Ep 23: Who Gets Paid After Green Wednesday? — The Shift

with Filip Gacic · The Shift, a podcast by Headquarters

Record sales don’t always mean cash in the bank. We unpack Green Wednesday’s impact on cannabis margins, cash flow, and unpaid invoices.

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Auto-generated from the episode audio and lightly edited for readability.

0:08 Every year, right before Thanksgiving, something interesting happens in the American cannabis industry. While most Americans are preparing for Black Friday, cannabis retailers are preparing for something of their own, Green Wednesday.

0:26 And if you're unfamiliar with it, I think of it as the cannabis industry answer to Black Friday. It's the Wednesday before Thanksgiving when consumers stock up on cannabis products ahead of the holiday weekend. And over the years, it's become one of

0:44 the most important shopping days in the American cannabis calendar. But here's what I find particularly interesting about Green Wednesday. We spend a lot of time talking about how much money the industry makes during these events. We talk about record-breaking sales, increased foot traffic, promotional campaigns, and

1:04 dispensaries selling enormous amounts of inventory in a single day. And understandably so, because the numbers are impressive. According to industry data from Headset, Green Wednesday generated approximately $113 million in cannabis retail sales

1:22 across the United States in 2025. That's an extraordinary amount of money moving through dispensaries in just one day. But here's where I want to challenge the conversation a little. Does selling more necessarily mean making more money? Because those are two different things.

1:41 And there's actually some fascinating data that illustrates exactly what I mean. In one of Headset's analysis of Green Wednesday, the median cannabis retailer experienced a revenue increase of approximately 74%. Sounds fantastic, right? But

2:00 profitability didn't increase at the same rate. The median increase of profit was approximately 53%. Now, don't misunderstand me. That's still a very successful day for many retailers, but it demonstrates something

2:19 that I think gets overlooked in conversations about major cannabis shopping events. Revenue and profit don't necessarily move together because Green Wednesday isn't simply a day when customers suddenly decide to spend more money. It's also a day when retailers compete aggressively for those customers,

2:40 discounts, special promotions, bundles, loyalty offers, and sometimes increasingly aggressive pricing strategies designed to bring people through the door. And every one of those decisions has a financial consequence. Let's say a dispensary normally sells a product for

2:58 $40, but for Green Wednesday, they discount it to 30. Suddenly, they're selling more units, perhaps attracting new customers and generating significantly more transactions. But they're also collecting $10 less for every unit sold. And depending on what they originally

3:16 paid for that inventory, that discount could represent a substantial portion of their profit margin. Now, multiply that across hundreds of products, thousands of transactions, an entire day of promotional activity, and you begin to understand why a successful sales event isn't necessarily the same

3:35 thing as a successful financial outcome. But there's another part of this conversation that I think is even more interesting. The money doesn't begin or end at the dispensary. Because before a retailer can sell a single product on Green Wednesday,

3:53 somebody has to manufacture it, somebody has to package it, somebody has to distribute it, somebody has to deliver it, and somewhere along that process, somebody has to pay for it. Cannabis brands and distributors are preparing for these events long before the consumer walks into the store.

4:11 They're managing inventory, coordinating deliveries, forecasting demand, and making sure retailers have enough products available to capitalize on the holiday. And depending on the payment arrangements, some of that inventory may have been delivered before the supplier has actually received payment.

4:31 So while the consumer sees a promotional event, the businesses behind it are managing an entire financial operation, inventory commitments, payment terms, outstanding invoices, discounts, margins, cash flow. And that's where I think the Green Wednesday conversation becomes much more interesting from a

4:51 business perspective because imagine a retailer having its biggest sales day of the quarter while one of the suppliers responsible for stocking those shelves is still waiting to collect payment on previous deliveries. Or imagine a business reporting record

5:09 revenue only to discover that aggressive discounting and operating expenses have left it with much less profit than expected. Neither situation necessarily means the event was unsuccessful, but it does mean that the sales figures alone don't tell us the full story. And

5:29 that's what I want to explore in today's episode. Because Green Wednesday is a fantastic opportunity for the cannabis industry. But the real question isn't simply how much cannabis gets sold. It's what happens to the money before, during, and after those sales take place. And to

5:48 understand that, we need to look at what's happening behind the scenes. Here's something worth considering. By the time Green Wednesday actually arrives, a significant part of the financial story has already been written. Because retailers don't suddenly order all their inventory on Wednesday

6:07 morning, they've been preparing for weeks pretty much. And the brands and distributors supplying them have been preparing even longer. In fact, according to wholesale marketplace Leaf Link, cannabis retailers typically begin replenishing inventory around 10 to 21 days before

6:25 Thanksgiving. So, while consumers are waiting for the discounts, businesses are already making financial commitments. And that's pretty much where things get interesting because the timing of a sale and the timing of a payment are not necessarily the same thing.

6:44 Let's look at this from the perspective of a cannabis brand. You spend money growing or manufacturing your product, testing it, packaging it, and getting it ready for distribution. You've already incurred those expenses. Now, a retailer places a large order ahead of Green Wednesday. Great news. More demand, more

7:02 products moving, and potentially more revenue. But what if the retailer is purchasing on net 30 terms? You've delivered the product today, but you may not receive the money for another 30 days. And that's assuming the invoice gets paid on time. Meanwhile, your business still has

7:22 expenses. Employees need to be paid. New inventory needs to be produced. Transportation costs don't disappear. And your suppliers aren't necessarily willing to wait just because you're waiting on somebody else. So, a successful wholesale sales period can actually increase the amount of

7:40 money a business has tied up in accounts receivable. Now, there's nothing inherently wrong with extending credit. It's a normal part of doing business, but there is a difference between offering payment terms strategically and allowing unpaid invoices to dictate your cash flow.

7:58 And I've seen firsthand working in cannabis, accounts receivable, how quickly that distinction can become important. A retailer might be placing substantial orders, generating impressive sales, and maintaining a perfectly healthy

8:16 relationship with its suppliers until payments start arriving late. Maybe it's a temporary cash flow issue. Maybe there's an invoice dispute. Maybe credit hasn't been applied correctly, or maybe the retailer simply has more outstanding obligations that it can comfortably manage. Whatever the reason,

8:36 the supplier is now financing inventory that's already been delivered. And if that happens across dozens or hundreds of retail accounts, the financial exposure can become significant. Now, now let's look at the retailer side. Green Wednesday creates a different kind of pressure for them. They want enough inventory to meet

8:55 demand, but not so much that they're left sitting on expensive products after the holiday. They want competitive promotions, but they also need to protect their margins. And they want customers walking through the door, but they still have rent, payroll, taxes, supplier payments, and

9:15 other operating expenses to manage. A retailer could finish Green Wednesday with record-breaking sales and still have difficult questions to answer about its financial performance. Which products actually generated the most profit? How much revenue did we sacrifice through discounts? What did

9:34 those promotions cost us? And after accounting for everything, how much money did we really make? These aren't questions you can necessarily answer by looking at the sales total on your point of sales system. You need accurate financial records. You need to reconcile

9:52 transaction specifically. Account for discounts and credits, understand the costs of goods, and make sure that what your sales system reports actually matches your accounting records. And during a major promotional event, when transactions volumes increase and pricing becomes more complicated, those

10:11 processes become even more important. Because here's something that I think deserves more attention. A business can be operationally successful while being financially disorganized. You can have great products, strong customer demand, and excellent sales team, and even record breaking revenue.

10:29 But if your accounting isn't accurate, you might not fully understand your profitability. And if your accounts receivable isn't being managed properly, you might not have the cash available to support your next round of growth. These are two different problems, but they're closely connected. Accounting helps you

10:47 understand what's happening financially inside your business. Accounts receivable helps ensure that money owed to your business is being tracked, followed up on, and ultimately collected. And both become particularly important when you're dealing with seasonal spikes in demand because Green Wednesday isn't

11:06 happening in isolation. It's followed by Black Friday, the broader holiday shopping season, and eventually the end of the financial year. So the decisions businesses make in November can have consequences that extend well beyond Thanksgiving. A poorly managed receivables portfolio doesn't suddenly

11:24 become easier to collect because the holidays are over. And inaccurate financial records don't become less important when it's time to close the books. Which brings me to something I've always found interesting about the cannabis industry. We spend enormous amounts of time discussing how businesses can increase sales. but

11:44 considerably less time discussing how they manage the money those sales are supposed to generate. And those two really shouldn't be separated because ultimately one company's accounts receivable is another company's accounts payable. The retailer's inventory is the supplier's outstanding invoice and the supplier's outstanding invoice may

12:03 represent money it needs to manufacture the next batch of products. It's all connected. So when we talk about preparing for Green Wednesday, maybe we should be asking more than whether retailers have enough inventory or whether their promotional campaigns are ready. Maybe we should also be asking are their financial operations actually

12:22 prepared for the additional business because generating demand is one challenge. Managing the financial consequences of that demand is another. And this is where I want to bring headquarters into the conversation because everything we've discussed today from inventory financing and payment terms to profitability and

12:41 financial reporting represents the kind of operational challenges that cannabis businesses deal with every single day. Green Wednesday simply makes those challenges more visible. And at HQ, we work with cannabis companies to help manage the financial operations behind their businesses, particularly through

13:01 two of our services, accounts receivable and accounting. Now, let's start with accounts receivable because this is an area I've personally spent a significant amount of my career working in. One of the biggest misconceptions about collections is that the process begins when an invoice becomes seriously overdue. But effective

13:21 accounts receivable management should begin long before that. It's about knowing which customers owe you money, understanding their payment behavior, monitoring outstanding balances, and maintaining consistent communication before small issues become significant financial problems. And during periods like Green Wednesday,

13:39 that visibility becomes particularly valuable. Imagine your cannabis distributor supplying dozens of retailers ahead of Thanksgiving. Orders are increasing, inventory is moving, and your sales team is doing exactly what it's supposed to do, but at the same time, your outstanding receivables are

13:58 growing. Some customers have invoices approaching their due dates. Others have already missed payments, and a few might be placing additional orders while carrying substantial overdue balances. How do you know which accounts represent an opportunity and which ones

14:16 represent a financial risk? That's where a structured AR operation makes a difference. At HQ, our AR teams help cannabis businesses manage their receivables through consistent retailer outreach, payment follow-ups, portfolio monitoring, and reporting that provides

14:36 visibility into outstanding balances and collection. We also use our own AR dashboard to help organize collection workflows, track payments, commitments, and identify accounts that require additional attention. The objective isn't simply to send more payment reminders.

14:55 It's to give businesses greater control over the money they are already owed because generating another million dollars in wholesale sales sounds fantastic. But if a significant portion of your existing receivables remains unpaid, your businesses could still find itself under financial pressure. And that

15:14 brings us to the other side of this equation. Accounting. Now, I think accounting is particularly interesting in the context of Green Wednesday because the industry tends to celebrate revenue figures without always asking what those figures actually represent. A retailer might report a

15:32 substantial increase in sales, but how much of that growth came from aggressive discounting? How did those promotions affect gross margins? Were all transaction and payments recorded accurately? Were vendor credits and expenses properly accounted for? And

15:50 what does the business's financial position look like once everything has been reconciled? Those are the kinds of questions that accurate accounting processes help businesses. At headquarters, our accounting services support cannabis businesses with the financial work required to maintain accurate records, organize transaction,

16:10 reconcile accounts, and produce reliable financial reporting. And that matters because businesses shouldn't have to wait until something goes wrong to understand what's happening with their finances. Good financial reporting should help you make decisions, not simply document decisions you've already made.

16:29 Especially in an industry like cannabis where businesses are already navigating significant regulatory requirements, tax complexities, and competitive pressure. Now, here's where I think these two services become particularly powerful when we look at them together. Accounts receivable help you understand and

16:48 manage the money coming into your business from customers who owe you. And accounting helps you understand how that money alongside your expenses, liabilities, and other financial activity affects the overall financial health of your business. They're different functions, but they're part of

17:06 the same financial picture. And the stronger the picture is, the better positioned a company is to make informed decisions. Whether that's extending additional credit to a retailer, planning its next inventory purchase, evaluating the profitability of a promotion, or preparing for another

17:25 period of increased demand because growth without financial visibility can become a problem surprisingly quickly. And this is something we take seriously at headquarters because we believe cannabis businesses should be able to focus on growing their operations, building relationships, and serving their

17:43 customers without losing control of the financial processes that support that growth. That's why we combine dedicated people with structured workflows and automation, helping businesses reduce repetitive administrative work while maintaining visibility into their financial operations.

18:03 And whether you're a cannabis brand, a distributor, or a retailer, these are conversations worth having before the next major sales event arrives. Not after, because Green Wednesday will come and go. Some businesses will report record sales. Others will celebrate their best day of the year, and

18:22 we'll probably see plenty of headlines about how much money the cannabis industry generated over Thanksgiving. But here's a question I'd leave you with. When the promotions are over, when the customers have gone home and the sales numbers have been reported, how much of that success actually translates into a stronger business?

18:40 Because ultimately, that's what matters. And if your businesses need support managing accounts receivable and accounting, that's exactly what we do at HQ.