What You Need To Know About Starting A Medical Marijuana Dispensary
If you’re an entrepreneur who’s not afraid to roll up his sleeves, opening a cannabis dispensary can be a great idea. With the increase in the number of states that have legalized the sale of recreational marijuana, it’s a great business opportunity. According to the marijuana business daily, the revenue generated by dispensaries in 2019 was about 8 billion dollars. This has been due to the sizeable insatiable consumer market that continues to rise day by day. In fact, the marijuana market value is projected to triple by over 30 billion by 2025.
Though this business offers an excellent opportunity to make profits, starting a new dispensary isn’t easy. The cannabis industry is heavily regulated, and failure to have the required licenses and permits can lead to steep fines or even store closure. This article explains some things you need to know about starting a marijuana dispensary.
- Legal Risks
Though many states have legalized recreational marijuana use, there are risks associated with selling it. Cannabis is still regarded as an illegal drug at the federal level. It’s classified as a Schedule 1 drug by the Federal Substance Act. That means that its use can only be suggested but not prescribed. Coupled with this, there are no legal acts regarding starting dispensaries according to federal law.
Therefore, to stay within the legal framework, you need to hire a lawyer that’s well versed in this industry. Such a lawyer will advise you on the legal risks associated with the business and how to avoid them. He may also guide you on building your team and helping you acquire the relevant licenses and permits.
Apart from that, it would be best if you also considered the financial risks associated with starting this business. Opening every business requires financial investments. Securing your dispensary funding may be difficult through traditional lenders because most banks fear to finance and to offer loans to cannabis businesses. Therefore, you may have to save or rely on grants from friends and relatives to get the required capital, which may be between 200,000 to 800,000 dollars.
Like any other business, a dispensary needs the right location. However, cannabis stores face the challenges of having to follow additional rules before securing a site. Most states bar dispensaries from being established 1000 feet from community centers, schools, and churches. The rules also state that dispensaries must be located in their own building and not be part of a shopping complex or strip mall.
The other challenge about location relates to owning or leasing a building. If you have enough funds to buy your own building, you’re lucky because you’re free to do whatever you want with its space. On the other hand, leases may make owners scrutinize your business further or even deny you from renting the property.
You also need to consider a location that most people prefer. From online searches such as ‘how can I find a cannabis dispensary near me?’ you can identify where most customers live and want you to set up a shop.
Starting a cannabis dispensary business may seem to be very lucrative. However, numerous challenges come with it. Therefore, before venturing into it, ensure that you understand the risks involved and find a suitable location.