How to Open a Dispensary in Michigan

How to open a dispensary in Michigan

Are you thinking about opening a recreational dispensary in Michigan? Congratulations!

In 2018, Michigan was the 10th state to legalize adult-use cannabis as part of The Michigan Regulation and Taxation of Marihuana Act (MRTMA). As the first state in the Midwest to allow recreational dispensaries, the market has grown rapidly and continues to set monthly sales records. Michigan is considered the second-largest cannabis market in the US.

The business opportunity is ripe for cannabis entrepreneurs.

This guide is designed to help prospective cannabis dispensary owners understand the specifics of opening a dispensary, including details like licensing, financing, real estate, security, staffing, compliance, inventory, tech stack, and more.

Scroll through for a step-by-step process for getting a dispensary open in Michigan, or use the links on the left to jump to what you need.

Before you start, take a moment to review Michigan’s adult-use cannabis laws and licensing eligibility requirements. It is the responsibility of dispensary owners to be in compliance at all times, and being intimately informed about the laws is your first step.

Also know that in Michigan, medical facilities are called “provisioning centers” and the spelling of “marihuana” is often used in legal documents. We’ll use various spellings of the term in the discussion below.

Disclaimer: Always consult your lawyer, accountant, realtor, or other trusted consultants to help you navigate the complexities of opening a cannabis dispensary. The information provided herein is designed to illustrate and educate, but is not to be construed as legal or financial advice.

Plan your Michigan cannabis business

The first step for any business owner is to get your business affairs in order. This is especially true for cannabis business owners. You’ll need to understand your state’s cannabis laws, create your formal business entity, and prepare to submit an application.

Forming a legal business entity, writing a business plan, and finding a location is first on your to-do list.

Form a business entity

If you don’t yet have a business formed, that comes first. Work with a lawyer to ensure everything is correct, but at a minimum, you will need to decide whether you’re creating an LLC or corporation, and file with the state of Michigan.

Then you will get tax ID numbers for the business, open a business bank account at a cannabis-friendly bank or credit union, and look into business insurance.

Note: Every city, county, and state is different. You may have additional steps for taxes, licenses, or fees based on your business type and location.

Can dispensaries use banks?

Write a business plan

Cannabis is a complicated industry, with more compliance and legal considerations than other types of businesses. Having a rock-solid business plan can help you be prepared for anything that comes your way.

It may be tempting to skip this step, but your dispensary business plan must be submitted to the regulatory body for Michigan, called the Cannabis Regulatory Agency (CRA), with your application.

The CRA also requires applicants to present a “plan to involve communities disproportionately impacted by marijuana laws.”

A good business plan for MI dispensaries should include:

  • The physical location of your dispensary

  • Funding plan, or where your startup and ongoing capital will come from

  • Sourcing plan for procuring your cannabis products

  • Revenue projections

  • Estimate or actual number of employees, or who you’ll hire for what roles and your dispensary org chart

  • Diversity and equity plans

  • Marketing plan

  • Safety and security plan

  • Technology plan, including which cannabis point-of-sale and compliance software you’ll use to manage your dispensary

  • Any other relevant information you want to document

Note: The CRA used to be called the MRA (Michigan Marijuana Regulatory Agency), but changed their name after recreational legalization to more accurately reflect.

Find a location

Your dispensary location is a critical piece of the puzzle, but not an easy one. You’ll need something in a visible location, with ample parking, and enough space to achieve your ideal workflow.

But most importantly, it needs to be in a municipality that accepts cannabis businesses. Michigan is an “opt-out” state, meaning local areas can choose to not allow dispensaries.

Every state has specific regulations about where dispensaries can be located. In Michigan, your dispensary must not be located within 1000 feet of other dispensaries, liquor stores, or “drug-free” zones like schools or childcare centers. Dispensaries may not be located in residential areas without written approval from the district.

However, each municipality can add to or adjust these location requirements so check with your desired municipality before choosing a location to ensure you’re abiding by all rules.

You don’t need to have your location locked in for step 1 of the application process (pre-qualification), but you should have a general plan for location outlined as part of your business plan. You will need to have your location solidified before you apply for step 2 (you’ll need to have an inspection within 60 days of application).

Find a local professional who specializes in cannabis real estate to help in your search. We also recommend using public resources available to you, like city zoning and administration offices.

When looking for a location for your dispensary, focus on spaces are:

  • in alignment with your business plan
  • large enough to meet your needs
  • in an appropriate location to serve foot traffic with ample parking
  • able to scale as you grow or expand
  • within your budget

In addition to monthly costs, factor in how much it’ll take to renovate or retrofit the space for your business needs. Finally, look at local competition (both existing and planned).

There are many considerations that go into finding the perfect location for your retail dispensary. Take the time necessary to secure the best possible space to help ensure your success.

Secure funding

Now that you have a plan for your new recreational use dispensary, you can start to put together a more clear budget and plan.

A cannabis business can generally expect expenses in these categories:

  • Real estate and build-out - consider your initial costs, plus ongoing rent or mortgage. You’ll probably also have renovation expenses to start.

  • Licensing/application fees - the cost of getting licensed to run a dispensary in Michigan. You’ll also need to plan for your annual renewal fees, which is $15,000 for retailers.

  • Operational costs - your day-to-day business operating expenses including, but not limited to, utilities, business or professional fees, marketing, etc.

  • Hardware, software, security, and other tech - many of these are monthly or annual subscriptions, but may include more sizable startup costs.

  • Staffing costs - the cost of hiring employees, including salaries, benefits, taxes, etc.

  • Inventory costs - or the actual expense of sourcing and purchasing your cannabis products. You’ll need to have enough stock on your shelves for opening day and beyond.

  • Taxes - cannabis businesses are heavily taxed and can’t participate in normal business write-offs like 280E, so plan ahead for your quarterly tax payments.

Do you have a plan for where this money will come from? As a cannabis business owner, you have a few options for funding:

  • Self-funding - the easiest option is to already have access to capital (acquired through legal means).

  • Friends and family - another potentially easy way to meet dispensary capital requirements is through loans or investment from family and/or friends.

  • Partners - many cannabis businesses are legally set up as partnerships, where each partner contributes something meaningful. Partners can be silent (they primarily serve as the funder), or active; both are great if they serve your needs.

  • Loans - depending on your personal finances, you may be eligible for a personal loan to cover some (or all) of the upfront costs of opening a dispensary. You may also be able to secure a dispensary business loan, but be honest with your lender in how the funds will be used; not all financial institutions will work with cannabis businesses.

  • Private funds - whether it’s private equity, angel investors, or venture capital, you may have to look to outside investors to fund your cannabis business. This option will decrease your ownership stake in your company.

  • Crowdfunding - another less-popular but potentially viable option is to look to the general population to support your business venture.

  • Brokers - cannabis-specific brokerage companies can help you find funding for startup expenses, equipment, and more. FundCanna and CFG Bank are two options that serve Michigan dispensary businesses.

Note: Medical marijuana facility applicants (called "provisioning centers") must submit a source of funding with their application.

What does it cost to open a dispensary in Michigan?

Most sources suggest having between $250,000 – $1 million to open a dispensary. But that’s not all that helpful. Here’s a formula to give you a sense of what to expect. You can come back and fill in the details as you know your unique estimates.

Note: This estimate is for a standard business. Micro businesses have significantly reduced fees.

Application and licensing fees in Michigan = $18,000

  • Application fee = $3,000
    • Due when the application is submitted to the CRA.

    • This fee is non-refundable.

  • Licensure fee = $15,000
    • Due upon approval for licensure.

  • Renewal Fee for Marijuana Retailer = $15,000 per year.

Real estate fees = $100,000

  • Includes annual rent or mortgage premiums, plus upfront design costs.

  • Could be higher in more expensive cities, or for larger remodels, or cheaper in more affordable areas of the state.

  • Plan for higher costs up-front, but it’ll stabilize over time to just rent/mortgage and maintenance/repairs.

Employee salaries = $300,000

Your store size and operating procedures will determine how many initial staff members you’ll need, but plan for around six employees to start, including a manager, several budtenders, and an inventory specialist. This figure includes an average of $20/hour, plus overtime, benefits, etc.

Professional fees and services = $50,000

This may decrease in future years, but to start, expect to pay for legal, financial, insurance, and other professional consulting fees to get your business started.

Security, hardware, and software = $50,000

This covers all network, security, hardware, and software for your business, including computers, TVs, printers, scanners, internet, and other software like POS, ecommerce, payments, etc.

After your initial investment, plan for at least $2,000 per month in recurring software expenses.

Marketing expenses = $100,000

Perhaps the most variable of your costs when opening a cannabis business, this factors in one full-time marketing staff person (or agency costs per year), plus costs for your website, ads, printing, etc. to promote the dispensary.

Cannabis products = $1,500 per pound

Your cost of products for opening day (plus ongoing stocking) will vary greatly based on your store size, number of SKUs, stock on hand, and supplier rates, but plan for an average of $1,500 per pound of cannabis products, including flower, edibles, vape cartridges, tinctures, topicals, lotions, capsules, beverages, prerolls, etc.

GRAND TOTAL = $618,000 (not including cannabis product inventory)

*Disclaimer: This is a rough estimate of the upfront and first-year costs of opening a recreational cannabis dispensary in Michigan. It is to be used for informational and illustrative purposes only as every market, location, and business will have unique startup costs.

Apply for a Michigan recreational dispensary license

Michigan’s adult-use licensing process has been around for a few years, and the CRA website is pretty simple to navigate. On the “Adult-Use Establishments” page, you can apply online, watch a video, see online application resources, apply for renewal, and even notify the state of closing your licensed marihuana business.

You can also find updated lists of municipalities who have either opted-in or opted-out of the program.

The state published these guides to help you through each step of the process.

The basics of applying for a dispensary license in MI

  • To open a dispensary in Michigan, you need a dispensary license. There is no stated limit to the number of dispensary licenses available.

  • There are two steps to the application process: Pre-qualification and application. Step 1 (prequalification) must be achieved before you can submit a step 2 application. Step 2 applications will be accepted or rejected within 90 days.

  • You will need to submit an application, detailed operational plan, business plan, and detailed diversity plan.

  • If you’re planning to operate a small operation, you may be eligible for a microbusiness license, which limits the amount of cannabis a business can grow or possess.

  • A municipality can limit the number of licensed marijuana establishments in the area.

How to get a dispensary license in Michigan

Applying for a license is a multi-step process. First, you must register and create an account with LARA (Michigan’s Department of Licensing and Regulatory Affairs). This includes:

  • Reading and accepting the disclaimer

  • Setting up login information

  • Adding contact information (either as an individual or business)

  • Logging into the system

Step 1: Prequalification

This is where you start your journey to applying for a license. According to the CRA, “The main applicant and each supplemental applicant must submit prequalification applications. During prequalification, background checks are completed on the main applicant and all supplemental applicants.”

The main applicant is the entity (LLC or other business structure) or individual (sole proprietor) seeking to hold the retailer license. There is a $3,000 nonrefundable application fee for the main applicant. The main applicant is who submits the step 1 prequalification application.

Supplemental applicants must also submit a step 1 prequalification application, but there is no application fee. Who is considered a supplemental applicant? It depends on your business structure. The state outlines each business type on the Step 1 Prequalification Resources page.

Note: If you’re a social equity applicant, you must apply for that program before you submit your materials for prequalification.

Before submitting your prequalification application online, collect all your documents. You must complete the application in its entirety. If you submit an incomplete application, you only have 5 calendar days to rectify the issue.

The following documents are required:

  • Attestations - there are 5 documents (attestations) you must submit PLUS a signed and notarized acknowledgement of attestations.

  • Entity information - you’ll need to send your governing docs (like bylaws or operating agreement), certificate of good standing, approval to conduct business transactions in Michigan (if applicable), certificate of assumed name (if applicable), copy of organizational structure (main entities only), authorizing resolution, and social equity plan (for main entities only).

  • Regulation documents - this is a copy of marijuana licenses (if applicable), and a summary of facts and circumstances concerning license denial, restriction, revocation, suspension, or nonrenewal (if applicable)

  • Tax compliance - this is a copy of notice of tax liability due (if applicable)

  • Litigation documents - this is any litigation documentation (if applicable)

To actually submit, you’ll log into the system using the log-in details from the prior step. Click “Adult-Use Establishment Licensing” and “Create an Application.” Once you accept the disclaimer, you’ll be given options. Under “Adult-Use Step 1: Prequalification Application,” select either “Entity Registration,” “Sole Proprietor Registration,” or “Supplemental Individual Registration.”

You’ll then follow the prompts to choose your license type, add your entity contact information, note whether social equity applicant, identify your entity structure, add associated parties, enter tax information and any applicable commercial licenses or certificates, supply details about litigation (if applicable), and finally, add all your attachments listed above.

Your prequalification application is then submitted and you’ll receive email confirmation and details on how to submit your nonrefundable application fee.

Pro tip! See detailed instructions by application types on the state Resources page.

A prequalification application is good for two years from the prequalification date. If you won’t be ready for licensure by this deadline, you’ll need to submit a new prequalification application and pay the non-refundable application fee again.

Step 2: Licensure

Once all applicants have successfully achieved step 1 prequalification, the main applicant can submit the step 2 establishment license application. In this step, the CRA bets the proposed marijuana establishment.

The CRA will review:

  • Business specifications

  • Proof of financial responsibility

  • Municipality information

  • General employee information

Your physical establishment (dispensary) must also pass a CRA inspection within 60 days of submission of your complete application. This means you must have a location selected, purchased, renovated, and ready for inspection within 60 days.

You also must pass a Bureau of Fire Services (BFS) plan review within 60 days of application submission.

Pro tip! Do not submit your application until the location is ready for the CRA and BFS inspections. Failure to pass within 60 days may result in a denial of your application.

Before submitting your step 2 application online, collect all your documents. You must complete the application in its entirety. If you submit an incomplete application, you only have 5 calendar days to rectify the issue.

The following documents are required:

  • Attestations - there are 4 documents (attestations) you must submit PLUS a signed and notarized acknowledgement of attestations.

  • Business specifications -
    • Copy of Certificate of Use and Occupancy

    • Copy of deed or lease agreement

    • Copy of proof of financial responsibility (e.g., insurance policy)

    • Copy of marijuana business location plan

    • Copy of floor plan

    • Copy of business plan, including (but not limited to), your technology, marketing, staffing, and inventory and recordkeeping plan.

    • DBA documentation (if applicable)

    • Certificate of Assumed Name (if applicable)

To actually submit, you’ll log into the same system as the prior step. Click “Adult-Use Establishment Licensing” and “Create an Application.” Once you accept the disclaimer, you’ll be given options. Under “Adult-Use Step 2: License Application,” and select your license type.

You’ll then follow the prompts to add your entity contact information and details, including ownership, input municipality information, add number of employees, and finally, add all your attachments listed above.

Your application is then submitted and you’ll receive email confirmation that you successfully submitted the application. You’ll receive your license application number and application name.

See the full Marijuana Retailer Application Instructions.

Note: Getting a medical cannabis license in Michigan is a separate process, and has a different process from the above. Learn more about the Medical Marihuana Facilities Licensing Act (MMFLA).

Michigan social equity program for cannabis businesses

Michigan’s social equity program was created to help residents from disproportionately-impacted communities who want to enter the cannabis industry. The program provides resources to assist with the application process, and includes a fee reduction on all adult-use licensing fees.

Apply today

Find out if you qualify for Flowhub's Social Equity Program

Learn more about Michigan's social equity program and see if you qualify.

Note: You must apply for the social equity program before applying for a dispensary license.

Design your Michigan dispensary

Dispensary design isn’t just about where your dispensary is, or what it looks like. It’s how your shoppers experience your brand.

Dispensary store layout
Pictured above: The bank model – a common dispensary layout

Here’s a short list of your considerations in store design and layout:

  • How customers will move throughout the store

  • Whether they will pay at a terminal, handheld device, or kiosk

  • Whether there’s different pathways for in-store vs. online orders

  • How your products will be display/showcased

  • Your brand elements and design

  • Use of entry or waiting room space

  • Security concerns of doorways

  • Where secure inventory is stored (both on the floor, if applicable, and in a vault)

  • Where staff will stand and work

  • Breakroom or safe staff area

  • Bathrooms

Michigan also has a few particular requirements that may impact how your dispensary looks and functions:

  • Marijuana products and displays cannot be visible from a public place outside the establishment

  • Dispensaries are not allowed to sell food or alcohol at dispensaries.

  • Retail stores cannot allow marijuana consumption (unless they have a specific consumption license).

  • Cannabis delivery is permitted with specific approval from the CRA.

🤔🏬 Take the Store Layouts Quiz to find the perfect layout for your dispensary.

Create a safe and secure Michigan dispensary

Just like many states, Michigan’s regulatory agency has strict security requirements for licensed dispensaries. Here’s the basics:

Restricted access:

  • Anyone other than the licensee's employees must be accompanied by the licensee or an employee in limited access and restricted access areas within the marihuana business.

Secure locks:

  • Licensees must securely lock the entire marihuana business, including interior rooms, windows, and entry/exit points.

  • Commercial-grade, nonresidential door locks or electronic/keypad access must be used.

  • Egress doors must comply with NFPA 1, local fire codes, and Michigan building codes.

Alarm systems:

  • A licensee must maintain an effective alarm system at the marihuana business.

  • The agency can request information related to the alarm system, monitoring, and alarm activities.

Video surveillance systems:

  • A comprehensive video surveillance system is mandatory, including digital or network video recorders, suitable cameras, video monitors, digital archiving devices, and a color printer for still photos.

Surveillance system requirements:

  • The video surveillance system must record specific areas, including sales, storage, entry/exit points, and more.

  • Minimum resolution of 720p is required for clear imaging.

  • Cameras must be permanently mounted and strategically placed to capture relevant activity.

Lighting:

  • Adequate lighting must be maintained to meet video surveillance system requirements.

Motion detection and recording:

  • Cameras must record upon detecting motion and display accurate time and date information.

Secure storage:

  • Physical media or storage devices containing surveillance recordings must be secured to prevent tampering or theft.

Retention period:

  • Licensees must keep surveillance recordings for a minimum of 30 days, except when an agency investigation or inspection is ongoing.

Accessibility and inspection:

  • Agency inspectors must be able to immediately access and obtain copies of surveillance recordings upon request.

  • Licensees must provide copies of recordings to the agency as requested within the specified timeframe.

Failure notification:

  • A failure notification system for the video surveillance system is required, alerting the licensee to any interruptions or failures.

Log maintenance:

  • A log of recordings must be kept, including details about monitoring employees and any actions taken with recordings.

Learn the basics of dispensary security

Read the Dispensary Security Guide to find out where most dispensaries are at risk, then take action with best practices for both physical security and cybersecurity.

Hire and retain qualified dispensary employees

Now that you’re getting closer to opening day, it’s time to hire and train your dispensary employees. This team is vital to the success of your dispensary.

You will need to submit a general staffing plan during the application process, but now is when you fill out that plan and get started with hiring.

First, create an all-star dispensary org chart. Based on your business plan, location, store design, and vision, what role will you, as the owner, be playing in the day-to-day operations of the store? What additional staff do you need? What is the hierarchy? What benefits can you offer? And do you have the funds to pay your staff appropriately?

To start, you’ll need someone to manage the store, budtenders or cannabis sales associates to serve customers and fulfill orders, someone to greet your store visitors (and secure the entryway), security, and someone to manage inventory and/or compliance. Based on the size and complexity of your business, you might need more or fewer people on your team.

Be sure to understand your local laws around hiring and staffing and follow all requirements, both specific to cannabis brands, and general hiring/staffing rules. These could include procuring cannabis employment IDs, age requirements, background checks, and mandating attendance of certification training, payroll taxes, at-will parameters, and more.

How to create a dispensary org chart

Understand compliance

At this point, you should understand Michigan cannabis laws and what you need to do to keep your dispensary compliant.

As a reminder, here are the purchase limits for Michigan:

  • Adults 21+ can purchase up to 2.5 ounces of cannabis at a time, with no more than 15 grams of cannabis concentrates, from licensed dispensaries.

  • Adults over the age of 21 can possess up to 2.5 ounces total of marijuana.

  • Medical marijuana patients can purchase up to 2.5 ounces of cannabis per day, as long as they don’t exceed 10 ounces of medical cannabis in a single month.

The Seed to Sale Tracking program chosen by the CRA is Metrc. Metrc offers a wealth of education and training for new and prospective dispensary owners. We recommend attending those trainings and taking advantage of the Michigan-specific resources provided by Metrc.

To learn more about Metrc, including how to report to Metrc, the difference between plant and package tags, making sense of Metrc receipts, managing inventory, and more, consult these resources:

Source and intake cannabis products

Now’s when things really start getting fun: ordering and receiving your product! If you’re not a vertically-integrated company, or only have a retailer license, you’ll need to find cannabis growers, manufacturers, and/or distributors to supply your store.

As you’re looking for suppliers, here’s a few things to consider:

  • What products they carry (think about your product mix)

  • The taste and quality of the products

  • Fulfillment (how do they get products to you and when)

  • Prices (and ability to negotiate bulk discounts)

  • Testing processes and results

  • Reliability (will they run out suddenly, stop communicating, etc.)

  • Process for placing orders and overall organization

You also want to ensure your suppliers are licensed facilities, and in good standing with the state.

Packaging and label requirements

Michigan has a few specifications for cannabis product packaging and labels.

Here’s what you need to know:

  • Edible marijuana-infused candy in packaging that is attractive to children is not allowed. You cannot have any sort of cartoons, caricatures, toys, designs, or shapes. This includes things as simple as the picture of fruit on fruit-flavored gummies.

  • Packaging must be opaque, resealable, and child-resistant.

  • The following warning must be printed in clearly legible type and surrounded by a continuous heavy line: WARNING: USE BY PREGNANT OR BREASTFEEDING WOMEN, OR BY WOMEN PLANNING TO BECOME PREGNANT, MAY RESULT IN FETAL INJURY, PRETERM BIRTH, LOW BIRTH WEIGHT, OR DEVELOPMENTAL PROBLEMS FOR THE CHILD

Inventory intake

Once your cannabis products arrive, you must “intake” them into your store in a specific way to remain compliant with Metrc. Before you can bring physical inventory into your store, you must receive and review a manifest. The manifest is created by the supplier — which will either be you or other cannabis companies.

The manifest includes the harvest, weight, unit of measure, cost, etc. of the product.

You must review the manifest, and if everything is correct, accept it. When the package comes in, you'll physically inspect the package, and make sure it’s exactly as ordered.

You then accept it in Metrc, which tells Metrc that you are in legal possession of this inventory.

Now you can stock your shelves and sell the product. But you’ll also need to develop SOPs for intaking and auditing your inventory.

Pro tip: Use this 📝 Inventory Intake SOP to document your processes!

Choose your network, hardware, and cannabis tech stack

Your technology stack is crucial to success as a cannabis business owner. Some are must-haves for compliance, like your security system and cannabis point-of-sale, while others are vital to a pleasant and seamless customer shopping experience.

Here is a short list of technology solutions to consider for your dispensary:

  • Network

  • Hardware
    • Printers (both letter-sized and receipts)

    • TVs

    • Cash drawers

    • Computers (for staff work, like inventory)

    • Tablets or terminals

    • Barcode scanners

  • Software
    • POS

    • Ecommerce

    • Payment provider for non-cash transactions

    • Digital menus

    • Kiosks

    • Loyalty programs

    • CRM

    • HR/Payroll tools

    • Accounting software

    • Analytics tools

    • Social media management and monitoring

    • Website

You don’t need to invest in every cannabis-specific technology solution, but make sure you’re investing in tools that will help you stay compliant, and enable you to better reach and satisfy modern shoppers.

cannabis technology

📖 Read the Guide to Cannabis Tech Software for a complete list of top cannabis companies for your dispensary tech stack.

Market your dispensary

Ok, your store is ready, the team is trained, and technology is purchased and onboarded. Now you need to get the word out that your dispensary is opening soon.

Cannabis businesses notoriously have more challenges with marketing than traditional brands because of stigma, regulations, and the federal illegality of cannabis. But there are still many marketing tactics you can use to promote your new dispensary.

  1. Develop a beautiful, functional dispensary website. Enabling online ordering through your website is a great way to appeal to digital-friendly shoppers.

  2. Fine-tune your social media presence (though be careful with what you post!).

  3. Develop a rewarding loyalty program, focus on product-based SEO.

  4. Consider events to attract new customers into your store.

Note: Any advertising or promotions must include this warning: For use by individuals 21 years of age or older only. Keep out of reach of children. It is illegal to drive a motor vehicle while under the influence of marihuana. National Poison Control Center 1-800-222-1222.

Thinking about other forms of advertising? Cannabis or cannabis-related advertisements in Michigan must not:

  • Engage in false or deceptive advertising

  • Directly or indirectly target individuals under the age of 21

  • Contain cartoons, caricatures, or imagery or shapes that appeal to minors.

  • Engage in public advertising, such as from billboards. (However, anyone who has driven a highway in Michigan knows that dispensary ads are prolific.)

  • Advertise on TV, radio, online, or print advertising, unless there is reliable evidence that 70% of the audience is expected to be over 21 years of age.

How to choose a cannabis retail POS system

Deciding which point of sale system to work with is critical for both your success and sanity in the long run.

Why? Because every POS is different and yours has to work with your business.

Here are 10 tips for choosing marijuana retail software.

Flowhub cannabis point of sale for Maryland

What to look for in a cannabis POS:

  1. State compliance tracking: Metrc (and the other state reporting systems) is why software is so important. Having an API integration that manages this all seamlessly is paramount to save you time and provide peace of mind that you’re staying compliant.

  2. Hardware compatibility: As mentioned above, make sure the software and hardware you choose are compatible. Pick a cloud-based software that doesn’t restrict hardware options so that you don’t incur any additional hardware costs or have to change hardware if you change point of sale systems later.

  3. Customer support: Your ability to get up and running quickly is important, but getting your questions answered long-term is just as vital. As you demo different software, ask about the ongoing support process and level of support you’ll receive.

  4. Ease of use: Software that fuels your medical marijuana or adult-use retail stores must be easy and intuitive. Staff need to be able to learn it quickly. As you demo different POS systems, pay attention to how the system functions and whether you think it’ll make your staff more productive.

  5. Inventory management: Strong inventory capabilities will keep you compliant and competitive. Similarly, look for software that makes auditing easy, like having a mobile app. The right software will save you time and money in the long run.

  6. Built-in compliance: Software isn’t just important for compliance related to state reporting (like Metrc), it also should help you stay compliant with state marijuana laws, such as purchase limits. Make sure the software you choose has built in safeguards that address your market-specific needs.

  7. Discrepancy reporting: Your Metrc inventory, physical inventory, and point of sale inventory should always be aligned. If there is a discrepancy, you need to know about it and how to resolve it. Your software should include built-in tools to help you identify and resolve inventory discrepancies.

  8. Activity tracking: In an industry with more loss and theft than the average, it’s important that you can see who has done what activity at your store. This allows you to see what employee made what actions, and when those actions occurred, like making a sale, opening a drawer, moving inventory, etc.

  9. Open API and integrations: Is the software compatible with other vendors? It’s important to consider integrations, especially if you’re interested in online menus, delivery, loyalty programs or other technology offered by partners.

  10. Specialization: Consider the best software for each part of your business. If you have marijuana cultivation facilities, manufacturing facilities, and cannabis retail operations, it’ll be tempting to pick one software for it all. Better visibility is tempting — you can’t deny that — but all software is best at one thing. If you choose one for all, it means you’ll be putting the other two parts of your business at a disadvantage. Instead, look for vendors who integrate seamlessly.

    Need help opening your dispensary?

    Opening a dispensary in Michigan is quite an accomplishment. The market is still growing rapidly, and you’ll be in great company!

    If you have any remaining questions about opening a dispensary in Michigan, our team of cannabis retail experts would be happy to support your journey

    Book a meeting with Flowhub to chat!

    Amber erickson

    Amber Erickson

    Amber's goal is to create helpful and engaging content to empower cannabis professionals to run a successful and compliant dispensary. Connect with Amber on LinkedIn.

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