The medical cannabis industry in Delaware is growing, thanks in part to new laws that make it easier than ever to learn how to open a dispensary in Delaware. Easier, but that doesn’t mean the process is fast or simple.
For those who are looking at the benefits of opening a dispensary in the state, it helps to have a bit of help. For the most up-to-date information work with a professional consulting firm like MOST to set up a dispensary in the state. If you want to learn how to do so yourself, consider the process below.
House Bill 2 and Updates to the Licensing Process
The cannabis industry has the opportunity to grow significantly thanks to the state’s recent approval of the Delaware Marijuana Control Act.
In 2011, Delaware took the step to create a medical access program for qualified patients, a program that, as of fall of 2033, had more than 29,000 patients enrolled within it, according to the Delaware Department of Health and Social Services. In 2023, the state took steps to make cannabis legal for medicinal and recreational use within the state. The latest law puts in place strict requirements to allow for the creation of dispensaries in the state.
With the state's allowance of dispensaries comes a set of steps all business owners must follow if they want to sell cannabis products. On August 19th, 2024, the state’s recreational marijuana business online application process began. This process will enable individuals to apply to join the recreational cannabis industry.
After an initial period, the state will use a lottery to determine which eligible applicants will be allowed to receive a license. Licenses will then be issued in November of 2024. The state will formally allow for the following dispensaries and licenses to be offered in the state:
- 60 cultivation facility licenses
- 30 product manufacturing facility licenses
- 30 retail store licenses
- Five testing facility licenses
Microbusiness Licenses
Opportunities for microbusiness applicants will also be available at the county level. A microbusiness will be 51% owned by one or more people who live in the state (and have done so for at least the previous five years) and cannot employ more than ten people. It cannot operate a facility with a canopy larger than 2500 square feet. Also, these micro-businesses may not possess more than 1000 plants each month.
Social Equity Cannabis License
The state will also issue a small number of social equity licenses on a county level. These licenses require that 51% of the ownership of the business is in the name of one person or several people who live in the state and have done so for the previous five years in a disproportionately impacted area. They also are available to those who have been convicted of a marijuana offense or is married to or the child of a person who was convicted of such an offense in the past.
With only 125 dispensary licenses available in the state, there will be some competitiveness to obtain one.
The Controlling Authority in Delaware for Cannabis Licensing
How to Apply for a Dispensary License in Delaware
There are several key criteria the state will consider for dispensary licensing in Delaware. Consider the rules set by the OMC:
- A business plan: The license applicant must provide a comprehensive business plan. That plan must include an annual budget for the business and pro forma financial statements.
- Experience: The applicant must demonstrate experience and training, as well as expertise in the industry. Both the applicant and any managing officers must meet these expectations.
- Safety plan: The state also requires that every business submit a comprehensive safety and security plan for their business and the prevention of diversion.
- Environmental plan: Organizations will also need to demonstrate their environmental and sustainability plans for reducing environmental impact and resource use (such as reducing water usage and cultivating organically)
- Operational plans: Each applicant must submit a comprehensive plan for operations, training, and staffing for their business. Quality assurance measures must also be put in place and completely outlined.
The complexity of completing a dispensary license is significant. Working with a consulting firm like MOST is recommended to avoid missteps that could lead to ineligibility of a license when they finally start to be released.
Delaware Cannabis Licensing Fees
The following cannabis licensing fees will be applicable:
- All establishments: $5,000 non-refundable fee for all establishments, a $1,000 fee for social equity, and a $3,000 fee for micro businesses.
- Retail license: Locations must obtain a retail license on a biennial basis at the rate of $10,000.
- Cultivation license: Those planning on cultivating products must obtain a cultivation license at the rate of $2,500 to $10,000, biennially determined by the canopy size.
- Manufacturing: Companies engaging in cannabis product manufacturing will require a $10,000 biennially fee
- Testing: Companies providing testing services will have a $10,000 biennially fee
Delaware Cannabis Industry Timeline
The MCO put in place a plan for when it would roll out each component of the cannabis industry plan. Here is a look at those specific steps:
- July 2024: The adoption of regulations for the administering of licensing for recreational marijuana was set.
- September 2024: License application acceptance starts (the state announced this would begin August 19th, two weeks early)
- November 2024: The cultivation facility license issuance would be released, allowing up to 60 cultivation facilities in the state.
- December 2024: The product manufacturing license issuance would take place, allowing up to 30 product manufacturing licenses.
- March 2025: Retail and testing facility license issuance will begin to allow for 30 retail locations and up to 5 testing facilities.
Working with a Cannabis Application Consultant
With the framework of how to open a dispensary in Delaware in place, there will be a significant number of organizations working towards acceptance. However, the process takes much more than just filling out an application.
If you want to learn how to apply for a dispensary license in Delaware comprehensively, so that there is no risk that you miss out on the lottery due to missing or inaccurate information, seek out the help of a consulting firm.
Application and Launch Strategy Support
Creating an application and launch strategy is critical. By working with a professional consulting firm like MOST, you create an opportunity to be one step ahead of the competition, which means being ready to launch your business as soon as possible.
If you are considering opening a dispensary in Delaware, turn to MOST for the guidance and support you need to ensure the process goes well. Contact Us to learn how to do so with confidence.
