How to Start Your Own Cannabis Brand: Licensing

Starting a cannabis business could be one of the most rewarding things you ever do. But when it comes to cannabis licensing, the industry requires a lot of attention to detail.

Even with a solid business plan, the cannabis licensing authority requires you to go above and beyond what you'd typically have to do when starting a business in another industry. 

To make your life easier and to help ensure your business survives, a brief guide follows: how to start a cannabis brand and the steps involved in obtaining a cannabis license in California. Consider this to be your cannabis licensing application guide!

The Basics of Building a Cannabis Brand 

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When starting any cannabis business in the United States, be prepared to work hard. One of the most challenging aspects of starting a cannabis business is obtaining the correct licenses.

Like any new business, you need to focus on a host of initiatives, including: 

• Branding (don't make these branding mistakes!)
• Marketing
• Manufacturing
• Product development
• Appropriate premises
• Packaging
• Sales
• Working with vendors
  

Before you even look at cannabis licensing, here are just some of the things you'll need to consider:

• Business plan: A detailed business plan outlines all aspects of your business from start to finish, including timelines, budgets, wages, profit, loss, and KPIs. 
  

• Branding, marketing, and advertising: What's your brand, and how does it differ from others? What's your marketing plan? Do you have an advertising budget? 
  

• Manufacturing and product Development: What products are you selling? Are you making them yourself? Are you getting them from another supplier?
  

• Business Premises: Where will your business be located? How much space will you need? 
  

• Staff: How many employees will you need? Full-time, part-time, or both? What experience is required? How much will they be paid? 
  

• Vendor relationships: Are you working with any vendors? How much do they charge? How long does it take for products to get from them to you? How much product can they supply?
  

Cannabis Licensing Requirements 

The license type for cannabis businesses and how you get it can vary from state to state. It can even vary by the municipality within the same state. 

Some states have open application periods for cannabis licenses. Others limit how many people can apply, hold a cannabis license, and when they can apply.

Other factors to consider when applying for a cannabis license include your residency status and if you have any criminal convictions.

Some of the most common cannabis businesses include:

• Dispensary
• Grower 
• Product manufacturers (such as edibles) 
• Sales and delivery 
  

The licenses you need to apply for will depend on the cannabis business you're starting.

How Does Cannabis Licensing Differ from State to State? 

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Every state has independently set up how they control the requirements for obtaining a cannabis license. Each state has different rules for: 

• Who can apply for a license
• When can you apply
• How long the approval process takes
• How much are licensing costs
• How many licenses can be issued
  

It's recommended that you research each state's license requirements before you start operating your cannabis business. You may decide that one state is better suited for your business over another.

Does the Type of Cannabis Business You Operate Affect Licensing? 

Yes. You'll need to align your cannabis business license with the type of business you plan to operate. 

The following subsections use California cannabis license requirements as an example. Check your state's licensing requirements carefully.

Licenses for Growing Cannabis

• What licenses do growers usually need in legal rec states? There are dozens of different growing licenses. They depend on what you're growing, the amount you're going, the method you're growing, and where you're growing.
• What's the cost of a growing license? Application costs range from $135 to $10,000. License fees are anywhere from $1,205 to $77,995. 
• Who's in charge of granting growing licenses? The Department of Cannabis Control (DCC).

Licenses for Cannabis Edibles

• What licenses do edibles manufacturers usually need in legal rec states? Several cannabis manufacturing licenses depend on what you're making and the amount you produce. 
• What's the cost of an edible manufacturing license? Application costs range from $500-1,000. License costs and fees are generally based on annual gross revenue, ranging from $2,000 to $75,000.
• Who's in charge of granting edibles manufacturing licenses? The Department of Cannabis Control (DCC).

Licenses for Cannabis Dispensaries

• What licenses do dispensaries usually need in legal rec states? Retail cannabis licenses are generally for storefronts or delivery. However, you may need both types depending on your business model.
• What's the cost of a cannabis dispensary license? Retail license application costs start at $1,000. Fees can vary from $2,000 to $75,000 depending on annual revenue.
• Who's in charge of granting dispensary licenses? The Department of Cannabis Control (DCC).

Knowing the Ins and Outs of Cannabis Licensing Could Save You Headaches and Money

While starting a cannabis business begins like many other businesses, you'll soon realize that cannabis licensing is one of the most critical aspects. Without the appropriate cannabis licenses, even the most organized business can fail to get off the ground. 

Starting any business is a challenge, even more so if you're planning to join the cannabis industry. Take time to ensure your cannabis licensing requirements are met. Be sure you comply with all state, local, and industry regulations, and don't make these mistakes. It could save you headaches and money, and it could even be the difference between success and failure.

Do You Already Have a Dispensary Up and Running?

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