How to Become a Medical Marijuana Distributor

by David Thyberg; Updated September 26, 2017
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Opponents of marijuana argue that legitimizing the pot industry will lead to increases in abuse of the substance, yet statistics shows that during the 10-year period following California's 1996 legalization of medicinal marijuana, teen usage declined between 25 percent and 50 percent statewide, according to writer Christina Davidson of the Atlantic. Public support for legal marijuana distribution continues to grow, as evidenced by the rapidly growing number of medical marijuana dispensaries operating within the confines of state legal systems throughout the country. Dispensaries provide doctor-approved patients with natural products to help their conditions. Even so, becoming a medical marijuana distributor remains a risky enterprise. Entrepreneurs must be extremely vigilant and cautious when opening a dispensary business.

Items you will need

  • Zoning permits
  • Property lease
  • Incorporation documents
  • Business licenses
  • State-specific permits
  • Security system

Preliminary Steps

Step 1

Assemble the necessary financial capital to launch the dispensary and develop a detailed business plan addressing all aspects of the venture. According to the Law Offices of Jacek W. Lentz, one of the key decisions at the outset will be whether the business model will center around a pharmacy-style dispensary devoted exclusively to the sale of medical marijuana, or if it will take the form of a growers' collective or a full-service collective offering additional services to member patients.

Step 2

Determine the best location for the business. States like California and Colorado have especially liberal policies when it comes to medical marijuana distributors, and a handful of other states also feature legal avenues for the sale of this substance as a medicinal product. Thoroughly research state, county and city laws relating to medical marijuana to find the location that will be most receptive to such a business. Pay special attention to local ordinances and bans as well as potentially sensitive local establishments like schools, churches and public parks that could impede the business from developing. Sign a lease for the commercial property that will be used as an official storefront after finding a suitable location. This must take place before you can obtain any permits.

Step 3

Get an official script from a doctor authorizing your possession of marijuana. TheWeedBusiness.com and MadeMan.com both recommend that dispensary owners take the time to become registered "Cannabis Club" patients as a safety measure which will help provide added protection from future prosecution or other legal pitfalls.

Step 4

Incorporate the business. Come up with an official name and register the company as a non-profit collective. This will involve the establishment of a board of directors and the filing of articles of incorporation. Hire an experienced lawyer to make sure the paperwork is in order so there are no loose ends in terms of liability.

Step 5

Obtain the necessary licenses and permits to open the business. Licensing requirements vary from state to state and county to county, so be prepared to deal with a lot of bureaucratic processes and red tape. Meet with relevant officials and government agencies to discuss local laws and required paperwork, and don't forget to make arrangements for all applicable tax payments.

Operational Steps

Step 1

Make the dispensary operational after successfully going through all the legal hurdles. Create a membership system that will keep accurate records of all clients. Have new members sign waivers to protect the business from any liabilities that may result from their activity with marijuana.

Step 2

Set up security equipment in and around the dispensary. Monitor the interior of the store as well as the parking lot and the street area out front and in back of the building with video cameras to protect the business from theft, vandalism, raids and other such threats.

Step 3

Hire staff members. Select knowledgeable applicants with experience in the marijuana industry and demonstrated trustworthiness. Make a list of all the staff positions to be filled, including sales clerks, inventory stock workers and security guards.

Step 4

Advertise the dispensary to attract clients and begin to sell products. Consider posting ads in local newspapers, Internet web-pages, doctors' offices and other outlets.

Tips

  • Work to create a positive relationship with the community surrounding the dispensary. Keep clients under control and make attempts to forge ties with other local business owners and residents. Run the business as a responsible and non-imposing enterprise to reduce the risk of community outcry and other negative effects.

Warnings

  • Remember that marijuana is still an illegal substance under federal law. The sale and possession of marijuana is still very risky, even for those who seek to run legal dispensaries which satisfy state ordinances. The The Law Offices of Jacek W. Lentz reminds marijuana entrepreneurs to keep legal counsel at all times and proceed with extreme caution.

About the Author

David Thyberg began his writing career in 2007. He is a professional writer, editor and translator. Thyberg has been published in various newspapers, websites and magazines. He enjoys writing about social issues, travel, music and sports. Thyberg holds a Bachelor of Arts from the University of Pittsburgh Honors College with a certificate in Spanish and Latin American studies.

Photo Credits

  • BananaStock/BananaStock/Getty Images