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How to Start a Marijuana Dispensary

How to Start a Marijuana Dispensary

Marijuana is the number one sales crop in the united states. It’s been predicted that the cannabis industry will be worth more than 30 billion us dollars by 2025. But with this potentially profitable business comes a lot of risks to entrepreneurs.

There are lots of confusing and often contradicting local and state laws. And, marijuana is still considered a schedule one drug by the federal government—that is just the tip of the iceberg. 

If you are willing to face the risks, the marijuana industry can be a highly rewarding one. So, if you are not sure where to start, we will tell you how to start a marijuana dispensary.

How to Start a Marijuana Dispensary

When you start the journey to owning a dispensary there are several obstacles you will have to overcome. There are state and local regulations about who can open a dispensary and who cannot, as well as nearly every other aspect of the marijuana industry. There also some very pricy upfront costs too. It can cost anywhere from $2,000 to $250,000 just to get a cannabis license, depending on your state. Additionally, many states restrict their application period to a specific window of time. Let us start with some things to think about before getting started.

Before You Begin 

To begin, no one with drug felony charges against them can be involved in the cannabis industry at all, until that record is expunged. Having a drug felony makes you a high risk in this highly regulated industry. 

Before you start the application process, make sure you have your business plan together. Most states require business plans and employee plans (hiring and training) on the application. We will go over this a bit more later. 

The application process will vary according to where you are opening your dispensary. One thing they will have in common is the lengthy and costly process. It typically takes up to 18 months to go through the whole process and can cost hundreds of thousands of dollars. The application process can be quite cumbersome. There are many consultants that will assist you with an application, however their fees generally approach six figures.

It is also important to note that FDIC banks usually will not lend to entrepreneurs in the marijuana industry because of the high risk associated with it and the fact that it is still federally illegal. So, funding your startup a dispensary will have to be done through alternative means.

Get Educated

It is a good idea to educate yourself about your state and county cannabis regulations and other area regulations because they can vary greatly. You may also want to retain a cannabis lawyer to help you to make sure you do not miss anything.

You will definitely want to learn more about marijuana itself. This can be useful because many patients and first-time users may be nervous about coming into a dispensary. While employees will be working with these patients, the owner should also be able to reassure them and explain which products fit their needs best as well. Some states now require all owners, manager and employees to attend annual training to ensure everyone is on the same page for information.

As a prospective owner, you will want to research typical rent costs in the area you want to open in and see if the city allows dispensaries – many cities have put a ban on cannabis dispensaries. Do your research on costs associated with stocking your store, not to mention the typical wages for cannabis employees

Writing a Business Plan

Now that you have an idea of what you are getting into, let’s write that business plan. This is going to be the blueprint of your business. Statistically, entrepreneurs that have a professionally written business plan are more likely to follow through with that plan.

You will want to include an executive summary, market analysis, sales and marketing plan, and more. These will give you and your potential investors or partners an idea of what the market is like, the potential gains and risks, and what you need to do to be successful. 


Now that you have educated yourself and written your business plan, it is time to make a budget. This is going to be a particularly important step. This will be a detailed report of your operational expenses so that will be able to project your profit line my accurately. You will want to include, rent, utilities, payroll, insurance, legal fees, license fees and of course, the cost to stock your shop.

Sticking to a budget can help you maximize your potential profit and keep you from overspending in the wrong area. This step may also make you realize that owning a dispensary at this time is just not feasible, as it is an expensive venture.

Advertising and Marketing

This may seem obvious since every successful business has an advertising and marketing plan, but tricky for a dispensary with the strict regulations set upon our industry in many states. For example, you cannot use tv, radio, or even billboards to advertise your business in most states.

You can try social media but many platforms remove ads related to cannabis. This can sometimes be problematic since social media is the biggest marketing platform available. Not all platforms discriminate against cannabis but it is worth trying. We have a few ideas for you here

Build Your Team

You will want to build the best team possible. Employees that are assets not liabilities. This is going to include your store employees and those working with you behind the scenes. Consider using a cannabis recruiter to help you find the best candidates for your entire operation.

And do not skip on finding the best dispensary agents. They ARE the face of your business so make sure they are well trained! These are the people who will be assisting your customers and handling sales and transactions. 

Your team members will also include accounting people (accounts payable and receivable), human resources, sales reps, inventory specialist and more. Start with the right candidates to keep your business running smoothly. 

Knowledge is Power

Now that you know the basics it is time to get serious. You can register for training on our website to help you learn everything you need to know. And do not forget to check out our other great articles on our blog. 

We hope you enjoyed this article on how to start a marijuana dispensary. Do not forget to share it on social media with your friends and family.