Our team has secured dozens of cannabis cultivation, production and dispensary licenses in competitive markets from coast to coast. We specialize in limited licenses processes, when the acting Government restricts the amount of cannabis licenses awarded to hopeful marijuana entrepreneurs. With firsthand experience in over 20 Marijuana Markets, we know the ingredients of a successful cannabis applicant. Read on and learn how to craft an award-winning cannabis license application with insider tips from our CEO Sara Gullickson.
Ready to get a head start on the competition? Contact us today to draft your Request for Proposal or Request for Application.
While thousands of cannabis hopefuls apply for facility licenses, only about one percent will be successful. In the marijuana industry, getting a cannabis business license is your first requirement to own and/or operate a plant touching business, which includes cultivation, processing or dispensing marijuana. In addition to the barrier to entry being extremely high, licensing and operational laws are complex and vary from state to state. In order to be included in the winning circle, you will need to understand these rules and regulations thoroughly.
Step 1: Prepare
Most of our successful applicants work on the steps outlined below over the course of 8-12 months. However, before getting ahead of yourself, you might want to ask yourself the following questions:
- Are you willing to comply with the state’s laws for cannabis businesses?
- Do you meet the qualifications (Felony / Drug Related Charge Free) to apply for a license?
- Can you build a team? Who will you partner with? Do they meet the application requirements?
- How much funding do you need and how will you fund your operation?
- Do you have $100-200k to invest in your cannabis application?
- Will you be able to secure Real Estate? Do you have a good relationship with your community?
Step 2: Write a Business Plan
When you start any business, you need to write a business plan and cannabis isn’t any different. We see so many people jump into the industry too quickly and we encourage individuals to slow down and implement tried and true business practices. A well-written business plan lays everything out on paper including: Industry Statistics, Federal Overview, Market Overview, Competition, Team, Financial Projections, Funding, Real Estate, Timeline, etc. If you require business planning assistance, contact us.
Step 3: Create a Budget and Financial Projections
As you know, it’s almost impossible to start a business without money and most cannabis entrepreneurs will need to double down. If you think you will need $20,000, you will most likely need $40,000. Cannabis licenses are expensive and most winners pull out all the stops to secure one of these coveted licenses. For example, licensing and applications fees can cost tens of thousands of dollars. Each State program application requires a different monetary amount as well as a liquid asset stipulation in the event you are awarded a provisional certificate. Therefore, we recommend, developing a two-prong budget that includes pre-licensure as well as post licensure. Work with a financial expert (or bring one onto your team) who understands the cannabis industry and can help you create realistic financial projections or contact us for capital advisement.
Step 4: Build Your Team
It’s essential to start securing industry talent even before securing a license. Not only will you need to hire employees with experience, you will need to select strategic partners to round out your team. This proactive approach will help assist with funding the startup and securing your cannabis business license. Investors are more likely to provide capital if you can show them you have seasoned marijuana professionals as well as local talent. In addition to investors, the licensing review panel will also ask for details on your team’s expertise, skills and ability to operate a compliant business. Keep in mind, both employees and partners will need to go through background checks, meet specific qualifications, and obtain individual agent cards to operate in a cannabis facility. A best practice is to run a background check on all internal team members who will be participating in your operations as partners and/or employees. If you are building out your advisory board for your cannabis operation and need help, please contact us for guidance.
Step 5: Secure Property
We always HIGHLY recommended clients secure real estate, especially in a competitive merit-based program, even if it’s not an application requirement. This entails finding a property that meets state program setback requirements as well as landlord approval (if you’re leasing) to use the property for a marijuana business. And, in some cases you will need to get approval from the municipality though a special use permit or even a zoning variance.
Step 6: Develop Procedures
Standard operating procedures (SOP’s) for your cannabis business are often mandatory for license applications. Make sure your SOPs are customized for your state process in order to increase your chances of success. The easiest way to get customized and compliant SOPs is to hire an expert. Examples of the SOPS you will need to develop are listed below:
- General Operations
- Cultivation/Grow Specific
- Processing/Manufacturing Specific
- Dispensary/Retail Specific
- Packaging & Labeling
- Security
- Transport
Step 7: Complete the License Application
Now that you understand the ingredients required to submit a cannabis application, it’s time to write your application. Be sure to dot your i’s and cross your t’s – there is no room for error in a competitive merit-based program. The application is a test by the Governing Body to ensure you are ready to go if selected for a cannabis license. Your job as an applicant is to instill confidence in the grading panel that you have the right team to get the job done.
Each state has a different application; however, most criterion include:
- Ability to operate
- Operations plan
- Economic impact and diversity
- Community benefit
- Applicant organization, ownership, capital, and tax status
- Product manufacturing
- Quality assurance and staffing
- Geographic distribution
- Financial standing
- Real property and equipment
- Sales and dispensing
- Affiliation with a doctor
- Security
- Architectural design
- Transportation and distribution
- Technical and technological ability
- Infrastructure
- Cover letter
Ready to get a head start on the competition? Contact us today to draft your Request for Proposal or Request for Application.