how to open a dispensary in new jersey

CURE8 BLOG

How to Open a Marijuana Dispensary in New Jersey

Dispensary Laws in New Jersey

Medical dispensaries

Medical marijuana has been legal in New Jersey since 2010, though heavily regulated. The Cannabis Regulatory Commission has expanded licenses for medical cannabis dispensaries significantly since the initial legalization. As of 2024, there are more than 30 medical dispensaries operating across the state, catering to New Jersey’s population of 9.3 million.

The state allowed for six total medical dispensaries in the initial 2010 legalization. It then took its sweet time in giving them out, only approving the sixth initial MMJ dispensary in 2017.

Another six were approved in 2018, and the expansion continued as more licenses were made available in 2019 and subsequent years.

In 2023, the Cannabis Regulatory Commission (CRC) began accepting new applications for medical dispensaries under revised guidelines that streamline the process and emphasize equity considerations.

Can I currently open a medical dispensary in New Jersey?

Yes, applications for medical dispensaries are currently open. The CRC has been accepting them since early 2023, and the process remains ongoing.

Meanwhile, starting April 2022, the state Cannabis Regulatory Commission has initiated issuing licenses to medical cannabis dispensary to sell recreational marijuana. Dispensaries will be officially known as alternative treatment centers, and only seven licenses will be issued.

Recreational Dispensaries

Recreational marijuana is now legal in New Jersey following a successful ballot initiative in November 2020.

As of 2024, there are over 20 recreational dispensaries operating across the state, located in major cities and regions, including Maplewood, Phillipsburg, and Bellmawr. The number of licensed recreational dispensaries continues to grow as more businesses meet regulatory requirements and receive approval.

New legislation passed in 2023 further expanded the number of cultivation licenses available, aiming to meet the increasing demand for both medical and recreational cannabis.

There are still many unknowns. The CRC has been actively releasing updated guidelines and requirements, including details on the application process, required documentation, and licensing quotas.

Can I currently open a recreational dispensary in New Jersey?

Yes, you can. The Cannabis Regulatory Commission has issued seven licenses to medical cannabis dispensaries to sell recreational marijuana. In 2024, the state opened additional opportunities for new applicants to directly apply for recreational dispensary licenses, aiming to increase access and competition in the market.

The Cannabis Market in New Jersey

One thing that’s for sure – there’s good money to be made in legal cannabis in New Jersey if you’re willing to overcome all the bureaucratic red tape and some stiff competition from established players.

New reports indicate that the cannabis market in New Jersey has been growing rapidly, with both medical and recreational dispensaries reporting substantial profits.

Other notable companies that you’ll be competing with include:

According to recent estimates, New Jersey’s adult-use market is projected to exceed $1 billion annually by 2025, surpassing states like Nevada and Oregon in revenue.

Even the state itself has recognized the need for more dispensaries, projecting that at least 100 new retail locations will be necessary to meet consumer demand as the market matures.

So unlike other markets, there’s no need to worry about oversaturation, especially when retail dispensaries are expected to attract lots of people from nearby states like New York and Pennsylvania.

Cannabis Taxation In New Jersey

As of 2024, the state has adjusted its tax policies for recreational cannabis sales, which includes a combination of excise and sales taxes. Retail sales of recreational cannabis and cannabis products are subject to Sales and Use Tax, which must be reported and remitted to the Division of Taxation by filing Form ST-50C on a quarterly basis. You can find more about the current Sales Tax rate of 6.625% here.

How to Open a Dispensary in New Jersey

Now that we’ve covered the basics, let’s get down to brass tacks about starting a marijuana dispensary in New Jersey. These instructions are based on the current regulations for both medical and recreational marijuana dispensaries, as the rules have been updated recently.

Step 1: Establish Your Business 

Cannabis businesses in New Jersey can now operate as either for-profit or non-profit entities, depending on their preference and business model. You will need to create or gather necessary documents, such as articles of incorporation and by-laws, and set up a board of directors and, if applicable, a medical advisory board.

This is also when you should consider bringing in your first, key directors and managers, preferably experienced in cannabis or at least retail, to help with building your company.

Step 2: Planning

Here, you put together a detailed business plan for your business. This should include:

  • Financing plan
  • Quality control and quality assurance plan
  • Dispensary/operations plan 
  • Labor compliance plan
  • Workforce and job creation plan
  • Security plan 
  • Environmental impact plan
  • Anything else you think would help you stand out and attract investors

As of 2024, the CRC requires applicants to demonstrate social equity initiatives and environmental sustainability practices in their business plans. Incorporating these elements can significantly improve the chances of license approval.

Step 3: Get Funding

To secure funding for your cannabis business, start with family and friends and with investment firms that specialize in funding cannabis companies, since most banks and mainstream investment firms won’t touch you with a ten-foot pole until federal legalization occurs.

Make sure to keep track of all your sources of funding. You’ll have to list any funding above a certain threshold in your application.

Additionally, New Jersey has launched several programs to support minority-owned, women-owned, and disabled-veteran-owned cannabis businesses, providing access to state-funded grants and loans aimed at promoting social equity in the industry.

Prioritizing reliable cannabis security solutions in New Jersey is crucial for meeting regulatory standards and building trust with both investors and customers in this competitive market.

How Much Does It Cost to Open a Dispensary in New Jersey?

Right now the only way to open a dispensary in the state would be to buy an existing MMJ dispensary. This would likely cost you at least several millions dollars.

On the bright side, New Jersey’s recreational law is designed to help smaller businesses get in to the market. It has provisions favoring microbusinesses of 10 employees or less. It also aims to provide a certain number of licenses to female, minority, and disabled veteran business owners, and to businesses in low income “impact zones”.

For microbusiness applicants, the state has set reduced licensing fees and expedited processing times to encourage smaller operations and increase diversity within the industry.

Step 4: Find a Home

Example of evidence of local support from Verano’s New Jersey dispensary application from 2018.

New Jersey requires you to have control of a property in an area approved for a marijuana dispensary ready before you apply for a license. You need to comply with local zoning laws and get proof of support from the city government where you’re locating your dispensary. This could be a copy of a city law or simply a letter of support from the mayor and/or city council.

Your dispensary needs to be a certain amount of distance away from locations like schools and day care centers. New Jersey has now implemented similar buffer zones between cannabis businesses, limiting proximity to one another and to sensitive locations like schools.

It’s not ideal to have to rent out a property before you can even start opening your business, and having to continue renting it out for months while government officials review your application, but that’s the way it is.

Step 5: Apply for a License

New Jersey now provides updated application forms and guidelines directly through the CRC’s website. These forms are regularly revised, so it’s crucial to review them closely and ensure all requirements are met.

Dispensary applications can run into the hundreds or even thousands of pages. You’ll be submitting a lot of the documents you created in the planning phase, plus additional info such as:

  • Articles of incorporation/by-laws
  • Approval from local municipality
  • Mockup of expected exterior appearance of dispensary

The application fee is $20,000, with $18,000 of that refundable if your application is rejected.

New guidelines also require applicants to demonstrate their commitment to community engagement, social equity, and environmental sustainability as part of the licensing process.

Step 6: Setting Everything Up

Now that you have your license, it’s time you start working on your store and the IT side of things. You’ll need a good construction company.

And of course, if you’re not a vertically-integrated company, you’ll have to find cultivators, manufacturers, or distributors that will provide you products to sell. Hopefully you’ll already have some connections with these companies, or you’ve hired an experienced cannabis buyer to manage this aspect of your business for you.

Tech is a critical aspect of your dispensary too, definitely not an area to cut corners on. Your POS – and therefore all your sales – requires fast and reliable hardware and software.

To comply with state regulations, dispensary owners must implement robust dispensary security solutions in New Jersey, including surveillance systems and secure access controls to safeguard their operations. The CRC mandates that all dispensaries maintain a comprehensive security system that includes live surveillance, secure storage for cannabis products, and digital records of inventory and sales. Non-compliance may result in license suspension or revocation.

For your IT you will need at least the following; 

  • A point of sale software
  • POS tablets or terminals
  • Receipt printers
  • Cash drawers
  • Barcode scanners
  • A network switch
  • Patch cables
  • Security cameras
  • An NVR
  • Racks
  • Wireless access point
  • UPS
  • Other back-office hardware and software

These are all links to our new cannabis e-commerce and IT services venture, Cure8, where you can find recommended, curated dispensary hardware, as well as request services including design, planning, installation, and management.

We recommend you rely on a partner like Cure8 to set up your IT for you. Your tech is your foundation – it’s better to get it right the first time and have it propel your growth, rather than do it haphazardly and have to redesign your IT at much larger scale and complexity later on.

Step 7: Launch

With everything good to go, it’s time you launch your store.

How to get the word out? Double-check New Jersey law to see what options you have. The latest regulations still include restrictions on outdoor advertising, such as limitations on illuminated signage and content guidelines, but digital marketing, social media, and community engagement events are now commonly utilized methods.

Otherwise it seems that most forms of advertising and marketing are open to you, including TV, radio, and print ads, flyers, trade shows, and PR/press coverage.

Can I Start a Cannabis Delivery Service in New Jersey Too?

Cannabis delivery services are now available to both medical and recreational license holders. Businesses interested in offering delivery services must apply for a delivery endorsement in addition to their retail license.

For recreational delivery services, companies must comply with specific security and operational guidelines provided by the CRC, which include vehicle tracking systems and secure product storage.

Need Help with Tech? Rely on Cure8

Cure8 is experienced at providing IT services to businesses in the cannabis industry. We’re proud members of the NCIA and CCIA, and we’re here to help you with everything from planning to installations to management of your POS, seed-to-sale system, networks, and security systems.

We’re here to help you both with long-term planning and scaling of your dispensary, as well as swift resolution of issues such as POS and network outages and security breaches.

Otherwise best of luck with your new dispensary!

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