Before we get started with our guide on how to open a dispensary in Montana, let’s take a look at the viability and opportunities of the cannabis market in the state. No point in opening a store in Montana if it’s too hard or won’t make you any money, right?
The good news: cannabis is legal in Montana, it’s relatively easy to start a dispensary there, and the market has lots of potential. So, let’s dive in.
The Cannabis Market in Montana
With a population of 1 million people (out of which 70% are above 21) to cater to, Montana presents a rather lucrative option for opening a weed dispensary.
Sales of medical marijuana in Montana in 2019 were estimated to be between $66 million and $80 million by the Marijuana Business Daily. The same publication estimated that the MMJ market would expand to $155 million by 2024 without factoring in recreational legalization.
A fiscal analysis of the recreational cannabis ballot initiative by the state budget office, based on data from other states and Montana’s adult population, estimated that recreational cannabis would bring in about $90 million in the first full year of sales (2023, with 2022 being incomplete due to incomplete data from the other states in the analysis).
A more optimistic University of Montana study, meanwhile, projected that recreational sales would bring in $217.2 million in the first year and $234 million by 2024.
How Much Cannabis Can You Own In Montana?
- Registered medical marijuana patients and adult-use consumers can purchase and possess up to one ounce of marijuana flower or its equivalents.
- Medical patients can buy up to 5 ounces monthly, with a daily limit of one ounce.
- Recreational users can grow up to two mature plants and two seedlings privately, while medical cardholders can grow up to four mature plants and four seedlings.
- Recreational cannabis products are sold based on THC concentration.
- There are purchase limits for various marijuana products, including flowers, capsules, tinctures, edibles, topical products, suppositories, and transdermal patches.
- Registered cardholders can purchase or possess any combination of marijuana flower, marijuana-infused products, and marijuana concentrate, provided the total calculated conversion does not exceed the legal purchase or possession amount.
Types of Licenses Available in Montana
- Marijuana Manufacturer License – General Provisions/Chemical Manufacturing/Infused Products/Mechanical Manufacturing
- Marijuana Cultivator License
- Marijuana Dispensary License
- Transportation of marijuana and marijuana products/Marijuana Transporter License
- Combined Use Licenses
- Marijuana Testing Laboratories Licenses
- Marijuana storage facility endorsement
Dispensary Laws in Montana
- The Montana Department of Revenue oversees the licensing of medical marijuana providers and dispensaries.
- Medical dispensaries established prior to November 2020 can apply for a recreational license if they meet the state’s requirements.
- A dispensary license carries a fee of $5,000 per location.
- Dispensaries must be situated at least 500 feet away from places of worship, schools, and post-secondary educational institutions.
Licensing Requirements for Cannabis Dispensaries in Montana
Dispensaries are places where marijuana can be sold to registered medical marijuana patients and/or adult-use consumers. Dispensaries are licensed for either medical-only or adult-use sales. Medical-only dispensaries sell exclusively to registered cardholders, while adult-use dispensaries can sell to both registered cardholders and adult-use consumers.
Dispensary Licensing Requirements
General Licensee Requirements apply to dispensaries in addition to the specific requirements listed.
- New dispensary license applications open on 7/1/2025.
- Existing businesses can apply for additional dispensary locations.
- Businesses can hold multiple licenses (Cultivator, Manufacturer, Dispensary, Transporter), but it’s not mandatory.
- Dispensaries can purchase marijuana from other licensed businesses.
- The seed-to-sale tracking system must record all sales to registered cardholders or adult-use consumers.
- All employees need a valid Worker Permit before starting work.
Security and compliance go hand in hand when setting up a dispensary. Along with the abovementioned requirements, having a security and compliance plan will be of great help. Don’t know where to start? Build a successful retail business with Cure8’s dispensary security solutions in Montana.
Additional Application Requirements
- Must meet all General License Application Requirements
- Applications must be submitted via the TransAction Portal (TAP).
- Marijuana business applicants must operate in jurisdictions compliant with 16-12-301, MCA.
- Each dispensary location requires a separate application.
Fees
- The dispensary license fee is $5,000 per location.
- Applications require a processing fee of 20% of the license fees ($1,000).
- Application processing fees are non-refundable.
Additional Costs To Be Incurred By The Applicant
- The department won’t process applications until all processing fees are received. The remaining 80% of the license fee is due upon approval or renewal notification.
- Initial and renewal worker permits cost $50, while replacement permits cost $10.
- Initial and renewal registry identification cards cost $20, and replacement cards cost $10.
- Background checks cost $30 each, separate from the processing fee.
- Changing a licensed premises location costs $2,500.
Which Documents are Required To Apply for a Dispensary License in Montana
- Applicants must be Montana residents.
- Applications must use department-provided forms.
- Licenses expire annually, except for transporter licenses (two years).
- Renewal applications must be submitted 60 days before expiration.
- The department has 120 days to approve or deny new applications, and 60 days for renewals. Applications are complete when all required documents and fees are submitted.
- Late renewal applications may lead to operational suspension.
- The department may request additional information before approval.
- Premises inspections are conducted before issuing licenses.
- Failure to submit a renewal application may result in operational cessation.
- Late renewal applications will not be considered, leading to license lapse.
- The department won’t extend a license’s expiration date unless the licensee proves that late renewal was due to uncontrollable circumstances.
- A licensee cannot operate before the effective date of their license.
Background Verification Process in Montana
- A fingerprint background check by the Montana Department of Justice and Federal Bureau of Investigation is required for all individuals listed on the application and for parents or guardians of minor providers.
- Two fingerprint cards must be completed by a trained individual at a certified fingerprinting agency and submitted to the department.
- Background check results must be received before any application is approved.
Cannabis Taxation in Montana
- State taxes on medical marijuana are 4%, while adult-use sales are taxed at 20%.
- Counties may also impose a local marijuana excise tax of up to 3%.
Licensed Premises – Security Requirements
- Licensees must have a written security plan to prevent theft, diversion, or tampering of marijuana on the premises and during transit.
- The plan must restrict access to marijuana areas, identify authorized persons, and provide electronic monitoring.
- Licensed premises should have only one secure entrance for public access.
- A security alarm system must be installed on all perimeter entry points and windows.
- A video monitoring system with cameras should record images with clear date and time display, continuously 24/7 or on motion sensor, at 10 frames per second, and be placed for optimal identification and recording of all entrances and exits.
- The video monitoring system must keep recordings for at least 60 days.
- Monitoring system videos are subject to inspection and copying by the department upon request.
Seed-to-sale Tracking Systems Requirements in Montana
- Licensees must have an active seed-to-sale tracking system account before operating.
- Additional licensees or employees can be authorized to use the system.
- Users must complete the required seed-to-sale tracking system training.
- Individuals can only use their own seed-to-sale tracking system account.
- Licensees must ensure users are up-to-date on training and correct any data entry errors.
- Licensees and designated users must enter data into the system for all seed-to-sale tracking activities.
- Licensees are accountable for actions taken by seed-to-sale tracking system users.
- Licensees are responsible for the accuracy of information entered into the system.
- This rule doesn’t prohibit the use of secondary software applications for collecting business information.
- If a separate software application links to the seed-to-sale tracking system, it must get approval from the vendor and accurately transfer data between systems while preserving the original seed-to-sale tracking system data.
- If a licensee loses access to the seed-to-sale tracking system, they must keep records of all inventory activities during the outage.
- Once access is restored, all activities that occurred during the outage must be entered into the system.
- Licensees must document when access was lost and restored.
- All compliance notifications from the seed-to-sale tracking system must be addressed promptly.
What Are The Cannabis Dispensary Labeling Laws in Montana?
- Cannabis labels must include strain name, common name, dispensary/cultivator/manufacturer details, unique ID, harvest/manufacture date, net quantity, compliance statement, QR code linking to analysis, universal symbol, and warnings.
- Marijuana labels cannot contain false or misleading information.
- Manufactured marijuana products must indicate the manufacturing method and solvent used.
- Marijuana products for sale must be packaged in child-resistant containers.
Cannabis Inspections in Montana
For New Licenses
Compliance specialists review applications, checking local jurisdiction requirements, property information, and business entity details. If any information is incorrect, the application is rejected.
Inspectors schedule pre-licensing inspections at the proposed location. The site must be fully operational-ready, including equipment, signage, and necessary items.
To pass the inspection, the location must have all required documentation, signs, standard operating procedures, and adequate cultivation space.
Post-Inspection Process in Montana
After the inspection, the provider will receive a statement of deficiencies from the inspector.
- The provider must respond to the deficiencies on a deficiency report response form and submit it via the TransAction Portal (TAP) within 10 days. If no response is received within 10 days, the department will assume the deficiencies have not been corrected.
- Each response must be uploaded in the TAP and given a unique name for easy identification by the Inspector Supervisors.
- The licensee will receive a final post-inspection report, even if no deficiencies were found or corrective action was required.
After receiving the written response, the inspector will review it to ensure it complies with the statute.
- If photo evidence verifies the corrections:
- The department will respond within 10 days with approval or denial.
- If approved, the license or application will proceed.
- If not approved, the license will not proceed until compliance is met.
- If photo evidence cannot verify the corrections:
- A follow-up inspection will be scheduled within 10 days.
- A written response will follow the inspection within 10 days, approving or denying correction.
- If approved, the license or application will proceed.
- If not approved, the license will not proceed until compliance is met.
How and When Can Your Cannabis Be Suspended And Revoked in Montana?
- The department can suspend a license for up to one year.
- The department will revoke licenses for offenses listed in 16-12-109(5) MCA and 16-12-202(9) MCA for marijuana testing laboratories. They may also revoke licenses for other marijuana law violations.
- When determining suspension length or revocation, the department considers aggravating and mitigating circumstances and the severity of the violation(s).
- License suspensions are effective at all licensed premises involved in the violation(s).
- During suspension, licensees and their employees cannot operate the suspended premises, sell, deliver, service, remove, transport, or receive marijuana or marijuana products. The department may negotiate terms to prevent marijuana loss.
- Suspended licensees must still comply with marijuana laws, including tax and reporting laws.
- Suspended licensed premises remain subject to inspection.
- If a license is due for renewal during a suspension, the licensee must submit a renewal application with fees to avoid license lapse. The department will not approve the renewal until the suspension ends.
- If a renewal application is received during a suspension, the time allowances in 16-12-104, MCA, won’t start for the suspended premises until the suspension ends.
- A suspension doesn’t change a license’s renewal date.
- The department will inspect all suspended licensed premises before the licensee can resume operations.
- After a license revocation, the department won’t accept applications from the person(s) qualified for licensure for three years. After three years, an application will only be accepted if the applicant demonstrates steps taken to prevent future violations.
How to Open a Dispensary in Montana
Now, let’s move on to how you can establish your weed dispensary in Montana.
Step 1: Establishing Your Business
Just like any other business you have to start by registering as an official business entity.
The Montana Small Business Development Center has a helpful guide on how to get set up as a legal business in the state. Steps include:
- Selecting a name, company structure, and registering with the state
- Applying for licenses with your local city and/or county, as needed
- Obtaining an Employer Identification Number (EIN) from the IRS
- Registering your trademarks and patents
If you don’t have any experience in starting or running a cannabis business, you should bring in someone that does know what they’re doing at this early stage so you get off on the right foot.
Search for experienced cannabis entrepreneurs, consultants, and employees. Look on Google, LinkedIn, Leafwire, Indeed, etc. or ask around. The Montana Cannabis Industry Association might be able to help you find people and make connections as well.
Step 2: Planning
Unlike some other states, Montana doesn’t really require you to put together a comprehensive business or operations plan as part as the application process. Still, it’s a good idea to do so, and having one will help you get the funding you need in step #3 and beyond.
Your business plan should include:
- Your business’s vision and mission
- Financial plan
- Product plan (including quality control and assurance)
- Operational plans (hours, job descriptions, # of employees, etc.)
- Security plan
- Compliance plan
- Marketing plan
Montana does require you to put together formal plans for 1) producing your marijuana and 2) protecting your products and your business before you start operating, so you might as well put those together at this point as well.
Step 3: Get Funding
Due to federal laws it can be difficult to get funding via traditional avenues like banks and mainstream investment firms. You can try your luck with investment firms that specialize in funding cannabis startups, or by asking family and friends.
The fact that you have to grow, process, package, and stock 50-100% of the products you sell at your dispensary will add to your upfront costs. You’ll have to get an entire seed-to-sale, vertically-integrated operation up and going from scratch.
At the same time, the Montana market isn’t dominated by big companies like other state markets are. Plus, the application process is pretty inexpensive and simple, and regulations aren’t as strict as in other states. So don’t get discourage if you don’t have huge cash reserves at the start, because you might not need it.
Step 4: Find a Home
Before you get a license you need to rent or buy a storefront, which needs to be approved by city authorities (and your landlord, if you have one).
The state of Montana dictates that these premises can’t be within 500 feet of any:
- Church, synagogue, mosque, or other place of worship
- School or postsecondary school, other than commercially operated schools
The state will inspect the property before approving your license.
Beyond that, just use your common sense when deciding where to locate your dispensary. Look for areas with the highest number of register medical marijuana patients and the least amount of existing dispensaries.
Step 5: Get a License or Two
Getting a dispensary license in Montana is pretty easy, at least compared to the process in more heavily regulated states. To get one you just have to:
- Submit fingerprints and a completed background check
- Provide proof of at least 3 years of state residency (example: 3 years of tax returns)
- If you’re renting your property, you need to provide proof of your landlord’s approval
- Register and submit a canopy application here
Once your Provider application is approved, you can then:
- Apply for a separate cultivation and dispensary licenses in the same portal
- Complete METRC Level 1 Training
All of your employees will need individual licenses as well.
Step 6: Setting Everything Up
Now that you’re street legal, it’s time to get set up. This is a little trickier for dispensaries in Montana since you have to get an entire seed-to-sale pipeline in place from the start. It may be at least a couple months before you’re ready to sell anything to the public.
If you’re new to the game, you’ll want to get help to set up your growing and processing operations to start with. Find someone experienced in cultivation, either a consultant or full-time employee.
Look for construction companies and interior designers to help with your store’s look and feel.
Step 7: Launch
Once ready, open your dispensary’s doors to customers!
Remember, Montana prohibits marketing marijuana products under the Montana Code 2019, Part 3, Section 50-46-341. You can have a website but no prices or active solicitation is permitted.
How Cure8 Can Help
Your friends at Cure8, an IT company with extensive experience in the cannabis industry and a proud NCIA and CCIA member, can help you with setting up your cultivation, processing, and retail operations. We can design, install, and manage all your tech for you, including POS stations, surveillance systems, seed-to-sale tracking systems, label and packaging systems, and back office networks.
Click here to read on 4 IT Services Every Cannabis Company Should Be Using