Medical cannabis is here to stay. That much is clear. It is also clear that there is no shortage of entrepreneurs willing to establish cannabis businesses ranging from growing operations to retail dispensaries. The dispensary, also known as the medical cannabis pharmacy, is the endpoint for users. It is where they buy their medical cannabis products.
Dispensaries and pharmacies are essentially retail operations. However, don’t assume that setting up a new pharmacy is an easy proposition. It’s not. Just ask the people behind Deseret Wellness in Provo, Utah. They operate two locations. They can tell you that building a successful business takes hard work and resources.
According to Deseret Wellness, here is what you need to open a brand-new facility from scratch:
1. A Solid Business Plan
The first step in starting any business is putting together a solid business plan. A business plan outlines what you intend to do, how you intend to do it, and how it all translates into profit. Note that there is no black-and-white format. Your business plan can take any form. Just make sure it clearly explains your intentions, goals, and vision. The more information you include, the easier it will be to raise money.
2. A License
First and foremost, you will need a license. The states regulate dispensaries and pharmacies just like they do any other kind of business. You might even say that medical cannabis is more tightly regulated due to its very nature. At any rate, you will need a pharmacy or dispensary license before you can do anything else. Be prepared to pay at least a few thousand dollars for it.
3. Sound Financial Resources
Starting any kind of business from scratch requires money. Opening a medical cannabis pharmacy is no exception. In addition to paying for a license, you will need enough financial resources to pay for a facility, hire staff, buy product, and pay for marketing. You also need to cover all of those incidentals – things like office supplies and utilities.
4. A Physical Premises
You cannot run a medical cannabis pharmacy from a street corner. You cannot simply find a vacant lot and set up a card table. You need to have a physical premises that includes a safe and occupiable building. If you choose to rent, plan on signing a multi-year lease. Most commercial leases are for either two or three years. If you are planning to buy a facility, you’ll need enough money to make a good down payment.
5. A Good Team
Next, you’ll need a good management team capable of helping you make a go of it. It’s best to work with people who have at least some experience with startups. Any that have additional experience in the medical cannabis field are a bonus. It also helps to have at least one or two team members with experience in dealing with state government. There will be a lot of that in the months and years to follow.
6. Reliable Partners
Finally, you are going to need reliable partners capable of supplying you with product. Depending on the state you’re operating in, you may be limited in the number of processors feeding the local market with products. Most states tend to limit processors by making only a certain number of licenses available.
There is money to be made in medical cannabis. One way to do it is to open a pharmacy or dispensary. But as with any business, operating a pharmacy or dispensary requires hard work and plenty of resources. Don’t go into it expecting it to be a road to quick riches.
