Starting a cannabis business requires tons of hard work, the long and tedious process of applying for a cannabis license application makes it even more stressful. With constantly changing regulations, license requirements, and a brand new set of tax guidelines, adhering to permit protocols isn’t as easy as you think. Therefore, the license application process can be confusing, especially if you’re a newcomer. Luckily, knowing licensing requirements and operational laws can give you an edge over others and help strengthen your chances of securing a license.
To help you get started, we’ll discuss some key steps that you can consider to prepare a cannabis business license application.
Types of Cannabis Licenses
Cannabis regulations and provisions vary from state to state depending upon their license type. Normally, there are four types of cannabis licenses that you can acquire to be part of the exciting cannabis industry.
- Testing Lab
Each license has distinct laws, regulations & provisions which means you need a separate license to run any specific type of cannabis business. Therefore, firstly, you need to choose a license type that you are interested in.
Stay Prepared & Updated
The cannabis industry has ever-changing laws and regulations. Without having a solid business plan, there are very fewer chances of obtaining a cannabis license. To ensure you’re going on the right track, do some research on your state cannabis laws & regulations, license application requirements, and applicants’ eligibility requirements. Dispensary owners need to get a good command of state and local regulations and restrictions that can be a barrier in their cannabis license application process.
Your research should have the answer to the following questions to be sure you’re ready to jump into this competitive industry and have a pretty strong chance of survival.
Here are some questions to consider at this early stage:
- What are the eligibility requirements for a cannabis license?
- What are the state, federal, and local cannabis regulations?
- What is your timeline for the cannabis license application process?
- What are the local tax rates and their implications for your business?
- How to fund your business?
- Do you need a business partner?
- Do your business partners meet cannabis license application requirements?
- Do you have a perfect store location for your business?
Develop A Business Plan
To obtain a cannabis retail license, entrepreneurs need to have a reliable and strong business plan and funding. It is a perfect way to lay out how to plan to handle your business and its operations. Your business plan should be well-written and also contain a blueprint of your business like how to operate your store today and in upcoming years.
Develop A Operational Plan
Just like any other business, cannabis business also needs a well-developed operational plan to run a dispensary orderly. Therefore, you need to create an effective procedure on how to handle recordkeeping, security, distribution, shipping, and payment processing. Moreover, most states explicitly ask for Standard Operating Procedures (SOPs) along with your license application.
Find A Suitable Location
Looking out for a perfect property is an essential step that can’t be skipped. A perfect location is not only a law requirement and also an operational need in order to get a cannabis license. Many states need their applicants to already secure suitable real estate for their businesses. In a nutshell, a suitable location is a part of your license screening process that needs to be approved by your landlord or owner (if you don’t own a property).
You can consider the option of leasing, renting, or buying a property. However, ensure your locations have a good distance from schools, public parks, public libraries, residential areas, and spiritual areas.
Key pointers that need to keep in mind while choosing your location:
- Are your neighbors cannabis-friendly?
- What is your proximity to other cannabis competitors?
- Which compliant properties are best suited?
Manage your Funds
Business has a simple rule: you can’t run a business without funds. Just like any other sector, the cannabis market also requires a sizable amount of money to get on board with your license process. Entrepreneurs need to have some money to handle licensing and application fees. Normally, the fee varies from jurisdiction to jurisdiction depending upon the type of license you’re acquiring.
Entrepreneurs need to have a proper plan on how to manage the store until their business starts generating revenue and profits. Many states explicitly ask for significant annual payments in the license screening process.
Obtaining a cannabis business license is a complex and time-consuming process, but with a lot of hard work, paperwork, and staying updated with legal regulations, entrepreneurs can have strong chances of securing a cannabis license. If you’re still not sure or confused about the cannabis license application, then you may seek professional help. A skilled expert can do all the needed work for you and guide you on the right track that can help your business grow.