5 Things to Know Before Opening a Dispensary

5 Things to Know Before Opening a Dispensary

As the cannabis industry continues to soar to new heights, there is a new wave of intrigued entrepreneurs who are looking to break into the green business. According to a recent study by Forbes, the cannabis industry is set to exceed more than $200 billion by the end of 2030. With figures such as these, it is no surprise why the once-taboo industry has become quite appealing. However, similar to any other industry, there are rules and regulations that owners must comply with at all times. Additionally, since companies are selling drugs, the levels of expectations among compliance are high and without wiggle room. Here are 5 things every entrepreneur needs to know before opening a dispensary to sell cannabis.

Apply for a Retail Dispensary License

The first thing prospective business owners ought to do is apply for a dispensary license. For business owners interested in establishing a retail dispensary operation, the license application cost is $4,500 in addition to $2,500 due to the local municipality that is due when applying. Additionally, $1,800 is due annually to renew the retail license. There is also a variation of licensure for companies interested in providing medical-grade cannabis. To apply for a medical-only cannabis dispensary, the combined fees of the application and licensing fee is approximately $9,000 for businesses assisting up to 300 patients. For larger-scale operations, $16,000 for up to 500 patients and a hefty $22,000 for businesses who plan to assist more than 500 patients.

Understanding Purchasing Limitations

In most states that have legislation in place for the sale of recreational cannabis, any individual who is at least 21 years of age with valid government ID is allowed to purchase as well as possess up to 1 ounce, which is equivalent to 28 grams of marijuana in a sole transaction. This amount is not limited solely to dry cannabis buds. This amount can buy a variety of cannabis buds, edibles, and even concentrates.

Compliance with Taxation

Like any other industry, cannabis is taxed. Categorically, there are 3 forms of taxes associated with recreational cannabis. These forms of taxes are general sales, special retail, and excise tax.

  • General Sales Tax is the state minimum tax that is attributed to virtually all products sold for profit.
  • Special Retail Tax is the tax attributed to exclusive retail products, including cannabis.
  • Excise Tax is the tax attributed to the sale of tobacco, alcohol, and cannabis. 

Compliance with Sales Metadata, Quality Control

One of the most important dispensary laws applicable to states providing legal cannabis is to consider is that all operating MED Licensed Retail Cannabis operations are mandated to possess an active Metrc account. Moreover, these facilities must have all inventory as well as plants associated with the business tagged with a Radio Frequency ID, or RFID, before the first transfer or sale of cannabis or cannabis-related products. Additionally, Licensed Testing Facilities are tasked with timely and accurately providing test results of cannabis products into the organization’s active Metrc account.

The Importance of Package & Label Compliance

Another extremely important key for those who are interested in opening a dispensary is proper labeling. In regards to cannabis and cannabis-related products, all products and inventory that a dispensary sells must ensure that all packaging and labeling of retail cannabis comply with recreational/medicinal cannabis state laws and uses the proper regulatory language. Recently, legal cannabis states have implemented a Universal Symbol. The  “! THC”  symbol is now a crucial component for the consumer and child tamper-evident protections. Furthermore, the enforcement of this new universal symbol per legislation is a public safety priority and is key to cannabis compliance.

Leave a Reply

%d bloggers like this: