Time flies – and fast. It’s hard to believe that less than 10 years ago, marijuana was illegal throughout the United States. Then, in 2014, Colorado was the first to pass recreational pot laws, with Washington State and seven others not far behind. In addition, a number of states have made medical marijuana legal.
Maybe you’ve personally seen how much pot can do for people who are in pain. Maybe they suffer from intense physical pain, mental health issues, or PTSD, and marijuana is the only thing that helps. Regardless if this is your reasoning or there are others, you’ve always wanted to go into business, and opening a dispensary seems right up your alley.
This article will discuss what you need to know to open a dispensary. You can’t just open your doors overnight! You need to do your homework, for both owning a business and the particulars of the marijuana business itself. Read to find out more!
Questions to Ask Yourself Before You Begin
Before you look into owning a dispensary, you need to know what it takes to own any business. You can’t just buy a storefront and open. It takes substantial thought, quite a bit of education, and the right type of attitude to make it work.
There are six questions every entrepreneur should ask themselves. These questions will help you decide if you are ready to pursue a business venture before investing much time or money. These questions will help you look at the whole picture. And what if you can’t answer these questions right away? It’s okay. You can enlist the help of a mentor or network with other entrepreneurs to find your answers. Examples of these questions include the following:
- Why am I starting a business?
- What sacrifices am I willing to make for a business to work?
- What problem will my business solve?
About Being an Entrepreneur
There is also a lot of terminology that goes along with entrepreneurship that you need to be familiar with. Just like any business niche, you need to know the lingo. For example, what is an “elevator pitch?” By going through these resources, you will learn that an “elevator pitch” is a synopsis of your business that you can give in the amount of time it would take you to ride an elevator.
There’s so much an entrepreneur needs to know:
- Why does credit matter?
- How do I manage my money?
- What about planning for the future?
There are also many entrepreneurial questions to ask yourself:
- How do I create a business plan?
- What must I have in place before I start a business?
- How do I protect myself from a lawsuit once the business is up and going?
Once you know the answers to these questions, you will be ready to move forward.
Know the Law
One thing you need to be aware of when it comes to opening a dispensary is what the law is in your state. As of right now, 9 states are completely marijuana-friendly, 24 states allow for medical marijuana, and 3 states are completely non-friendly to marijuana. Where does your state fit in? There are two requirements in all states to dispense cannabis: you need a clean criminal record and have residency in the state you intend to open in
One thing that you have to keep in mind is that, at the Federal level, marijuana is completely illegal. It is classified as a Schedule 1 Narcotic. This means that it has the potential of being abused and cannot be prescribed, only suggested. It is important to get an attorney who knows the laws in your state involved so you can stay safe.
Financing and Licensure
Another challenge dispensary owners have had involves acquiring start-up money and where to secure the money you earn. Because pot is illegal at the federal level, most traditional means of exchanging money are closed. Banks and other financial institutions won’t even allow dispensary owners to open accounts. Entrepreneurs needing financial backing must go through private lenders whose requirements are often hard to meet. This has meant that dispensary owners have to put their entire savings on the line to make it work. This is definitely not a business to get into if you hoped to get rich quick.
You also need to obtain a license to open. Every state has its own rules. In Colorado, it has been relatively easy to acquire a license, while in Utah, only 10 licenses were allowed in the entire state. There’s a chance that, even with the financial backing and following all of the rules, you may still not be able to open a dispensary. Find out before you invest a lot of time and money into the project.
Your First Day
The day has finally arrived. Don’t expect customers to break down the door or for you to make six figures on Day #1. Here are some things to expect:
- Unless you’re the first dispensary in the area, don’t expect immediate business. Referrals will help you get local business. Get friendly with doctors and others who may introduce your shop.
- Many of your first customers will be new to buying supplies legally. Make sure you are trained to make their experience pleasant by having the right attitude, knowing the answers to their questions, and using the appropriate terminology so your customers feel comfortable.
- For customers used to buying their medicine on the streets, your prices are likely higher. Explain the testing involved with your product to make sure it is completely safe, and also the taxes they are having to pay that didn’t exist before.
Opening a dispensary can be a rewarding experience. You are helping people who have not had any luck with traditional medicines or who prefer a more “natural way” of feeling better. Opening such a business is not without its hurdles, however, and you aren’t likely to get rich right away. Despite the hurdles, opening a dispensary can be very rewarding…if you just go about it the right way.