by Tookan.

Check out this blog to learn more on how to start an online cannabis delivery business in 2021.

Many countries are legalizing the medicinal and recreational use of cannabis ( check out the status of cannabis legalization in your country here ). That being said it is a fairly new industry with high growth potential and less competition making it a perfect growth opportunity for budding entrepreneurs and established dispensaries. If you’d like to get started with your own cannabis business or you want to take your existing cannabis business online connect with us today and we shall help you achieve your goals.

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