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The Herbal Care officially opened on Jan. 4, becoming the first legal adult-use dispensary in Manhattan’s Upper East Side neighborhood.
Business is slower than expected, said owner Markel Bababekov, who also said his largest business concern is competing with NYC’s extensive unlicensed market. However, the store is drawing in some 100 customers on a daily basis, Bababekov said.
In a Q&A with NY Cannabis Insider, Bababekov answered questions about what customers are buying, transitioning from running a cleaning and construction businesses to owning a weed store and competing against the illicit market and large MSOs simultaneously.
About how many customers are you seeing per day? How does that compare to your projections before opening?
We see about 100 people a day. This is a little slower than we thought we would be.
How many full-time and part-time workers do you employ?
The Herbal Care has 35 employees.
What kinds of products are selling the most?
Vapes and flower are most popular with our customers.
What brands are selling the most?
Dank, MfNy and Ayrloom are our most popular brands.
Which demographics do you see as your target market?
We don’t have any specific demographic we are targeting. Everyone over the age of 21 is a potential customer.
Can you describe your business experience outside of cannabis?
I own a dry cleaning company. We do dry cleaning for the movie and TV industry in New York. I also own a construction company, where we remodel residential homes, and a consulting company, where we sell leads for contractors.
How does that experience translate to running a cannabis dispensary?
Retail is retail, but because the cannabis industry is highly regulated, it’s a very different experience.
How much of a problem do illicit cannabis shops present to your business?
Illicit cannabis shops are my biggest concern as a licensed dispensary owner.
Are you worried about competing with adult-use dispensaries owned by ROs?
Yes, I’m very worried. These companies have a lot more money, and a lot more experience than us small-timers. They have bigger marketing budgets and more money to build a store in a better area.
Can you tell us about your long-term plans for your store?
My plan is to expand and open more stores.
What state cannabis policies/regulations do you think are the most helpful to your business?
I support the SMOKEOUT act and hope it can pass this session. It will do a lot to help eliminate illicit shops.
What state cannabis policies/regulations do you think present the most challenges to your business?
The state isn’t doing enough to shut down the illicit stores. I’m also disappointed that they approved the ROs to collocate sooner than expected.
Can you describe how you’re hiring and training employees?
We work with a nonprofit called Hospitality Pathways that supports people who recently got out of prison and need a second chance. We are excited to be in a position to give these folks a second chance. We also use Indeed. For training, we have different vendors that we work with come out and train our staff. We have vendors coming every week for training. We also hired a consulting company responsible for training my whole staff.
What advice would you give to other entrepreneurs planning on opening dispensaries?
Make sure you have enough capital, a really good team behind you, and know all the regulations. And hire a great lawyer!!