How to open a cannabis dispensary in Michigan – a question that’s on every cannabis entrepreneur’s mind.
The industry is getting a lot of attention for its impressive growth in such a short amount of time.
This one year old industry has annual cannabis-related sales estimated at $730 million to $875 million only in 2020, and the estimations for the following years don’t disappoint either.
To get a marijuana business set up in Michigan, you’ll need to be aware of the laws and how to get licensed. If you want to learn how to open a Marijuana Provision Center in Michigan or apply for any adult use marijuana grower, processor, or transporter licenses, here is all the information you need.
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What types of License can i get to open a Dispensary in Michigan:
- For a medical marijuana dispensary you should apply for a Provisioning Center License that authorizes the sale of marijuana to a registered qualifying patient or registered primary caregiver.
- For an adult-use marijuana retail store you should apply for a retailer license that allows you to sell marijuana and other marijuana products, including plants and seedlings. You should know that for the first two years, the state of Michigan will only accept recreational cannabis retail license applications from those who hold a state operating medical marihuana facilities license
What is a Provisioning Center in Michigan?
A marijuana provisioning center is defined under Michigan law asa licensee that is a commercial entity that purchases marihuana from a grower or processor and sells, supplies, or provides marihuana to registered qualifying patients or registered primary caregivers. The term “provisioning center” includes any commercial property where marihuana is sold at retail to registered qualifying patients or registered primary caregivers
How to Open a Cannabis Dispensary in Michigan?
Make a Business Plan For Your Marijuana Dispensary in Michigan
A business plan for a marijuana dispensary requires knowledge about the right location and proper requirements at the place of operation.
In Michigan, the location is essential for the prosperity of your business since many local municipalities can choose to ban or limit the number of businesses.
Location requirements also prohibit cannabis operations located within an area zoned exclusively for residential use and not within 1,000 feet of a pre-existing public or private school providing education in kindergarten or any of grades 1 through 12, unless a municipality adopts an ordinance that reduces this distance requirement.
Remember, the cannabis company model you create, the investors you select and the partners you choose have an impact on your license approval, make sure it is a positive one.
Every person, from an investor to an employee, will be background checked throughout the process.
Also, during the process, you will need to submit a site plan that covers everything from the building layout to security to trash management, and you may need to lobby for approval.
Search for the Regulations
Since the adult use marijuana industry in Michigan is fairly new, requirements are still constantly changing. You want to make sure to have the assistance of an experienced licencing lawyer that helps you prevent unnecessary risks.
Also, many times there are, apart from the State’s laws, local regulations that you have to pay attention too. They could go from license application requirements, to the local-wide limit of accepted number of dispensaries in the zone.
Make sure you are well assisted by an experienced cannabis lawyer that takes into consideration all the possibilities and is well aware of the norms.
Get the Most Out of the Dispensary Business in Michigan
- Opening a cannabis dispensary in Michigan requires more than application forms. There are many market opportunities you have to research, take into consideration the zone you’ll be operating too.
- The creation of a business plan that leads you to profit and, eventually, success is essential to getting the most out of the dispensary business in any State, Michigan is certainly not the exception.
- Stay productive once you start your business. Keep the plan accurate to make your dispensary business more successful in the long run.
- Adapt. In an industry that is constantly changing, adapting quickly to take advantage of new opportunities and facing potential challenges that come with the territory will determine if you’ll have a successful business or not.
How Much Does It Cost to Open a Dispensary in Michigan
To get a provisioning center or retailer license in Michigan the application fee is $6.000. The actual license fees vary depending on the type of license. For retailers is $25.000 for new licences, while for provisioning centers is $44.000.
These costs are not related to compliance, build out, payroll, or any of the other start up costs for your dispensary (provisioning center) in Michigan. You should probably budget about $500,000 to be on the safe side. Watch out for real estate costs, which can really become the largest aspect of the provisioning center. Of course, oftentimes the real estate is held in a separate holding company but that does not mean you do not need that money. You just organize the transaction differently.
Operating costs vary. You should think about the unit location, area of jurisdiction in the current city, and standard operational expenses that apply to every dispensary.
What to Expect During the Application Process
There is a prequalification phase to fill out all the documents and submit them for consideration. Everyone involved in your business will have a background check during this phase. If your application passes the prequalification step, then you will enter the second phase
The second phase, or license qualification phase, requires more specific information for the specific licenses you are seeking.
Beware of Cannabis Taxes in Michigan
The state tax requirements in medical marijuana in Michigan is 6% sales and use tax. For recreational cannabis is 10% excise tax plus 6% sales tax. Watch out for additional taxes at the municipal level.
Don’t miss out on our Marijuana Legalization Map where you can browse the current status of laws in every state in the United States and see all our posts on each of them.
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