California’s Adult Use Cannabis Program

On November 8, 2016, California voters passed Proposition 64 – The Control, Regulate and Tax Adult Use of Marijuana Act. The proposition became law immediately and permits adults 21 years of age and over to possess and grow specified amounts of marijuana for recreational use. It does not alter the Compassionate Use Act (Prop 215) or the Medical Marijuana Regulation and Safety Act.

For the most up to date information on California rules and regulations visit http://www.bmcr.ca.gov

Now Preparing Recreational California State Marijuana Business Applications. Interested in Applying?

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How to Start a Cannabis Business in California

California boasts the sixth largest economy in the world, with over 39 million people currently residing in the state. Whether you are an existing operator or new to the industry, California’s market is extremely competitive so it is best to start immediately.

Existing Operators

As a practice, the state will only license entities who can demonstrate the ability to comply with all local and state rules and regulations, regardless of their previous industry success:

  • Compliance: Now is the time to start adapting your standard operating procedures, labeling and packaging, and record keeping to comply with the new rules. Other businesses will be prepared for the deadline, so you should not make the mistake of waiting until the last minute to adapt. It could mean the difference between getting the license and closing your doors.
  • Organization: Regulators will look to license businesses who submit well-structured applications.  comprehensive business plans, detailed financials, historical sales data and licensing, information about individuals in the executive structure, demonstration of good practices via established operating procedures and record keeping, in addition to other specialized information about your business.
  • Transparency: Regulators will want to see all aspects of your business within hours of a request. Ensure that your sales data, inventory reports, tax information, licenses and permits, and employee and/or patient records are immediately available for recall, for your own business safety.

New Operators

As a practice, the state will only license entities who can demonstrate the ability to comply with all local and state rules and regulations, regardless of their previous industry success:

  • Location: Finding a viable location that meets all of California’s requirements will take not only time and planning, but also capital. Some towns have bans, others have license caps and some are so overly populated with cannabis businesses that it will be hard to stick to the 1000 foot rule.
  • Team:The talent you engage for your organization will be an important component regulators will consider as they review your application.
  • Capitalization: In order for a cannabis business to succeed, your business must have access to a significant amount of funding. It is a common misconception that cannabis businesses will generate enough revenue at inception to negate the need for substantial funding.
  • Organization: In addition to intensive scrutiny of team members and financing, regulators will look to license cannabis businesses who submit well-structured applications, which include: comprehensive business plans, detailed organization charts, compliant facility design, built-out security plans, sophisticated financial models in addition to other specialized information about your business.

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