May 13, 2020

The Benefits of a PEO Structure for Cannabis Companies During the COVID-19 Pandemic

by McKenzie Swisshelm

It’s always been true that times of economic uncertainty can change an industry landscape into an extreme version of survival of the fittest, and the current COVID-19 pandemic is no exception.

While it’s no great secret that the cannabis industry has seen a drastic increase in sales over the past few weeks, not all businesses will be able to make it through the current situation unscathed.

Businesses that hope to survive this pandemic must be willing to adapt and to make crucial decisions. For the cannabis industry, one such decision may come down to choosing between a PEO solution or a payroll only structure.

We understand that both options provide advantages for cannabis businesses. After all, payroll services are an essential aspect of any business. However, PEO (Professional Employer Organizations) provide so much more than just payroll.

During this time of uncertainty, cannabis businesses need a solution that can free up their time and energy to focus on what matters most – providing a better service for their customers.

Let’s take a look at 5 benefits of adopting a PEO structure that specifically address unique problems created by the current COVID-19 pandemic.


Top 5 Benefits of a PEO for Cannabis Companies


1)   Free up your creative capabilities to thrive

Teaming up with a full-service HR provider who understands the cannabis industry inside and out can free you up to focus on the core of your business: serving your customers.

Ever more creative solutions are needed to ensure customer and employee safety while maintaining normal business operations. By standardizing the predictable and mundane, PEOs can help you better manage the unexpected.

City ordinances, state laws, and government recommendations are changing daily during this time of crisis. Your time may be better spent setting up contact-free drive-through operations, designating specific business hours to service the most at-risk customers, and brainstorming any number of new ways to reach your clientele safely and with ease.

This is why outsourcing payroll and other HR administrative tasks during this time is truly an investment in your business. It allows you to focus your energy on improving your business so that it can flourish during this time of uncertainty rather than just allow you to barely make ends meet.

Switching to a PEO from a payroll-only system can increase efficiency, effectiveness, and cost optimization of valuable resources, including intangibles like creativity, ideation, and peace of mind.


2)   Help You Keep Up with Current Demand

Cannabis dispensaries across the nation are seeing a massive wave of sales across the board. Whether this spike in sales is due to the fear of a months-long quarantine created by the COVID-19 pandemic, or any number of mental and physical stressors also created by the current social environment, one thing is clear – an opportunity has been created for businesses in the cannabis industry.

Designated as an essential industry that provides medicinal products to thousands in need, cannabis businesses need to respond to the current rise in demand by ensuring a steady stream of supply. That may require hiring additional personnel to keep cannabis operations running smoothly.  

While the hiring process is a tedious and stressful task in the best of times, it can be an actual nightmare under present conditions. Many dispensaries are finding that they need to increase the size of their staff to keep up with demand, causing significant strain on the time they have to devote to the running of regular business operations.

Switching from a payroll-only system to a PEO can help you standardize the entire employee management process. From recruiting to training, a cannabis-specific PEO can seamlessly integrate new hires into the business, reduce miscommunication and errors, and ultimately help your business keep up with the increased demand by customers to maintain its much-needed competitive edge.


3)   Reduce Legal Liability in an Ever-changing Business Landscape

Legal compliance is key to running a successful business. Regardless of how much profit a business is bringing in, if it isn’t complying with all state and federal human resources laws, it won’t stay in operation for long.

Maintaining compliance with legal regulations is always important, especially for those in the cannabis industry.

Businesses need to stay up-to-date in order to stay on the right side of the law regarding all newly established requirements, such as the Families First Coronavirus Response Act, which requires business owners to pay extended sick leave for employees who aren’t working during the pandemic.

Switching to a PEO system during this harrowing time can be invaluable to stay one step ahead of all logistical requirements created by the current pandemic. 


4)   Improve Employee Relations and Boost Your Brand’s Marketability

Switching to a PEO solution during the COVID-19 outbreak can really help you kill two birds with one stone. Not only can it help you improve employee relations, but it can also increase sales.

Savvy businessmen are aware of the changing tides in what people are looking for in the businesses they choose to frequent. Dirt cheap prices at any cost is no longer in vogue.

Nowadays, customers are very picky about where they spend their money. Instead of going on mindless shopping sprees, many consumers are aligning themselves with brands that share their same beliefs and values.

This is where choosing to switch to a PEO solution comes into play for your cannabis business. The right PEO can provide cannabis companies with great employee benefits that they otherwise wouldn’t have had access to on their own.

From workers’ comp to health care, switching to a PEO can drastically improve the benefit packages offered by your company. People want to support companies that support people. So, by switching to a PEO you can use the improved employee benefits to increase sales and create brand loyalty.


5)   Set Yourself Up for Continued Success

Even though the cannabis industry has been experiencing an unexpected boom for the last few weeks, it’s important to recognize that this too won’t last – or, at least it won’t for those who aren’t already preparing for future shifts and changes to the industry landscape.

Switching to a PEO solution isn’t just beneficial to cannabis businesses in the short-term during this current crisis situation. It’s also an incredible long-term investment that can help you continue to grow your company after this pandemic period is well over.

Outsourcing tedious payroll and HR tasks to a cannabis-specific PEO enables businesses to experience rapid growth and expansion.

Businesses that utilize a PEO grow 7-9% faster than those that don’t, experience 10-14% less turnover, and are 50% less likely to go out of business.


By helping you streamline the business expansion process, you can focus on continuously finding new and better ways to serve your customers.


Final Thoughts


Switching from a payroll-only system to a PEO (or simply choosing a PEO for your cannabis company right off the bat) can help your business thrive in a world stricken by fear and uncertainty. 

It may also be just what you need to come out on top of this crisis situation and set yourself up for future success.

To learn more about what a cannabis-specific PEO can do for your company, reach out to Greenleaf HR. Our goal is to help your cannabis business thrive during these difficult times.  Contact us today for more information.  

McKenzie Swisshelm

McKenzie Swisshelm is the Marketing Manager for Greenleaf HR and Worklogic HR. She produces effective content like a fifth-year wizard but with a knack for strategic marketing, crafting digital strategy and, of course, Charms. In more wanky marketing muggle jargon, her specialties include setting metrics and reporting systems and then refining all of the above to impact an organization’s core business objectives and drive top line growth.

Related posts


Why Isn't Payroll Easier for Cannabis Businesses?

It’s always been true that times of economic uncertainty can change an industry landscape into an extreme version of survival of the fittest, and the current COVID-19 pandemic is no exception. While...

13 May, 2020