Cannabis businesses continue to evolve as more and more states are passing laws allowing the sale of marijuana products. Legislators and constituents in each state have different concerns about how to implement their marijuana programs. For many states, part of this legislation entails providing cannabis business owners equal opportunity and widespread social equity. State governments have used microbusiness licensing as one strategy to enhance prospects for small businesses.
Even though several states have included microbusiness provisions in their cannabis-related legislation, very few have actually granted dispensary businesses microbusiness licenses. Yet, as additional states and companies are established nationwide, the micro business category is anticipated to grow and expand.
The legalization of recreational marijuana in Missouri in November 2022 opened the door for additional businesses to enter the state’s marijuana market. However, who will profit from the new market? These are some facts concerning the licensing procedure.
Who Can Get The Micro Business License First?
The first shot to apply for a license to sell, grow, and distribute marijuana in Missouri will go to those who have medical marijuana licenses. Medical marijuana license holders began applying for these licenses on December 8, 2022, and they are known as comprehensive licenses.
The first applicants for a comprehensive license will be those who currently hold one of the 63 marijuana cultivation licenses, 204 dispensary licenses, or 84 manufacturing licenses granted under the medicinal marijuana program. it is anticipated that as early as February 2023, those companies might start selling recreational marijuana after receiving their licenses. In addition, the amendment will establish a microbusiness license scheme for smaller businesses and new marijuana entrepreneurs.
Beginning in June 2023, applications for those microbusiness licenses will be accepted by the Missouri Department of Health and Senior Services.
What Is A Marijuana Micro Business?
The adult-use marijuana industry is eligible for the new cannabis business license known as a Marijuana Microbusiness License. A facility that grows cannabis on less than 10,000 square feet and serves as a licensed distributor, Level 1 manufacturer and cannabis retailer is referred to as a cannabis micro business.
A marijuana microbusiness License permits the business to:
- Cultivate up to 150 plants;
- Use those plants to process and create marijuana-infused products.
- Sell marijuana and products infused with marijuana produced by the microbusiness to people aged 21 and older.
The microbusiness is, in other words, a small-scale, vertically-integrated facility. For existing medical providers who are interested in making the transition to the commercial arena, micro business offers a unique and interesting possibility.
What Are The Limitations Of A Micro Business License
When contemplating licensing, potential investors and business owners should be aware of the limitations of the marijuana microbusiness license.
These restrictions could consist of:
- Microbusiness license holders are prohibited from owning or holding a stake in another adult-use marijuana business.
- Such businesses are prohibited from selling marijuana products to other licensed marijuana businesses.
- They are prohibited from buying marijuana or products infused with marijuana from any other licensed marijuana business.
In other words, microbusinesses are only able to generate revenue from the products they manufacture and offer for sale at retail at their location. So, it is beneficial for micro businesses to operate in areas where marijuana is not currently available for retail use.
Can You Apply For A Micro Business In Missouri License Now?
Not right away. The agency will begin accepting applications for microbusiness licenses no later than September 4, 2023, and could make those applications available as early as June 2023.
Missouri Cannabis License Market Overview
Missouri permits multiple licenses per owner or company of non-publicly traded entities with the option of vertical integration. The Missouri cannabis market is only getting started, with an emphasis on growing adult usage and the entry of several large MSO operators via M&A.
The Missouri Department of Health and Senior Services (DHSS) is in charge of issuing medical cannabis licenses to eligible patients and other establishments associated with the industry.
Microbusiness License Regulations & Requirements
Although applying for a micro-license may seem like a straightforward way to launch a cannabis business, it is still a costly and time-consuming process that comes with ownership, size, and operational restrictions that are not imposed on other license types. The state and the local licensing committee must approve a set of rules and regulations before a micro license for cannabis business production may be obtained.
One of the most important criteria for acquiring a micro business license is the operating space. State-by-state differences in facility regulations can be observed, however, operational spaces are often capped to a certain number of workers.
In addition to physical space requirements, a cannabis microbusiness encounters other restrictions on its monthly production volume. Some states impose monthly caps of 1,000 cannabis plants or 1,000 pounds of usable cannabis, which often include infused products and concentrates. The local licensing committee should be consulted to obtain the latest and most accurate information regarding all of these numbers because they vary depending on the location.
The key to operating a marijuana microbusiness license is to create an effective facility and production facility that takes into account the restrictions and limitations that have been imposed while making use of the allowances provided to micro business license operators. It’s crucial to adhere to operational and production volume constraints. Producing too much or breaching space restrictions might result in a fine or, worse yet, the loss of your license, which inhibits business growth and potential.
Even if the microbusiness model isn’t perfect, it’s a good place to start and has a lot of potential to promote social equity and the growth of the craft cannabis industry. That seems like a definite gain given the rising interest in hiring and buying locally. Instead of concluding that the microbusiness model is unsustainable or too difficult, let’s continue to assess, comprehend, and support what is working while improving what isn’t.
The cannabis micro business model is a positive, though flawed, step towards a more accessible and fair cannabis economy since it allows owners and operators who would otherwise be excluded to enter the industry.