The year was 1849. A couple of minors in California struck gold. News of the ample gold in California traveled fast and within months, over 300,000 people with visions of great riches made their way to California. For several years, the new enterprise of gold mining in California made thousands of men wealthy.
Many parallels can be drawn between the California Gold Rush and the modern medical marijuana industry. The legalization of marijuana for medical purposes also began in California. In 1996, California voters approved the use of cannabis for medical purposes, and over the following 20 years, it became legal in 23 American states. In addition to the medical advancements that marijuana offers, medical marijuana is sometimes called “green gold,” for the opportunities it opens to make people involved in the somewhat new industry wealthy.
In the short time since its legalization, the marijuana industry is said to have grown into a $45 billion enterprise. Careers ranging from medical marijuana marketing, medical marijuana consulting, and even medical marijuana facility design have made people in this somewhat new industry rich. If you are interested in starting a medical marijuana business, you should be aware of some best practices to get it off the ground securely:
- Start with a lawyer. While running a medical marijuana facility is legal in 23 states, it is heavily regulated and you want to make sure you are abiding by all legal requirements to avoid hefty fines or being shut down altogether:
- Location. Some zoning requirements impact location and makeup of your medical marijuana facility design. You will need to be certain distance from any schools, residential areas, and shops that sell drug paraphernalia (such as bongs and pipes).
- Licensing. You will need a lawyer to help walk you through obtaining a business license for selling marijuana.
- Tax Implications. Your lawyer will also help you manage the reporting and tax implications of your business. Some states classify a medical marijuana facility as a nonprofit organization while some apply additional taxes to marijuana sales.
Since the laws vary so vastly from one state to the next, your lawyer will help you with the nitty gritty of the your state’s requirements.
- Consult a cannabis expert. Running a medical marijuana dispensary involves numerous moving pieces. Even if you have ample business knowledge, and perhaps ample marijuana knowledge, you still want to involve medical cannabis consultants in your business plan. For instance, some state laws require that the marijuana you dispense is grown and cultivated on site. Having the knowledge of the medical marijuana facility design and proper cultivating process to grow your own marijuana requires someone who understands the minute details of running a medical marijuana facility.
- Get investors on your team. Once you understand the industry and regulations in your area, you will need to develop clear cut goals and plans in order to gather investors. Getting medical marijuana facility developed and running generally costs between $250-500,000. As many as one-quarter of medical marijuana facility operators report that banks are reluctant to offer financing for this nature of business, making investors a necessity for gathering the necessary capital. Developing a solid plan for how your business is going to expand and profit will help you get investors on-board.
Running a medical marijuana facility can be the modern equivalent of striking gold, if you do it the right way. Your business will have the highest chances of gaining credibility, funding and success if you involve lawyers, cannabis experts, investors from the beginning.