How to open a Dispensary in Arizona

In November 2020, Arizona passed Proposition 207, which legalized recreational marijuana for adults 21 years and older. Previously the state legalized medical marijuana for qualifying patients, marking a pivotal moment in Arizona’s history.

The medical marijuana program listed qualifying conditions that included cancer, glaucoma, HIV/AIDS, severe and chronic pain, severe nausea, seizures, post-traumatic stress disorder, and more.

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    What marijuana/cannabis businesses can you start in Arizona?

    The Arizona Department of Health Services licenses those who want to process, produce, test, and/or sell cannabis. Arizona dispensary licenses include a license for cultivation and processing. As of 2021, there are 125 dispensaries operating in the state of Arizona and a total of 143 licenses. The number will reach 169 once the state adds social equity licenses.

    Cannabis businesses can you start in Arizona
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    Arizona currently licenses:

    • Retail marijuana stores
    • Marijuana product manufacturers
    • Marijuana cultivators
    • Marijuana distributors
    • Marijuana extraction services

    How large is Arizona’s marijuana market?

    As of November 2015, Arizona had over 86,000 medical cannabis users, 77% of which are registered as chronic pain patients. In 2016, the state-approved additional patients for the cannabis program, bringing the total number to nearly 115,000.

    Also in November 2015, dispensaries sold 3,400 pounds of medical marijuana and an additional 300 pounds of other medical marijuana products. In November 2016, Arizona voters decided against a ballot initiative proposing a recreational marijuana program (51%).

    Arizona is frequently referred to as one of the fastest-growing major marijuana markets in the United States. By the end of 2014, the state’s market jumped to nearly $155 million. It continued to grow and is now considered one of the top ten marijuana markets nationwide.

    Owner requirements

    Arizona’s law allows counties and cities to set rules for both growers and sellers, including banning them if they choose. Before you open a marijuana business in this state, be sure to check the local laws.

    License requirements

    License requirements
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    Individuals that apply as board members for a marijuana business license must prove they have been Arizona residents for at least three years before the date of application. You also cannot be professionally affiliated with more than one dispensary. In other words, you risk problems with the Department of Health if your name is listed on more than one dispensary registration certificate application for a CHAA or more than five dispensary registration certificate applications.

    Medical dispensaries are required to employ an Arizona-licensed doctor on staff. To ensure proper allocation of dispensaries throughout the state, the ADHS will prioritize licensing in counties where a dispensary registration certificate does not exist.

    Financial requirements

    The answer to that depends on many factors including location, dispensary size, and the quality of products sold. Here is a breakdown of the application and licensing fees you may have to pay if you want to open a cannabis business in Arizona.

    • Dispensary Registration: $5,000
    • Dispensary Registration renewal: $1,000
    • Change of Location of Dispensary: $2,500
    • Change of Location of Cultivation or addition of cultivation site: $2,500
    • Dispensary Agent Registry Identification Card: $500
    • Dispensary Agent Registry Identification Card Renewal: $500
    • Amendment or Change to Registry Card: $10
    • Replacement Registry Card: $10

    Applicants must also have at least $500,000 worth of capital as well as a proposed location.

    How much does a dispensary make?

    Arizona is often called one of the fastest-growing marijuana markets in the country. It is not unreasonable to expect to make up to millions in this state. Just remember to save up for at least a year while you take the necessary steps to get your business running.

    Links to consulting companies

    Looking to start a marijuana dispensary in Arizona? The consulting companies listed below provide a wide range of services from helping with state licensing requirements and applications to running and stocking your business.

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