To remain competitive in today’s rapidly maturing cannabis industry, I found a need to hire consultants and consulting firms who can strengthen and grow cannabis businesses like mine (Colorado Harvest Company).
Finding the right “fit” between consultant and client within the progressive culture of legal cannabis is the essential first step. Next, and equally important, is to establish clear communication processes and set expectations within a contract. Stay on top of consultants, and plan to measure results on an ongoing basis.
These straightforward tips can be readily applied to consultants in fields such as compliance, branding, marketing, public relations, legal affairs, business strategy, IT, operations and security.
1. Hiring and Contracting.
The industry is mature enough that all consultants should have substantial experience working with cannabis businesses. At this time, there is no excuse for a consultant to request fees to get to know the cannabis business and its place in the industry. Also, be very clear in understanding who will be doing the actual work on a project. The cartoon Dilbert pokes fun at consulting firms who have brilliant senior advisors lead the proposals and then disappear as they assign work to junior staff.
2. Retainer vs. Hourly.
In most cases, I prefer to pay consultants on an hourly basis or a fixed fee for one-time projects rather than sign a retainer. In my opinion, the only advantage of a retainer is the sense of security it offers to both parties. I prefer a contract that requires a budget proposal, weekly or biweekly reviews and adjustments, discussion and sign-off—which not only keeps consultants thinking creatively about my business, but also improves communication.
3. Communication Protocols.
Whether a consultant is actively working on a project or offering new ideas, I want to establish upfront how often and how we will communicate. Use status meetings to cover progress, staffing and billing, challenges and consultants’ needs from you or your team. The goal is simple: no surprises. Limit the number of personnel in meetings because a roomful of billing consultants can become very expensive. Regular face-to-face meetings can be useful, but quite often communication by phone, email or text can produce the same results and save time. I only allow my most-trusted consultants to work directly with each other, but they must keep me in the loop.
4. Setting Objectives.
Consultants have two masters: those whom they work for (sometimes themselves) and those whom they bill. The first master prefers a higher bill and the second master, a lower bill. The first three areas noted above—contracting, billing and communicating—come together at the critical point of setting objectives, which can be addressed by discussing and answering these questions, and can help you settle on a fair bill for both of you:
- Why do you propose I need your service?
- What are the measurable objectives?
- How will you work with me?
- What are our shared responsibilities to accomplish these objectives?
- What is your proposed budget?
- What is the time frame for this relationship or project?
- What are the anticipated outcomes and when will they be realized?
5. Measuring ROI.
This is not the last step of a project. Think of measurement as interval steps. Measurement is an opportunity to evaluate, change course, add or subtract resources and keep your project on target. Measurement targets should be evaluated on a defined, regular basis and again at the project’s conclusion. Use weekly or biweekly billing summaries tied to objectives and personnel performance.