What Does it Take to Open a Dispensary?

With cannabis becoming more popular across the nation, entrepreneurs are becoming more involved in opening up a cannabis dispensary. Like any other industry, there are stringent rules and regulations potential business owners and operators must follow per state legislation. Late last year, two separate companies were found in violation of cannabis production and distribution laws. A California cannabis producer was forced to destroy their surplus of cannabis, equivalent to $95 million, due to failing to meet requirements outlined by the California Department of Consumer Control. Furthermore, another cannabis company was the star of a federal raid due to a whistleblower reporting to authorities the illegal pesticides being used during production. Here are a few critical concepts potential cannabis business owners and operators should consider when establishing a successful and legally sound cannabis dispensary virtually anywhere in the states.

Actually getting the license

The initial step to opening a dispensary in any state is obtaining the proper licenses. Although every state’s process of obtaining a dispensary license is different, they are fairly similar. First, prospective owners must decide if they will provide medical cannabis or recreational cannabis. This is because the applications and fees associated with medicinal and retail cannabis are very different. However, both of them are typically pricey. Application fees can range from $8,000 to $25,000, depending on factors such as locale and quantity of patients. The fees associated with consulting, infrastructure, and product will make the application fees look like middle school lunch money.

Rules and limits

In most states, any individual at least 21 years of age with a valid government ID is allowed to purchase and possess up to 1 oz, which is equal to 28 grams of cannabis in a single transaction. This amount is not limited solely to traditional cannabis buds. This amount can buy a variety of cannabis buds, edibles, and even concentrates. However, the laws for the recreational sales of cannabis in most states are a bit more brain-boggling in recent years. As of October of 2016, a handful of states has implemented what is referred to as ‘Marijuana Equivalency’ rules, or simply ‘MED.’ States that have MED rules that some products, including concentrates, have a higher level of THC than their dry cannabis flower counterparts. This means that a customer is not allowed to purchase the same amount in both forms.

Labeling and Compliance

Another vital key for those who are interested in opening a dispensary is proper labeling. Regarding 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 state laws and uses the appropriate regulatory language. Recently, a few states have implemented a new Universal Symbol: “! THC” This symbol is now a crucial component of the consumer as well as child tamper-evident protections. Moreover, enforcing this new universal symbol per legislation is a public safety priority equivalent to compliance. Because the new Universal Symbol “! THC” is meant to be viewed by the consumer as well as a third party who comes in contact with the product (i.e., minor meddling in a medicine cabinet or someone with a cannabis-related allergy). This is known as the front-facing exposure requirement; now, with a new universal caution, the use of the symbol is clear as day.


Forbes expects the cannabis industry to gross over $210 billion within the next decade. With figures such as these, it is evident why the cannabis industry has become quite alluring. We expect the cannabis industry to surpass the $200 billion milestones well before 2030.

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