Sell your cannabis products to dispensaries with the help of these six simple steps


Sell your cannabis products to dispensaries with the help of these six simple steps

With the growing popularity of the cannabis industry, everyone wants to be a part of the marijuana business in some way or the other. Over the past few years, several states in the United States have legalized cannabis for recreational or medical usage. This has led to substantial growth of medical and recreational marijuana dispensaries across the country. The first step to any Business is to make sure you are in good legal standing with your local and state guidelines. If you have not yet registered your cannabis business, check out this article to learn step-by-step how to set up your business.


Several factors like the increase in cannabis awareness among the public, growing legalization, and the high profitability of cannabis businesses have piqued the interest of experienced and new entrepreneurs alike! Many even succeed at making an entry in the cannabis industry but often get stuck at a question, "How can I get my cannabis products into dispensaries?" If this sounds like you, don't worry! We've got you covered.  


What is a dispensary?

Let us get into the process right from scratch. Although dispensary locations are heavily regulated by law, they are generally found inside a hospital, doctor's office, or retail shop. Dispensaries give cannabis consumers access to a wide variety of recreational cannabis products and medical CBD. These products are made available to them by cannabis cultivators or cannabis product manufacturers. A dispensary stocks a range of cannabis products such as concentrates, edibles, topical treatments, flower or bud, sprays, vape juice, to name a few. 


One can purchase cannabis or cannabis-related products for medical or recreational use from these dispensaries. However, customers need to register with the medical marijuana dispensary to buy from there. They also require a valid prescription from a doctor. On the other hand, recreational dispensaries only verify whether the consumer is over 21 years of age and making a legal purchase of their cannabis products. There is also a new kind of dispensary popping up at some places off late, which is an 'online-only delivery' service. This kind of dispensary (presently available in California) sells its cannabis products on the internet and delivers them directly to the client's location. 


Cannabis Cultivators

The products sold in medical or recreational dispensaries consist of concentrates or flowers extracted from marijuana or hemp plants. Hemp consists of Tetrahydrocannabinol (THC) less than 0.3%, and marijuana consists of THC of more than 0.3%. Both marijuana growers and hemp farmers come under the category of cannabis cultivators. 

Professional cannabis cultivators have a deep knowledge of cannabis and understand the nuances of growing a healthy crop for selling and processing purposes. If you want to become a cannabis cultivator, you need a cannabis cultivation license first. A degree in horticulture or botany may also come in handy. If you are looking solely at cannabis product manufacturing, you can buy cannabis from one of the experienced cannabis cultivators for your business. 


How do you sell cannabis to dispensaries?

Now that you know who cannabis cultivators are, what a dispensary is, and what kinds of dispensaries are coming up in the country, let us now look into the six steps to get your marijuana or cannabis products into these dispensaries


  1. Conduct thorough Market Research 

Extensive market research before giving the final shape to your product idea will be instrumental. Consider these three crucial aspects when performing your research.


The Demand – Supply Factor

Before you get into the costing, legalities, paperwork, and product manufacturing, be sure to conduct extensive market research. Maybe you have a unique product idea, but does it have a demand among the public? If not, is there a scope for the need to exist in the future? Will it be beneficial to your target consumers? Is there a gap in the current supply and demand ratio of dispensaries? These are some questions you must try to find the answers to. Other than just the market supply and demand factor, assess your competitors and their offerings too. 


Shortlisting the Product Segment

Some popular products include cannabis-infused edibles such as gummies and lollipops. If you are looking for a less risky venture with a fast-selling cannabis product, you can get into this segment. However, if you are looking for a unique product offering, you need to tap into the gaps in the cannabis market. For example, there has been a shortage of organic flowers and solventless concentrates in the market until recently. This gap can turn into a great business idea for upcoming cannapreneurs! 


Dispensary requirements

Don't make the mistake of considering all dispensaries' requirements to be the same. Every dispensary is likely to have its preferences for cannabis products. Some want only particular strains, while some want organic flowers. For example, marijuana products sold to medical dispensaries need to be more potent and of higher quality than recreational cannabis products.  


Every dispensary will have its very own bestselling product, fastest-selling product, and most unique product. Shortlist a few dispensaries you are interested in selling to. Knowing them better and building a relationship with them will go a long way for your business. 


Get on-call with each of your prospective dispensaries and ask them about their requirement. If possible, go and meet them in person to understand them better. Here are a few questions you must ask them:


  • How much THC content do you prefer in a marijuana product and medical CBD products for your dispensary?
  • What smells, colors and flavors of marijuana, medical CBD, THC products, and cannabis products do you generally accept?
  • Are you facing a shortage of a specific type of product, and which one is it?
  • What kind of cannabis products are in maximum demand at your dispensary?
  • How open are you to experimenting with new kinds of cannabis products?


  1. Get yourself a license


Yes, selling marijuana, even if it's to a dispensary, is a legal business activity. As with any lawful business activity you undertake in the United States, you have to be licensed to sell cannabis products too. Therefore, the first thing you need to have if you're planning on selling marijuana to a dispensary is a valid license for growing and selling marijuana.


However, note that the licensing requirements differ with each state across the country. Be sure to consult Dr. Google for the marijuana licensing requirements in your state before you start preparing your documentation.


  1. Hire a lawyer

It is a fact that both marijuana and medical CBD have only recently been legalized in most American states.  Strict rules and regulations are framed around cannabis because most states want to ensure that the marijuana and medical CBD will help heal people who need it and not fall into the wrong hands.  As a cannabis cultivator, processor, or product manufacturer, you will need to follow all the rules and regulations to sell cannabis products to a dispensary without finding yourself on the wrong side of the law. It would be wise to lawyer up if you're serious about selling marijuana and other cannabis products to dispensaries. This way, you will be well equipped to avoid any 'brushes' with the law that might come your way.


  1. Product Development & Child Resistant Product Packaging Design

It is now time to act fast on your unique product idea and work on its development. Even though this sounds like an easy task, it involves multiple stages and can be a long and tedious process. Processing, manufacturing, branding, and packaging are just some broad steps of the cannabis product development cycle that you need to ace before you can sell cannabis products.


Even if you are not a big cannabis corporate, you can always outsource your branding and design to companies with decent experience in the cannabis domain. This will accomplish your task faster and, at the same time, lend a professional look to your product and its packaging. 


Don't ignore the legal guidelines for cannabis packaging when selecting the packaging for your cannabis product. Whether you're selling recreational marijuana or medical CBD, its packaging must follow the prescribed state guidelines. Most states recommend child-resistant packaging for cannabis products. Choosing such packaging helps make marijuana safer for the people who use it and their families. Making a checklist of your state's packaging guidelines and labeling guidelines can help you in this process. 


  1. Pricing your cannabis product


Now comes a tricky question that you need to figure out an answer to. What price should you charge when you are ready to sell cannabis products to various dispensaries? Since you're selling a valuable product, you need to charge a fee that reflects its actual value. Also, remember that growing marijuana is expensive. Therefore, you need to charge the dispensaries a price that will allow you to continue to afford your trade. As a general rule, you want to make an average of 30% profit after deducting all expenses and the dispensary's taxes. Therefore, your markup should be 30%. Based on this, you can calculate a selling price for your cannabis product. 


In the United States, an entry-level grower stands to earn anything between $50000 to $100000 annually. But if crucial factors like the laws, location, and consumer demand are favorable for the business, they can make a better sum. The average grower makes approximately $260,000 on an annual basis once they are settled in the business. 


Keep in mind that different dispensaries will buy your marijuana or cannabis products at different prices. Until a few years ago, California dispensaries were purchasing cannabis for $1000 a pound on average. But this figure has steadily increased over the years in California and other states, owing to the growing demand and legalization of cannabis.


  1. Just pick the phone up and call!


This is the final step to get your fantastic cannabis products into that dispensary you have been prospecting. Building a relationship with dispensaries during your product development and market research phases will pay off now. 


Hearing a human voice can do the trick in this era of email, texting, and chat messaging. Yes, you can sell your medical CBD and THC products to your favorite dispensaries by approaching them over the phone with a complete briefing about your cannabis product. 


You can also send out email proposals to your prospective clients. Ensure that you mention precisely the cannabis product that you want to sell and its properties. If they like your product and concept, you don't need to search any further. And if your products strike a chord with the dispensary's customers, you have successfully managed to make your way into the shelves of the dispensaries.



Lastly, it would be helpful at all times if you chart out a detailed business plan and keep it handy with you. This business plan will serve as a roadmap and a guide for your newfound cannabis business, right from growing cannabis, processing it, packaging it and selling it to dispensaries. When your cannabis product gets accepted, stocked, sold, and reordered by dispensaries, consider that you are in for the big win! 

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  • Matthew Centeno