How to Open a Dispensary in California
By Liam Noonan
6/12/21
California is a massive state with an enormous economy. If you’re looking to open a cannabis dispensary here you may have made the right choice.
You’ll have plenty of competition, but if you’re up for the challenge, this article can help you get started.
Continue reading for a step-by-step guide that explains how to open up a weed dispensary in the Golden State. You’ll learn what you need to get your cannabis license application started and what to do while you wait on the approval process.
Who Can Open a Cannabis Dispensary in California?
Anyone in CA over the age of 21 can legally purchase cannabis for recreational or medical purposes. To open a legal dispensary in California and serve the market you will first need a license.
Due to the liberal granting of cannabis dispensary licenses in the State, it’s a great time to open up a storefront. It won’t be easy, but with some careful planning, it can be done. The state of California has already issued over 10,000 licenses to Cannabis businesses since 1996. Some of these business types include:
- Cultivators
- Manufacturers
- Retailers and Dispensaries
- Distributors
- Testing Labs
- Event Organizers
- ETC.
Who Controls California Dispensary Licenses?
When it comes to granting cannabis licenses, there are three State-level governing authorities responsible for regulating California’s legal cannabis industry.
1. The California Department of Food & Agriculture:
The CDFA is responsible for licensing cannabis cultivators and farmers.
2. The California Department of Public Health:
The Manufactured Cannabis Safety Branch of the CDPH oversees that cannabis manufacturers adhere to established security requirements for licensed cannabis businesses in California. Not only are licensees required to adhere to state-level security requirements, but they are also obligated to comply with any security policies established by their local jurisdiction.
The California Department of Health doesn’t require cannabis cultivators to submit a security plan to obtain a license, however, other applicants will need to develop and implement a security plan that is required to –
- Prevent unauthorized access
- Protect employee safety
- Prevent against theft and loss
- Secure electronic records to prevent unauthorized access and back up electronic records to ensure the integrity of information
- Install a video surveillance system on the licensed property that records areas in which cannabis or cannabis products are stored, prepared, or moved, as well as at all entrances and exits.
4. The Bureau of Cannabis Control:
Finally, the BCC is responsible for regulating commercial cannabis licenses. This includes licenses for retailers, distributors, testing labs, micro-businesses, cannabis event permits.
How to Apply for a Cannabis Dispensary License
You can apply for a cannabis license in California here. You will also need to apply for a cannabis retail license in your local city, and requirements vary from city to city. There are two types of cannabis retailer licenses in California.
Type 9 is a “non-storefront” retailer is for cannabis delivery businesses. This license is also required to have a corresponding licensed facility but is not open to the public.
The Type 10 Cannabis Retailers License allows businesses to open a cannabis dispensary to the public in California.
California dispensaries are required to pay a $5,000 bond to the State of California, must be at least 600 feet away from schools, and can only deliver or sell cannabis from 6 am-10 pm.
What Do I Need to Apply for a Dispensary License in CA?
If you want to open a cannabis dispensary in California, you’ll need to apply for a Cannabis Retail License from the Bureau of Cannabis Control.
The requirements for this license include:
1. Business & Operations Plan:
This is an overall summary of your business plan. Keep it concise, but cover all major points. You should also make sure that it is well written and engaging so that readers are interested in learning more about your company.
Although you want this section to be first, it’s easiest to write this last after you’ve already worked out all of the details in your plan.
2. Financial Plan:
Discuss who you are and what your company goals are. You’ll also want to detail the legal structure of your business, the history of your company, and a summary of your growth.
3. Inventory Control Plan:
This is the section where your product gets the spotlight. Talk about what your product is and explain how it benefits the customer. You’ll also want to include information about your suppliers, costs, expected revenue, and any copyright data. Include pictures or diagrams to help your reader get a better visual understanding. You should also discuss what makes your product different and more desirable than your competition.
4. Patient Education Plan:
In order to operate a legal cannabis company, you’ll need to prove that you can pass compliance and facility regulations. This section will include details about facilities, technology, security, distribution, personnel, and more.
5. Market Analysis:
This is where you show off your knowledge of the industry. Discuss current research related to your cannabis product, your target demographic, and all past, present, and future marketing data for your product.
6. Patient Recordkeeping Plan
Now we’re getting into the nitty-gritty. Summarize your marketing strategy and plan for implementing sales. Detail how your product will be sourced and made, who you will employ for various jobs, how you will market your product, and how customers will find and purchase it.
Include a detailed timeline with thought-out goals and milestones.
7. Dispensary Security Plan:
This is where you show off your knowledge of the industry. Discuss current research related to your cannabis product, your target demographic, and all past, present, and future marketing data for your product.
8. Staffing Plan:
This shows your company has the correct personnel to successfully run a compliant cannabis business.
How Much Does it Cost to Open a Dispensary in California?
In California, dispensary owners are required to pay a $1,000 license application fee and then once approved you’ll pay anywhere from $5,000-$150,000 for the actual licensing fee. This fee will depend on the size and revenue of your operation. On top of the license, there are plenty of other costs to keep in mind.
California Dispensary Costs to Keep in Mind
Real estate
Professional services
Staffing
Business Equipment
Security & Surveillance
Marketing/Advertising
Misc. Product Costs
Summary
The hard truth is, though, that even once your cannabis dispensary is licensed and up and running it isn’t going to go anywhere without advertising and marketing.
That’s where Stoned Root comes in. We provide professional digital marketing solutions for the cannabis industry. We help cannabis brands grow by crafting custom SEO-rich content marketing.
Stoned Root can get your social media, website, and digital marketing off the ground and set up for success from start to finish.
Click here to learn more about Stoned Root digital marketing solutions for the cannabis industry.
Thanks for reading! Be sure to check out our blog for more articles on how to get your cannabis business up and running today!
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