How to Open a Dispensary in Michigan

Posted on November 22nd, 2022 to Entrepreneurialism

Michigan was the 10th state in the country to legalize cannabis for recreational use in 2018. If you are thinking about opening a dispensary in Michigan, you will have to meet several requirements throughout the process.

How to Open a Dispensary in Michigan

The adult-use cannabis program is overseen by the Cannabis Regulatory Agency (CRA) in accordance with the MI Regulation and Taxation of Marihuana Act (MRTMA). The state is highly thorough when it comes to establishing marijuana establishments, which means the process to obtain a license is a bit more stringent and time-consuming than it is in some other states. Below is a basic overview of how to start a dispensary in Michigan.

1. Research State and Local Regulations

MI has an extensive list of administrative rules that apply to cannabis retailers and establishments. When you are planning on opening a dispensary in Michigan, getting familiar with these regulations is the best place to start. These rules go over everything from how to get a dispensary license in Michigan to requirements the business must follow once it is up and running. While this is not a comprehensive list, the state’s laws can dictate:

  • Who is legally allowed to open a dispensary in MI
  • How cannabis can be displayed within the business
  • Cannabis sales tracking and recording requirements
  • Where a dispensary can be located
  • Security measures a retail establishment must have in place
  • How the dispensary can be marketed

2. Complete the MI Prequalification Process

MI does things a bit differently than other states. Before actually applying for the cannabis retailer license, interested parties must first go through a prequalification process. Due to the extensive nature of the two-part application process, it is a good idea to expect getting everything submitted and completed to take several months. During the prequalification process, you will be required to:

  • Undergo a background check
  • Provide demographic information
  • Attest to multiple authorizations and agreements
  • Provide copies of governing documents
  • Provide tax compliance documents
  • Submit a social equity plan if applicable
  • Pay the $3,000, non-refundable prequalification application fee

All supplemental applicants, which can vary depending on the business structure, will also have to go through this preliminary application process. For example, MI considers any employee in a management position to be a supplemental applicant, as well as anyone who owns more than 10 percent interest in ownership. Supplemental applicants do not have to pay the $3,000 fee.

3. Create a Comprehensive Business Plan

After you have gone through the general prequalification process, you will need an extensive business plan in place to proceed. In many regards, it can be helpful to already have a good business plan in place even before submitting your prequalification application. However, you will not be able to proceed with obtaining a marijuana establishment license unless you have a complete business plan, as well as your actual physical location ready for inspection. The business plan should include:

  • Business specifications
  • Proof of financial plans and responsibilities
  • Municipality information
  • Information about your planned employees
  • Operational or procedural plans
  • Security information
  • Marketing plans
  • Technology plans

4. Secure Your Cannabis Location

When you submit the second part of the application process in MI to obtain your Michigan state dispensary license, your physical location will have to undergo an inspection within two months. Therefore, you will need to secure your location before proceeding to the final stage of gaining licensure. If the location is not inspected within that time frame, the license application can be denied.

5. Apply for Your Marijuana Establishment License

To apply for the marijuana retailer license, you will need to supply:

  • Your approved prerequisite documents
  • A copy of your full business plan
  • A comprehensive establishment floor plan
  • A Certificate of Assumed location name
  • Proof of occupancy or deed that declares a lease agreement

To obtain your MI dispensary license once approved, you will have to pay a $15,000 fee initially and a $15,000 licensure renewal fee every year.

Need help with a retail cannabis marketing plan?

Marketing your new MI dispensary is a huge part of ensuring a successful cannabusiness venture. At CannaPlanners, that’s what we’re all about. Ready to build your marketing strategy? Let’s work together.

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