A cannabis dispensary business plan is a well-written document that explains in detail the objectives of the cannabis business and how the business intends to meet those objectives, taking into account every resource that will be needed and where it will be sourced from.
A cannabis dispensary business plan helps to keep a cannabis business on track to meet its objectives. The business plan ensures that all business resources are channeled toward meeting the set goals of the business towards growth and prosperity.
Cannabis dispensaries need to have a business plan for several reasons including:
- Define the nature of their business
- Define and target their potential clientele
- Determine financial and other resource needs
- Attract investors
- Plan for growth
Business Types for a Cannabis Dispensary
Before you start a cannabis dispensary, you need to determine the nature of ownership that will work best for you. You can either choose to go solo or to involve other parties. As you will see below, each option has its pros and cons.
In short, this is going solo where you shoulder every risk and take all the benefits when they come. The business is registered under your name and should there be any liabilities or losses, you are solely responsible for them. On the other hand, you are at liberty to make your own decisions, and when the business makes profits they all belong to you.
In this case, you have two or more business partners. There are two different kinds of business partnerships: limited partnerships (LP) and limited liability partnerships (LLP).
In limited partnerships, one person has unlimited liability and hence has majority control over the business. The other partners have limited liability and their control over the company is also limited.
In limited liability partnerships, all the partners have limited liability over the company. This model protects the business owners in case of debts and other liabilities that may be incurred by other partners or the business.
Once you have decided on the type of business that you want to operate, you will need to go out there and find funding for your cannabis dispensary.
Sources of Funding for the Cannabis Industry
Cannabis is a highly regulated industry, this is mostly because marijuana is under Schedule 1. Consequently, getting funding from traditional financial institutions is not as straightforward as it should otherwise be. This has prompted most business owners to rely on personal savings and donations from well-wishers to finance their cannabis businesses.
Other funding options for a cannabis dispensary include:
- Angel investors
- Venture capitalists
- Cannabis-specific investment groups
- Capital brokers
Defining Your Product Range
You will need to define the nature of the products that you will sell at the dispensary. This should be inspired by the needs of your target clientele as well as the unique selling point of your business. Don’t make the product range too broad so that customers can’t tell exactly what you are offering. But also, don’t make it too limited that customers have nothing to choose from. Here are some cannabis products to consider:
When choosing a location for your dispensary, you have to consider the state, county, and city zoning laws. These laws dictate how close a dispensary can be to daycare, schools, playgrounds, and addiction centers and even how many dispensaries can be in one city.
Apart from the zoning laws, you will also need to consider the demographics of the area, proximity to resources, and most importantly, security in the area.
States that Allow Cannabis Dispensaries
|Alaska||You can apply for an Alaska Marijuana Establishment License which can be used to open both a medical and recreational dispensary.|
|Arizona||The state accepts medical dispensary registration applications periodically.|
|Arkansas||The state accepts medical dispensary registration applications periodically.|
|California||You can get a state license to run a medical and recreational dispensary|
|Colorado||You can get a state license to run a medical and recreational dispensary|
|Connecticut||It is hard to get a medical dispensary license; a limited number are awarded at a time.|
|Delaware||You can’t get a dispensary license|
|Florida||You can’t get a dispensary license|
|Hawaii||So far only 8 dispensary licenses have been issued|
|Illinois||Applications are closed so you can’t get a dispensary license|
|Louisiana||You can’t get a dispensary license|
|Maine||Dispensary licenses are rarely available|
|Maryland||You can get a medical dispensary license|
|Massachusetts||The state accepts medical and recreational dispensary applications|
|Michigan||You can get a medical dispensary license|
|Minnesota||You can’t get a dispensary license|
|Montana||Dispensary licenses are available periodically.|
|Nevada||You can’t get a dispensary license|
|New Hampshire||You can’t get a dispensary license|
|New Jersey||You can’t get a dispensary license|
|New Mexico||You can’t get a dispensary license|
|New York||You can’t get a dispensary license; this is limited to registered organizations|
|North Dakota||You can’t get a dispensary license; the application is currently closed.|
|Ohio||You can get a dispensary license|
|Oregon||The state accepts medical and recreational dispensary applications|
|Rhode Island||Applications are accepted only during an open application period that is announced periodically.|
|Vermont||Applications are accepted periodically.|
|Washington||Cannabis dispensary licenses are currently not being accepted currently|
|Washington D.C.||Cannabis dispensary licenses are currently not being accepted currently|
FAQ: How to Write A Perfect Business Plan
A1. The key components of writing a successful cannabis dispensary business plan include a clear mission statement, a comprehensive market analysis, an accurate financial forecast, a detailed operational plan, and a clear exit strategy.
A2. The financial forecast should include a detailed breakdown of estimated revenue and expenses, a projection of cash flow, an analysis of capital needs, and an assessment of potential risks.
A3. To accurately gauge the size and potential of the market, market research should be conducted to understand the industry landscape and regional demographics, review local regulations and laws, and develop a competitive analysis of existing dispensaries.
A4. Having a well-crafted business plan can help secure funding, provide investors with confidence in the business model, and provide a roadmap for success. A well-crafted business plan can also help to generate interest in the business and encourage potential customers to purchase products.
A well-drafted business plan is essential for the success of any business, including a cannabis dispensary. If you cannot write one yourself, it is advisable to engage the assistance of a professional who can articulate your vision and objectives into a business plan. To wrap this up, here are seven tips to bear in mind when writing the perfect business plan for your cannabis dispensary:
- Be concise but thorough
- Use simple language
- Use bars, charts, and other pictorials
- Provide supportive documents are reference all data
- Research extensively and be objective
- Set realistic objectives
- Add a personal touch