With a mantra of “not all cannabis is created equal,” a compound annual revenue growth rate of 60 percent, and a pioneering in-store color category system, Good Chemistry CEO Matthew Huron is redefining what a dispensary brand can be.
You don’t come from a business background but have been very successful in launching Good Chemistry.
My background is in cannabis cultivation, and high-quality cannabis is the foundation of our business. I honed my cultivation practice in a very competitive California market so I could treat people like my father and my father’s partner, who were trying to manage the painful effects of HIV. When it comes to our business success, we believe “the power is in the flower.”
You now have two shops. How did launching the second differ from launching the first?
We took all of the successes and pitfalls we experienced in creating the first store into the second store. We used that experience and combined it with an amazing team of branding, marketing, and store design experts to create our ground-breaking, award-winning Aurora store design.
Can you give us a snapshot of sales growth?
In the past two years, Good Chemistry has grown by more than 235 percent. Since inception, headcount has increased from ten employees to more than 100, and over the past three years Good Chemistry has increased its cultivation and production square footage by more than 400 percent. Since our inception, Good Chemistry Nurseries has achieved a compound annual revenue growth rate of approximately 60 percent.
How do inventory and buying work at Good Chemistry? Do you have one dedicated buyer?
Good Chemistry Nurseries is vertically integrated with the majority of cannabis products we offer. We grow 100 percent of all our flowers that range over sixty different strains, and Good Chemistry Nurseries manufactures all of our solventless concentrates like rosin, bubble hash, and dry sift. We do not manufacture the edibles, lotions, and several other select concentrates we carry. Our vice president of retail oversees all third-party purchases, because we believe all cannabis products sold at Good Chemistry must compare in quality to our premium cannabis flowers. We’re very critical and selective when we decide to carry an outside third-party product.
Talk a little about the Craft of Cannabis campaign.
Craft of Cannabis is focused on the relationship between people and plants—how we coexist together and how we need the plants as much as they need us. We have a deep commitment to product and production excellence, and the Craft of Cannabis campaign is designed to promote high-quality cannabis.
The idea for S.T.A.T.S.—sight, touch, aroma, taste, sensation—came from our customers. Legal cannabis is no longer as much of a novelty, and customers are looking for more. Customers are realizing that all cannabis is not created equal. So about a year ago, in response to customer request, we committed to creating a consumer evaluation tool similar to what exists for diamonds and wine, available free of charge in print and online. We took a cultivation team with over 100,000 hours of experience and shared the same techniques they use to create and evaluate high-quality cannabis with the public. We believe it’s good for the whole industry when our customers can quickly and easily identify production excellence. We think we all benefit from that. You can find hard copies of the S.T.A.T.S. guide at Good Chemistry locations in Denver and Aurora. You can also download an electronic version at STATSguide.org.
How have your three indoor grows shaped the economics and scalability of your retail operations?
They’re absolutely vital. Our company is focused principally on our nurseries, but we have taken a “go slow to go fast” approach. We’ve developed specific indoor cultivation techniques that have allowed us to replicate and improve the quality of our product in a scalable way, so we’re able to produce the quality flower our customers have come to love and respect.
In three years, Good Chemistry has gone from 10 employees to more than 100 – CEO Matthew Huron
Do you use a service for staffing?
For the majority of our hires, we have fortunately had a number of qualified applicants approach us directly or by email at [email protected] We have also used Vangst (formerly Gradujuana) on several occasions and sponsored a few career fairs.
How have you so successfully dealt with the problems of compliance?
Good Chemistry Nurseries is a strong supporter of a well-regulated industry. We take compliance very seriously and have hired a compliance officer from the aerospace industry with thirty-five years of experience to make sure we meet or exceed all of the necessary regulatory requirements. I have personally collaborated with local leaders and law enforcement to enhance neighborhood safety and security. I have personally served on the Colorado Department of Revenue’s Medical Marijuana Enforcement Division’s (MED) Licensing Authority Advisory Committee, which was charged with advising regulators on the development of production management, tax and other policies pertaining to the use of marijuana. I and other members of our senior team continue to be active by participating on regulatory workgroups yearly.
Talk about your pioneering in-store category system. Has it affected your bottom line?
Yes, quite a bit. We believe an educated customer is our best customer. A top priority for the Good Chemistry Nurseries team is to help consumers comfortably explore the world of cannabis and see how it might best fit into their lives—much like the way they shop and learn about other products. To address this need, we created our category system to help people more easily navigate levels of lift available from the diverse range of cannabis strains and products. The colors, iconography, and names and descriptors at the heart of the Good Chemistry category system are integrated in all aspects of our store design, from displays to sophisticated digital menus, interactive and informative iPads, and packaging. They serve as one navigation tool for what is for many still a relatively new and complex world. We think the category system has been well received by our customers because they appreciate the time and energy we’ve put into helping them find and create the experience they’re seeking.
What’s the secret to your success?
It’s all about the relationship with the plant. Fifteen years ago, I invested everything I had into my few small plants. Around that time, I had the realization I had a genuinely codependent relationship with the plants. I realized we need them just as much as they need us. As I came to this realization, I began engaging in serious, meaningful conversations with the plants just as I would with any business partner. I have continued this conversation to this day, and we have managed to develop a very successful partnership.
The Right Business Sense
Growth not just for growth’s sake
While some companies are racing to explode with growth, Good Chemistry believes “careful, cultivated growth” is the key to growing the finest cannabis and strong, long-term business success. Good Chemistry Nurseries is not growing for growth’s sake. “We have turned down tens of millions of dollars in venture capital offers. We have turned down multiple license opportunities. We have turned down acquisition opportunities,” Huron noted.
For more on Good Chemistry go to goodchem.org