Holidays are a busy time of year for businesses in all industries, including cannabis. While nationwide sales have increased drastically overall with more states legalizing cannabis use, there are certain times of year in which demand spikes. For example, 4/20 is the industry’s biggest holiday. Compared to average sales, 4/20 represented a 75% increase in sales in 2021.
Fall and winter holidays are also significant, with 46% of the cannabis industry’s top ten sales days falling between Thanksgiving and New Year’s. New Year’s Eve 2020 alone saw a record $89.4 million in sales.
Being able to meet increased demand during holidays is crucial. However, not all cannabis businesses may have the funds on hand to achieve that goal. Cannabis financing can help keep you on top of your holiday game.
The Benefits of Additional Cannabis Financing
Additional cannabis financing to weather a holiday rush can provide several significant benefits:
- Increase your inventory. You can have the products on your shelves to provide customers with what they want. Manufacturers can also ensure they have plenty of finished products for their dispensary customers.
- Boost your marketing efforts. Extra money can help you launch a holiday-specific marketing campaign.
- Hire extra help or pay overtime. When things are busier than usual, you might need to hire seasonal staff or pay your existing employees some overtime. The additional financing allows you to ensure that you have the people you need on deck without worrying about how you’ll pay them.
- Fulfill purchase orders. You can get the extra capital you need to cover any purchase orders you might receive for a holiday rush.
Get Extra Funds with Purchase Money Financing
A lot of cannabis companies receive purchase orders during holidays. The problem is that they don’t often have the capital they need on hand to fulfill them during times of increased demand.
Rather than turn away requests for purchase orders, you can get the funds you need with purchase money financing. Here’s a quick look at how it works:
Apply for Purchase Money Financing
Let’s say you’re a manufacturer who received a purchase order from a dispensary for finished products, so you need to submit a purchase order for raw materials from a cultivator. You don’t have the capital on hand to do so, though. So, you apply for purchase money financing.
Pay for Your Materials
Upon approval, your lender pays the cultivator directly and you get what you need to fulfill your purchase order from the dispensary.
Fulfill Your Purchase Order
After receiving their delivery, the dispensary pays your lender directly. Your lender keeps the amount they advanced to the cultivator plus all accrued fees. You receive the remaining balance.
Purchase money financing isn’t only for manufacturers, though. It can also benefit:
- Cultivators
- Retailers
- Distributors
- Cannabis brands
- Ancillary cannabis companies
With purchase money financing, you can substantially increase your purchasing power. You’re able to pay COD, which can get you discounted pricing, too. Most importantly, you can get what you need to meet the increased demands of the holidays.
First Steps
Bespoke Financial makes purchase money financing (and other cannabis financing options) easy. We pay your vendors directly, allowing you to get what you need to fulfill your purchase orders.
If you’ve decided purchase money financing is right for you, your first step is to apply. In addition to providing some information about your company, you’ll also need to supply your financial background, including current debts, profitability, and information from your balance sheets. Upon approval, you’re ready to start fulfilling your holiday purchase orders.
Get the Extra Cannabis Financing You Need During the Holiday Season (and Beyond!)
Are you looking for purchase money financing for your cannabis business? Bespoke Financial is here to help. Visit us to learn more and fill out your application online.
