How to Open a Dispensary In New Jersey

Despite the approval of the Marijuana Legalization Amendment by voters during the general elections in November 2020, the recreational cannabis industry in New Jersey remains in limbo. The Cannabis Regulatory Commission (CRC) is yet to fully approve any of the license applications it has received since the first wave of applications — targeting cultivators, manufacturers, and testing labs — began in December 2021. 

The regulatory body began accepting recreational cannabis retail license applications on March 15, 2022. Although businesses are eager to start retail operations, the CRC insists that operations will only commence when applicants have met all the legal requirements and regulations for license approval.

For any cannabis entrepreneur looking to venture into the New Jersey market, it is important to understand the steps that need to be taken to open a dispensary in New Jersey. 

Can I open a dispensary in New Jersey right now?

Although current legislation permits the sale of both medical and adult-use cannabis in New Jersey, the CRC is yet to approve adult-use cannabis retail licenses.

Prior to the formation of the CRC, all medical marijuana business license applications were handled by the New Jersey Department of Health. Now, however, ATCs are expected to apply for dispensary endorsement permits through the CRC to allow them to dispense marijuana to patients with qualifying conditions, although the state is not accepting applications right now

How do I open a cannabis dispensary in New Jersey?

Although the recreational cannabis market is in limbo, awaiting the green light from the CRC, you can still remain ahead of the curve by following the following steps on how to open a cannabis dispensary in New Jersey:

Check eligibility criteria.

Look up the eligibility criteria to assess whether you can open a dispensary in New Jersey. Residents who are 21 and above can apply for a business license as individuals or as part of a partnership. At least one of the major partners in the business must have lived in New Jersey for at least two years by the date of license application. The applicant(s) must meet all the requirements put forth by the CRC regarding application fee payments, public health and safety standards, and industry practices. Additionally, the owners, directors, and other employees must undergo a criminal history record background check.

Look at local cannabis restrictions and laws.

Many towns in New Jersey have prohibited cannabis sales. It is therefore important for you to have an understanding of the local regulations on cannabis retail before you set up shop. Ensure that your location of choice is in compliance with state and local zoning laws.

Formulate a business plan.

Your cannabis business plan should include an executive summary, your target market, your marketing plan, your financial plan, and information on staffing and real estate requirements. A good business plan is key for securing funding for your dispensary, and is also required as part of your application for the license.

Acquire appropriate dispensary technology.

The right dispensary technology will help streamline daily dispensary operations like sales, inventory management, and security. Inventory management software, POS systems, integrated payroll systems, and security systems are some key technologies your dispensary will require for smooth operations.

Apply for a cannabis retail license.

After completing the above steps, you can then begin the process of applying for a cannabis retail license from the CRC.

What are the current cannabis laws in New Jersey in 2022?

The current legislation on cannabis in New Jersey states that:

  • New Jersey residents who are 21 and above, with valid government-issued ID, may possess up to 6 ounces of cannabis.
  • Adult medical patients with qualifying conditions may carry up to 170g of marijuana at a time.
  • All legal cannabis in the state will be grown at a state-licensed cultivation facility. Home cultivation of cannabis is prohibited and punishable by law, as before.

What type of cannabis retail license do I need to open a dispensary in New Jersey?

The CRC has classified the different cannabis business license types according to their roles in the seed-to-sale cycle. To open a dispensary in New Jersey, you will require a Class 5 Retailer License, which will allow you to obtain cannabis and its products from cultivators, processors, and wholesalers, and sell these to consumers in a dispensary.

How do I get a cannabis dispensary license in New Jersey?

Currently, license applications are being received via the CRC website. To ensure equity, initial application fees are low, and only successful applicants will be required to pay the full application fee. The CRC license fees schedule is as follows:

For medical marijuana, an ATC certification fee ranging from $100,000 to $1,000,000 depending on the degree of vertical integration and number of dispensaries will be charged annually. 

How much does it cost to open a dispensary in New Jersey?

The cost of opening a dispensary in New Jersey consists of the following expenses:

  • Application and license fees
  • Real estate costs
  • Dispensary technology and infrastructure
  • Payroll
  • Inventory costs
  • Marketing costs
  • Taxes

On average, you should expect to spend anywhere between $600,000 and $2 million in your first year of operating a dispensary in New Jersey.

How can you keep your dispensary compliant in New Jersey?

To ensure your dispensary remains compliant, the state will require you to:

  • Track and trace all your cannabis products for regulatory reporting requirements
  • Clearly identify the source of each ingredient with date of receipt, vendor’s name and address, name of the ingredient, etc.
  • Include the vendor’s batch number, lot and control numbers of the product, and the product’s grade and quantity in inventory reports

This can all be done with compliant inventory management software and dispensary POS systems.

What is the track and trace technology used in New Jersey?

In January 2022, the state of New Jersey announced that it would be partnering with Metrc as its official cannabis monitoring system. We shall update you with further details on this partnership as they arise.

If you want to learn more about opening a dispensary in New Jersey, download our free guide!

how to open a dispensary in new jersey

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