I had the pleasure of interviewing John Hartsell and Jeff Scrabeck of DIZPOT
In 2017, entrepreneurs John Hartsell and Jeff Scrabeck established DIZPOT, a single-source, compliant packaging company for cannabis dispensaries and brands. Formerly in sales, Hartsell and Scrabeck entered the burgeoning cannabis space when they realized there was a void in industry-specific solutions for the market, as well as packaging specialists with compliance expertise. DIZPOT started as a wholesale operation and quickly evolved to meet the growing needs of the industry. Now a full-service branding and design agency, DIZPOT has developed hundreds of brands and served small and large-scale, multi-state operators in U.S. state markets and Canada.
Thank you so much for your time! I know that you are a very busy person. Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
In late 2016, we were in San Diego to attend a live concert for a band called X. As music lovers and avid live show goers, we spent the weekend immersed in the culture of southern California. During our time there, we visited a local brewery and bar called The Monkey Paw. It was here a few local brews deep when I explained to Jeff that he had lost his ability to earn income from the vast network he had created after his previous, cannabis-facing company had been acquired. In this moment, Jeff exclaimed, “Let’s start a distribution company.”
Within two months, Jeff and I had secured funding, established a new business, and began to sell goods which largely started with generic packaging. We quickly pivoted to custom packaging when a new potential customer Swell (Arizona’s largest chain at the time) needed a custom box for their cartridges. While Swell had been working on the box for several months, I claimed, “We can make that box in 3–4 weeks.” DIZPOT delivered on this promise and has continued to provide Old School Service to its customers ever since.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
In the first few months of business, DIZPOT had become the go-to packaging company for most Arizona-based licensed dispensaries. One of the state’s largest organizations is called Nature’s AZ Medicines and they wanted “Loyalty” jars large enough for an eighth of medicine (flower). We printed samples which looked to be both high quality and beautiful. Our procurement team proceeded with the order which at the time was one of our largest orders. In eight-weeks we received 10,000 jars which were well-printed and seemingly what was ordered. When compared to the original, the manufacturer had definitely used a smaller size. That’s not the funny part…these jars came out of the boxes and we set them out on a table in our office. A few minutes later the slip lids, think candles in jars, started toppling off of the jars and falling over onto the table. That’s not good for a jar that is supposed to be airtight to keep your cannabis fresh!
What did we learn? Our Old School Service approach is righteous and would lead us to great success. While it hurt to swallow the loss on this order, we did anyway, and it paid off many times over in future business with this customer and many others.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
Over the past three years, DIZPOT has been the beneficiary of help from so many it would be hard to single out any one person or entity individually. If there was one entity to thank, it’s our staff — the team at DIZPOT is committed to our organization’s core values and live them day in and day out. We thank our staff for our success in business more than anyone.
Extensive research suggests that “purpose driven businesses” are more successful in many areas. When your company started, what was its vision, what was its purpose?
It has been our vision from the very beginning to become the world’s largest service organization to the Cannabis Industry. With that purpose in mind, we laid out three core values which lead our efforts daily: 1. Old School Service
2. No Hesitation
3. Golden Rule.
These policies encompass our go-to business strategy and are in action every day. In fact, any DIZPOT team member will tell you not only what these values mean to DIZPOT but, what they mean to them personally.
Thank you for all that. Let’s now turn to the main focus of our discussion. Can you share with our readers a story from your own experience about how you lead your team during uncertain or difficult times?
Leadership during uncertain times is what defines an organization and its character. It’s simple in our business, not one person at DIZPOT is above or below having great ideas. This is especially crucial to solving issues during challenging times. Think about our core values, each one is specific to handling high-paced, challenges within an industry which is experiencing explosive growth. DIZPOT is built to take on tough challenges by being entirely engaged.
Did you ever consider giving up? Where did you get the motivation to continue through your challenges? What sustains your drive?
Never. Our drive is sustained by the opportunity to out-serve the industry amongst our competitors. DIZPOT wants to be known for how much it brings to the table whether that’s among our team, our customers, or our vendors. Our energy is sustained by meeting and exceeding needs and expectations.
What would you say is the most critical role of a leader during challenging times?
When the future seems so uncertain, what is the best way to boost morale? What can a leader do to inspire, motivate and engage their team?
At DIZPOT, you’ll hear team members sharing each time they witness their colleague meeting the challenge to live within the core values of our business. Folks need only to understand their role and how to crush it every day to feel like they are valued. Valued team members = motivated and inspired work.
What is the best way to communicate difficult news to one’s team and customers?
Honestly and directly without judgement.
How can a leader make plans when the future is so unpredictable?
Predictability is the enemy of entrepreneurs. While our goal is to provide a service and product which is predictably great for our customers, we welcome the uncertainty of the future for our industry. For Cannabis, change is the only predictable factor.
Is there a “number one principle” that can help guide a company through the ups and downs of turbulent times?
Treat people fairly and with respect. There’s not a single person or entity which is immune from having a bad day or a tough time. Now’s the time for those in business to stand with each other and find ways to support others who are trying to engage in our economy. It’s time to use our differences as an advantage and work in cooperation and not in competition.
Can you share 3 or 4 of the most common mistakes you have seen other businesses make during difficult times? What should one keep in mind to avoid that?
Wow, we’re students of other businesses, that’s how we’ve come up with most of our great ideas — adapting others great ideas and using them to our advantage. So, isolation is maybe one of the biggest mistakes we see from many of our small business colleagues.
I can’t say too much about other’s mistakes, but one of our biggest mistakes was being slow to make investments in top quality staff which can act autonomously and bring value to decision making. These folks brought new business intelligence to DIZPOT both north and south. We as owners became better and the staff they are managing became more effective.
Generating new business, increasing your profits, or at least maintaining your financial stability can be challenging during good times, even more so during turbulent times. Can you share some of the strategies you use to keep forging ahead and not lose growth traction during a difficult economy?
The Cannabis industry is new and growing. Our business strategy to generating new business is simple, provide excellent service and quality products in a timely manner. Through that, DIZPOT has grown by at least 50% each year and this year will grow by more than 100%. Additionally, we’ve added technological sophistication enabling online purchasing and software to meet our need for greater efficiency.
Here is the primary question of our discussion. Based on your experience and success, what are the five most important things a business leader should do to lead effectively during uncertain and turbulent times? Please share a story or an example for each.
- Have Core Values. At DIZPOT, our team commonly leans on its core values to decide how to act in situations. Recently, with COVID disrupting our community with the requirement for social distancing and many other restrictions our team began to address its interactions with vendors and customers. Without hesitation, we limited outside interactions to only essential activities such as pick-up and delivery. Additionally, our team is wearing masks in the office and in any case of potential exposure, team members are required to test and quarantine until their test demonstrates they are not positive with the virus. These disruptions and restrictions may seem difficult to deal with, but through our core values, the team at DIZPOT has a great outlook and takes on each day with a positive approach to serving our customers.
- Use data to ensure confidence. There are incredible resources for business intelligence in the Cannabis Industry. Over the years, our team has been focused on knowing how and why our industry is growing and has adapted our approach to efficiently service our customers. We see our customers as partners in industry and commonly purchase data for our use when working with them. Each year, we purchase annual reports from MJBiz and BDS Analytics which are rich with valuable and relevant data demonstrating the growth of our industry. With this data, DIZPOT can more effectively support its customers when making decisions about packaging and product/brand development.
- Surround yourself with intelligence. Our business started with two sales guys and a computer inside four walls. While Harts and I were willing to work incredibly hard and had been in several businesses previously, the work we’d be required to do was way over our heads. As the business grew and cashflow allowed, we decided to hire talent — folks that would bring efficiency in growth enabling DIZPOT to gain on the market for Cannabis packaging much faster. In three years, the DIZPOT team has grown from a couple of guys to a diverse group of nearly 30 professionals from very different personal and professional backgrounds. The intelligence which makes up the DIZPOT team is both culturally and professionally relevant to its success.
- Experiment a lot and be willing to make mistakes (fail forward). In all walks of life, experimentation makes up the elasticity of any personal and organizational growth. Stretching the limitations of an organization is the only way it can determine its core competencies and to eliminate initiatives which simply do not fit the organization’s vision or mission. If anyone or group is going to experiment, they should be focused on the purpose of the experiment, define success or failure, and understand the plan forward regardless of the outcome. Having a plan in the event of success is easy. Having a plan for failure may sound odd, but, that’s how you can ensure that you fail forward — now you can narrow your focus to become much stronger in your endeavors in areas which better fit your core.
- Do not pretend that things are not different, they are. Right now, the world is simply different. In our world, there are less ships on the sea, less planes in the air, and less trucks on the road. That means the logistics of moving goods globally, nationally, and locally has become incredibly difficult. Our team is geared to address these limitations through creative approaches to moving our goods to customers across legal Cannabis marketplaces. Instead of attacking these issues with the same approaches we’ve had in the past, we immediately triaged the situation and leveraged internal knowledge and external consultants to meet the challenge with solutions. We always take this approach and it seems work well because problems do not go away with time, they go away with solutions and hard work.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
“Life should not be a journey to the grave with the intention of arriving safely in a pretty and well preserved body, but rather to skid in broadside in a cloud of smoke, thoroughly used up, totally worn out, and loudly proclaiming ‘Wow! What a Ride! ‘” — Hunter S. Thompson
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