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How To Open a Dispensary In Arizona (AZ)

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In 2010, Arizona passed Proposition 203 also known as Arizona Medical Marijuana Act (AMMA) making it the fourteenth state to legalize medical marijuana. The AMMA allowed the Arizona Department of Health and Services (ADHS) to issue licenses for potential business owners who intend to open non-profit medical marijuana dispensaries. State-licensed dispensaries may cultivate, manufacture, deliver and sell marijuana or related products to qualified patients and caregivers.

In 2020, up to eight new dispensary licenses may become available based on the projections made by the Department of Health & Services (DHS).

Below is a detailed overview of how to start a medical marijuana dispensary, which also cultivates, manufactures, and delivers medical marijuana in Arizona. If you’re serious about this, you should check out the How To Get Started In The Medical or Recreational Marijuana Industry package to understand everything you need to know and do, from start to finish, to make this a reality.

Setup Your Marijuana Business Corporate Structure

You need to form your cannabis company on a not-for-profit basis. The bylaws must contain provisions relative to the disposition of revenues and receipts to establish and maintain its nonprofit character.

A registered nonprofit medical marijuana dispensary need not be recognized as tax-exempt by the Internal Revenue Service(IRS) because it is not currently possible and the company is not required to incorporate it as a cooperative marketing association.

Find a Compliant Location

You’ll need to find a compliant business location that meets the state, county, and city zoning regulations. This is one of the biggest make-or-break items that will directly impact whether you will get licensed, so you need to ensure your property will meet all zoning regulations.

Write a Marijuana Dispensary Business Plan

You are required to include in your application packet a dispensary business plan demonstrating the on-going viability of the dispensary on a not-for-profit basis that includes:

  • Description of total expenses incurred to establish the dispensary
  • Description of total tangible assets received for operating the dispensary
  • Projected expenses before and after the dispensary are operational
  • Projected revenue

Our Medical Marijuana Dispensary Business Plan includes all of these details (and more) so you can save time and money and ensure this requirement is taken care of by professionals who’ve gotten approvals in every major cannabis market.

Acquire a Dispensary Registration Certificate

Here are the application requirements for receiving a Dispensary Registration Certificate:

Owner Requirements

  • None of the principal officers or board members has been convicted of an excluded felony offense.
    – None of the principal officers or board members has served as a principal officer or board member for a registered nonprofit medical marijuana dispensary that has had its registration certificate revoked.
    – None of the principal officers or board members is under 21 years of age.

License Application Requirements

  • Legal name of business also known as the corporate entity
  • Physical address of the dispensary and cultivation facility
  • Name, address, and date of birth of each principal officer and board member
  • Name, address, and date of birth of each dispensary agent
  • Operating procedures that include Inventory Control; Qualifying Patient Recordkeeping; Security; Patient Education
  • If the city, town, or county where dispensary will be located has enacted zoning restrictions and a sworn statement certifying that the registered dispensary is in compliance with these restrictions.
  • Dispensary by-laws
  • A business plan demonstrating the on-going viability of the dispensary on a not-for-profit basis

Financial Requirements

  • $5,000 application fee
  • $1,000 annual renewal fee
  • $150 dispensary agent registry fee
  • $150,000 start-up capital (evidence must be dated within 30 days of the date of the application)

Acquire a Dispensary Approval to Operate

After obtaining a Dispensary Registration Certificate, you have 60 days to submit an application for a Dispensary Approval to Operate that includes:

  • Building occupancy permit

Install Operations Infrastructure

Now that you’ve submitted your applications for starting a medical marijuana dispensary in Arizona and once your license(s) have been issued, it’s now time to start hiring people, buying equipment, and setting up your dispensary policies and procedures to ensure legal compliance and smooth operation.

Market Your Marijuana Dispensary

Your dispensary will live or die based on how well you market it to the public. There are some major pitfalls and hurdles you’ll have to overcome in order to do this legally and effectively. Marijuana businesses no longer sell themselves, so you’ll need to ensure you’ve got a great Marijuana Dispensary Marketing & Advertising Plan in place to ensure success.

Pay Taxes & Renew Licenses

Pay all applicable taxes and be sure to renew your Dispensary Registration Certificate 30 calendar days before the expiration date and pay a renewal fee of $1,000.

That’s it! Hope you find this article helpful and will give you a good opportunity of opening a successful dispensary.

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