Start An Edible Cannabis Business? But At What Cost?

2 months ago

Last week I made a post about some of the edibes I have been making for other people and at the end of the post I made a comment about the added cash income this little side biz was giving us.

Well my husband took it one step further over the weekend and mentioned I should check into opening a business; an edible business, as he had heard form someone at his work that if you have certain cannabis related businesses, that you're allowed up to 100 plants on site.

So this had me curious...

How does someone start a cannabis business in my state?

First it depends on the business. Will it be a dispensary (medical or recreational)? An edibles cafe?

Next... where will it be? Depending on the municipality you want to have this cannabis business, you will need to get approval from the city or municipality officials or board of commissioners. And not only that, but even if that particular city allows cannabis related businesses, you will have to pay a fee (up to $5,000) to apply.

Also, on the topic of fees... my state a non-refundable application fee...

The nonrefundable application fee, which must be submitted before an application will be processed, will be $6000

You also have to have an insurance policy that covers at a minimum of $100,000.

Right now the cost is up to a minimum of $111,000.

Let's continue...

Building Up The Cost

There are three different types of licensing in my state:

LARA is currently determining the annual regulatory assessment for fiscal year 2018 for each of the five license categories authorized by MMFLA. Grower A licenses are capped, by statute, at $10,000. Grower B-C, Processor, Transporter, and Provisioning Center licenses will be dependent on the number of total licenses subject to assessment and could be as low as $10,000 or as high as $66,000. The exact amounts of the regulatory assessments are not available at this time

BUT...

Wait... There's more....
More as in another $500,000 to the state licensing.

By statute, the assessment must also provide $500,000 annually to LARA for licensing substance abuse disorder programs in addition to five percent of the other state departments’ costs to the Michigan Department of Health and Human Services for substance abuse-related expenses.

Now we're at a minimum of $611,000! Plus the level and category of the a growers' license!

Cha-Ching!

The state just keep racking up the dollar signs here.

And let's not forget the liability and insurance... oh Lord, I'm trembling!

I just can't even start to assume the cost for insurance.

Will my license expire and how often will I have to renew my license?

Yes, a license will be issued for 1-year period and will need to be renewed annually

Every Year? Good Lord!

So I am thinking a minimum of $650,000 per year is what will be needed to have a cannabis related business in my state. Yeah, the state will be raking in the money for the fees and licensing.

I think I'll stick to the way things are now... as I only have about 5-percent of what it would cost to open, start and run a cannabis business here.

My state's guidelines for edibles

What will the costs be for a license?

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Yes.... Legal Cannabis is a Ponzi Scheme set up by the Government, Banks and Scammers. I’m going to just grow my 4 plants and hand out free seeds to everyone I know. Everyone can grow their own 4 plants in Canada and make their own edibles.

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Legal Cannabis is a Ponzi Scheme set up by the Government

Oh you nailed it!

I know in my state, banks won't even do business with dispensaries; but I bet they'll change their tune no that the government is involved and money is to be had.

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The entire Legal Cannabis Market in Canada is a Money making Scheme for a handful of Stock Trading Insiders, Bankers, Cops, and Politicians on the take via IPO Stock Options. Insider News allows a few people to Pump and Dump these stocks and make Millions. ... All involved are protected by the RCMP and Liberal Government.

WOT!!! 5K USD for the application alone...?! My goodness, I'd rather go underground and sell stuff by mouth propaganda...

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I know- isn't all the numbers crazy!!

I really appreciate this post! I’m in a similar boat where I have a small side business like most who bake edibles and would LOVE to make it more legitimate and my state (DELAWARE) expands its medical and, eventually, recreational use.

I thought about starting it as a compassionate meals business for more terminal patients and elderly patients.

I have a long way to go before this becomes a plausible option but I have started saving now! As if there is anything I know about the cannabis business is that there is a high buy in to get part of the action!

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I have to admit it too- I love making edibles for others to enjoy.

I thought about starting it as a compassionate meals business for more terminal patients and elderly patients

Now this????
Cannabis Meals On Wheels!!!

The cost is why I am really excited to find an investor, though we are not even legal in my state yet, but when we do go legal having that investor in place is a big win and I will still retain the majority ownership as there are tax benefits for women business owners, and he just want to a silent partner just like a bank would be. So that in itself is also a big win. When the state started issuing Hemp licenses in the state the same type of costs are involved in growing it. And this guy is the silent investor for my neighbor so I know this is a legitimate investor.

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The cost is why I am really excited to find an investor,

I saw your post about this and I am in awe of it!! You're so lucky!
Wish I could find someone locally like that... but then again, I do kind of like the way I do it now; without another person telling me what to do. I love being able to give personal touches to all my edibles too.

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that is always the great thing about the way we do things now. But I do want to go legit one day when it is legal. The other downside about legalization is your edibles can only be so strong. Mine are much stronger than those I have had out of legal markets. But I can always make my own personal at home once it does happen. If I live long enough to see it happen. But finally seeing Marion County say they won't go after possession of less than one ounce is a positive first step.

Better propagate your own for your own consumption. That's the most important part, right?

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I always make clones of strains I like to grow, have a good effect and that my patients like.