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Montana legalized cannabis for adult consumption in November 2020. In April 2021, the Montana legislature passed measure HB 701 to implement the recreational marijuana legalization initiative. The legislation allows consumers over the age of 21 to possess up to 1 ounce of usable marijuana, with no more than eight grams in concentrate form. Montana residents cannot purchase more than five ounces of usable cannabis in a single month. The adult-use program will join the already-existing medical marijuana program in Montana, which has been in effect since 2004. 

Interested in starting a recreational cannabis dispensary in Montana? Here’s what you need to know about the process.

Applications

Legal recreational cannabis sales are slated to begin on January 1, 2022. 

As far as exact regulations go surrounding the adult-consumption program, the state of Montana still needs to establish this, but we do have some information to give you already.

The legislation indicates the regulations must be developed by October 1st, 2021 and begin accepting applications from medical marijuana dispensaries that are in good standing with the state of Montana on the same day. Those applications will be approved or denied within 30 days of submission. Unfortunately, during the first 12 months of the program, only existing medical marijuana facilities will be able to apply for recreational licensure.

Under the current rules for the state’s medical marijuana program, Montana dispensaries must possess three separate licenses: a canopy license, a cultivation license, and a dispensary license. In Montana, dispensaries must cultivate all of their own cannabis, per the law. If you want to produce concentrates or other manufactured goods, you’ll need to acquire a separate manufacturing license.

For the recreational program, cannabis retailers will be allowed to sell cannabis products cultivated by a business other than their own, though these products are only allowed to make up 50% of their total inventory. Montana dispensaries will be allowed to outsource manufacturing to a contractor, so long as that business has its Tier 1 canopy license as required by state law. You may not sell your license, though your cannabis business itself is able to be sold.

Here is the cost of applying for licensure, according to Montana’s Department of Health and Human Services:

License Type Annual Fee
Canopy – Micro Tier $500
Canopy Tier 1 $1,000
Canopy Tier 2 $2,500
Canopy Tier 3 $5,000
Canopy Tier 4 $7,500
Canopy Tier 5 $10,000
Canopy Tier 6 $13,000
Canopy Tier 7 $15,000
Canopy Tier 8 $17,500
Canopy Tier 9 $20,000
Chemical Manufacturing Endorsement (MIPP) $100
MIPP Location (each) $500
Dispensary (One Registered Premise) $500
Dispensary (Two or Three Registered Premises) $5,000
Dispensary (Four or Five Registered Premises) $25,000
Dispensary (Six or More Registered Premises) $100,000
Employee (Agent) Badges $10.00

 

Securing Capital

It can be challenging to secure capital in the cannabis space. The federal government says cannabis is a controlled substance, therefore traditional lending options are out of the question. This leaves cannabis companies with limited options for raising capital. The most common way cannabis businesses raise capital is through private investors. Fortunately, there are many private investors willing to invest in the cannabis space.

Staffing Cannabis

It can be difficult to staff a cannabis company. The importance of budtenders cannot be overstated. You want to hire workers who are not only passionate and knowledgeable about cannabis but also willing to work hard for the industry’s success. 

The most important part of staffing your dispensary is training the people you hire. Make sure you have a comprehensive training program in place that teaches your staff to not only properly interact with customers and make them feel welcome, but recommend the best products for them. Remember, you’ll get many customers who have never used cannabis before. Your budtenders need to be able to break it down in the simplest terms possible.

Montana’s minimum wage is $8.65; paying a higher livable wage is a great way to source great talent while boosting staff loyalty and retention. 

Note: It costs about $250,000, on average, to staff a dispensary for a year.

Sourcing Product

As a cannabis dispensary owner, there are few more important things than selling a great product. When sourcing products, it’s important to remember that Montana’s law only allows for 50% of outside products, so half of your store will be filled with your own product. Make that other half count! Find a supplier with a proven track record of supplying consistently high-quality and safe products to cannabis dispensaries. 

If you notice inconsistent product quality, poor communication, or supply chain challenges, it may be time to find another supplier that will better service your needs.

Compliance Considerations

When it comes to cannabis, you can’t be compliant enough. According to the federal government, you’re handling a controlled substance, so compliance is critical in this space. 

There are many things to keep in mind when it comes to compliance, such as inventory management. In accordance with Montana law, licensed retailers need to use the METRC tracking system to track inventory from seed to sale. 

For compliance purposes, you also need to ensure your dispensary is fully equipped with cameras that allow you to view every angle of the shop. Where you’re located, how you market and advertise your dispensary, the cash controls you have in place, and even your product packaging will have to meet compliance standards.

Marketing Your Cannabis Dispensary

Marketing a dispensary can be tricky due to compliance considerations. What’s more, the increasing competition you’re bound to face when applications open up for recreational licenses will make it more difficult for your cannabis brand to stand out. Not to mention, cannabis companies face legal limitations when it comes to advertising and marketing. 

Mary Jane Marketer can help you attract and retain customers with branding, marketing, and advertising that works in the cannabis space. Just book a consultation to get started.

Need Help with Your Dispensary License Application in Montana? 

If you’re not already a Montana medical marijuana dispensary owner, you’ll have to wait a year before applying to become a recreational dispensary owner. In the meantime, plan! You can never plan too much or too early. The application process is stringent, complex, and time-consuming, so it’s good to get a head start. 

Want to learn more about opening a dispensary in Montana? Fill out the form below.



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