If you are running a dispensary in a state where medical cannabis is legal, and your state is introducing legislation to legalize marijuana for recreational use, this resource is for you.
Making the switch from a medical marijuana dispensary to a recreational cannabis dispensary will require some planning and oversight. This article will give you some items to consider for your pre-switch checklist. First, here are some facts on legalized cannabis in the US.
Which states have legalized recreational cannabis?
According to the National Conference of State Legislatures, 21 states and the District of Columbia have legalized recreational marijuana use for adults: Alaska, Arizona, California, Colorado, Connecticut, Illinois, Maine, Maryland, Massachusetts, Michigan, Missouri, Montana, New Jersey, New Mexico, New York, Nevada, Oregon, Rhode Island, Vermont, Virginia and Washington.
Recreational cannabis is also legal in Guam and the Northern Mariana Islands.
Oklahoma is voting on recreational cannabis legalization in early 2023.
Which states have legalized cannabis for medical use?
As of November 2022, 37 states have legalized the medical use of cannabis in some capacity: Alaska, Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Illinois, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Utah, Vermont, Virginia, Washington and West Virginia.
Also, the District of Columbia and the territories of Puerto Rico, Guam, the Northern Mariana Islands and the US Virgin Islands have all legalized the use of medical marijuana.
Considerations When Moving from Medical to Recreational Dispensary
Here are some things the dispensary ownership and management must address when making this change.
Applying for a new license
Medical cannabis and recreational cannabis are two separate categories. States that have approved recreational use require a new license for adult-use cannabis sales. Some other things you will need to check.
- Some local ordinances require a recreational dispensary to be a minimum distance from churches and schools. Find out if you need to find new commercial space, or whether you can stay in the same location.
- Licensing availability. Some states prioritize recreational licensing for medical marijuana dispensaries ahead of brand-new dispensaries.
- The licensing for recreational cannabis sales may be more than medical marijuana sales. Research how much you will need to spend on the new license.
- Find out what paperwork and documentation you will need to gather for state and local licensing.
- Delivery and Curbside Pickup. Although this is not legal in every state, in states where this is common, your customers will expect this service. Some local jurisdictions will require special licensing for these services.
Changes in Inventory
Each state has their own regulations regarding medical and recreational cannabis sales. Some states may require products to be sold under one category or the other, but not both. A few states allow for cannabis products to be sold under either category.
If your state requires separate inventories for medical marijuana and recreational cannabis, you may choose to move strictly to recreational, or carry two sets of product inventory, according to local potency laws and regulations.
Pricing and Local Regulations
Some states may have limits on recreational cannabis sales and the amount of cash a dispensary may have on hand. Additional taxes that are levied specifically on recreational-use cannabis products may also be applied to your sales. These can include state excise tax, sales tax, regional/local tax, and federal taxes.
Most states have their own compliance programs for selling cannabis. Some states allow dispensaries to be enrolled as both a medical and recreational simultaneously (in states where recreational use is legal.) Check with your local and regional regulating bodies to find out what they require from your dispensary to make the switch from medical to recreational cannabis sales.
Store Layout and Customer Flow
All dispensaries have a check-in area, where state ID is verified, before customers enter the main sales floor. Some dispensaries that are set up strictly for medical marijuana sales have a point where customers pay for their purchase, and then go to another station where their order is fulfilled and picked up, like a pharmacy. If your dispensary is moving to strictly recreational sales, this portion of the overall floor may be repurposed for additional inventory or dispensary displays. If your dispensary will serve recreational and medical customers concurrently, you may adjust the waiting room to have these customers follow a different flow.
Making the change to a recreational cannabis dispensary will require some updated training for your budtenders and other staff. With an expanded product line, the staff will need to be more knowledgeable about new products, potencies, and effects.
For state compliance policies, staff will also need to be aware of how to track sales and customer categories.
Lastly, moving to a recreational sales model will likely cause a sustained spike in customers. Since there are less restrictions on recreational sales vs medical sales, more customers will show up on a regular basis. This influx of new and returning customers may necessitate hiring additional budtenders.
Dispensary Displays and Fixture Experts
For more than 25 years, Bud Bar Displays has been helping dispensary owners with innovative product displays. Our product line of dispensary cabinets, cannabis display pods, concentrate displays, and other dispensary displays are used in dispensaries worldwide.
Our award-winning team is ready to help you find the perfect configuration of retail cannabis displays for your shop. You can order online directly from our e-commerce store, reach out via email, or call us directly at (916) 858-2000.