How Much Does a Dispensary Owner Make?

If you've wondered how much a dispensary owner makes, you would not be the first or the last. In response to the phenomenal boom in the cannabis dispensary business, there has been increased interest in starting a dispensary and the potential profits a dispensary owner can make. If that's you, then this article is a perfect read.

In this article, we will explore those questions, as well as how much budtenders make, how much a franchise dispensary owner makes, and how much average dispensary profits owners can expect. We will also cover the cost of operating a dispensary, expected profits, and how much profit a typical dispensary owner makes. Let's dig in.

If you want to dig even more about dispensaries' business, planning, and success, then, this complete guide on how to open a dispensary is all you're looking for.

How much does a dispensary owner make?

Dispensary owners make an average salary of between $250,000 and $500,000 yearly from running a dispensary, with a small percentage making up to $1,000,000 a year. The average dispensary produces around 2M in sales yearly with a 12% profit margin. 


We pulled those numbers from a survey done by MJBizdaily; and Statistia's annual report.


With those metrics in mind, it's no wonder a dispensary owner occupies one of the top-tier positions in the cannabis retail business. But it isn't just a matter of raising capital for the company and setting up its administration. A dispensary owner will have to sacrifice time and a lot of money if they make the dispensary work.


There are many loopholes for dispensaries to pass through and legal hurdles to jump over every single day. The dispensary owner bears the weight of that responsibility and does everything to keep the business operating smoothly. 


Suppose you feel drawn to the opportunities that come with owning a dispensary. In that case, you also need to be aware of the many responsibilities that go with it—especially when it comes to getting a license and setting up initially. So it might pay to learn how profitable most dispensary's typically are, after expenses.


How profitable are dispensaries?

Dispensaries are, for the most part, a very profitable business.  Studies have shown that up to 90% of dispensaries have reported having good to significant revenue in the past year, with an average 12% profit margin after tax and an average of 2 million in sales annually.

How Much Does a Dispensary Owner Make?


Of course, there are several factors to take into consideration when talking about profitability. The size and the location of the dispensary matter. A small dispensary located in a town with little customer traffic will make a profit but not in the same league as a major distributor dispensary that serves thousands and even tens of thousands of customers.


Other important dispensary costs to consider include:

  • Taxes
  • Licenses
  • Daily transactions
  • Operating Costs
  • Labor Costs
  • Product Costs

What is the yearly cost of operating a dispensary?

The average cost of operating a dispensary is between $200,000 to $1,000,000 each year. But much of the operational cost depends on the size of the business outlet. A cannabis dispensary is not the same as your regular Walmart shop—the prices are far higher than what is required to open a simple retail shop. With that said, you might be interested in knowing specific cases about opening dispensaries, like this guide about how to open a dispensary in California.

As with all businesses, there are necessary operational expenses that must come with running a dispensary. These costs begin at the point of application and licensing, which can be as high as $200,000. Indeed, in some cases, this fee is not refundable.

That can be a lot to process. There are other specialized legal licenses that dispensary owners are required to pay for and adhere to, not to mention the day-to-day operational costs of running the dispensary.

Daily costs can run to thousands and even tens of thousands of dollars. Let’s not forget the cost of providing adequate security to keep the product secure.

After calculating the cost of paying your staff, 280E deductions, marketing, inventory, and operating costs like software, rent, and licensing, it is wise to work with an accountant versed in your world.

But the final numbers are in - on average, studies show that regulated dispensaries were running on annual operating costs of $1.2 million and had annual revenue estimated at $3 million.


How much does a dispensary franchise owner make?

Dispensary owners make an average salary of anywhere between $250k and $500k annually from running a dispensary. ‍ These statistics are based on the data that the average dispensary brings in around 2M in revenue per year with an average 12% profit margin.


If the weight of starting a dispensary from scratch isn’t something you are willing to bear, there is an alternative route many entrepreneurs are beginning to take. Like many businesses worldwide, you don’t have to get your hands dirty when you can acquire a franchise. 


Much of the success of some of the world’s largest companies has come from understanding and utilizing the power of franchising. The cannabis industry is no different in this regard.


What do budtenders make?

The average budtender can earn between $12 - $18 per hour working at a dispensary.  Factors that could allow a budtender to make more include a more established dispensary, more experience, or the acquisition of additional budtender certifications or courses. 


Some budtenders may also make tips, or be offered sales bonuses or incentives but this all depends on the dispensary policies.

Because budtenders are the face of the business, and provide customers with information on the different cannabis products available at the dispensary they don’t have to be medically trained but will need a experience or proper budtender certifications that allows them to work a dispensary.

We can summarize the budtender’s responsibilities as follows:

  • Representing the dispensary as the first person customers interact with
  • Setting up the sale of any cannabis product
  • Providing useful information on the products available
  • Providing proper safety measures to customers
  • Verifying the identity of the customers and maintaining a sales database 
  • Operating the cash register

How Much Does a Dispensary Owner Make?  girl with tea

How can you increase profits at your dispensary?

The best way to increase your dispensary profits would be to focus on initiatives to lower costs like optimizing your processes and systems and intelligent ordering, initiatives to increase revenue like budtender training and incentives, and leveling up your knowledge and skills.


More ways to optimize your dispensary processes.

A powerful way to optimize your dispensary processes would be to invest in:

  • A good people management solution like KayaPush
  • Invest in an integrated POS solution
  • Invest in a good inventory management solution
  • Consultants and specialists
  • A good bookkeeper or cannabis accountant

Want to know more about the cannabis software everyone is talking about? 


Enter KayaPush. KayaPush manages your dispensary’s payroll, paperwork, scheduling, and HR processes, so you can focus more on creating the values and structures that will make your dispensary a memorable experience for your customers. 

Using a system like KayaPush, means you never have to worry about the paperwork or manual administrative tasks involved with running a cannabis retail store. You are also keeping your dispensary compliant.


Now that you know the answer to your question, "how much does a dispensary owner make" it might be time to take the plunge or scale up!


If you are looking to learn more about how to open or scale your dispensary, check out our free standard operating procedures checklist below!

Dispensary Standard Operating Procedures | How Much Does a Dispensary Owner Make?

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