Delaware’s Cannabis Market Is Open — Are You Ready?

Updated Business Guide For Delaware Cannabis License Holders

Earlier this month, Delaware officially opened its adult-use cannabis market, marking a major milestone in the First State’s cannabis legalization efforts. This was a “strong start” to the adult-use market which saw the inaugural three-day weekend have combined sales of over $903,000, $625,000 of this coming from adult-use sales which corresponds to an estimated $93,750 in tax revenue for the state.

We recently published a separate business guide preparing individuals following the cannabis lottery in October 2024,  and now, with license lotteries wrapped and the market up and running, let’s expand on this and see what you can do, what you should do, and what options are there for those without a license but still want to be part of the cannabis market in Delaware.

 

What Delaware Cannabis License Holders Can Be Doing

Finalize Business Planning and Financial Modeling

Right now, one of the best things that cannabis applicants can do is ensuring the financial and business viability for their prospective operations. An often-overlooked aspect with preparedness for cannabis businesses success is ensuring that the benefits outweigh the costs and knowing (in detail) what the costs actually amount to. If you’re looking for a lender or an angel investor or additional partner, business planning and financial modeling should be done. With a proven background in both cannabis business development and cannabis financial strategy, Canna Advisors can better position you for success and ensure your business gets off the ground and running.

 

What Delaware Cannabis License Holders Should Be Doing

Understand Your Timeframe and Deadline to Convert Conditional Licenses

What individuals can be doing and should be doing are different and can vary based on individual needs. But there are some requirements that everyone seeking financial licensure in Delaware should be doing. For starters, businesses have eighteen (18) months to convert from a conditional license to a fully operational cannabis business. Individual businesses in this phase will need to begin compiling all necessary documentation such as zoning approvals and finalized business plans to highly detailed Standard Operating Procedures (SOPs) covering everything from adverse event reporting to secure transport.

Secure Real Estate

The first thing license holders will need to do is secure a property. Whether this is through a lease or purchase agreement, individuals will need to have documentation of site control and identify a cannabis friendly local government, which can be challenging. With this, zoning will need to be secured for your respective cannabis business type and operations (as zoning requirements vary for cultivation or retail, for example).

Draft Standard Operating Procedures

The next step will be then to draft compliant cannabis SOPs which will need to be submitted to the Delaware Office of the Marijuana Commissioner (OMC). These documents will need to be tailored for your business license type—cultivation, manufacturing, retail, or testing—to meet Delaware’s regulatory requirements for cannabis. Business ownership details and entity structure, along with financial stakeholders, will need to be disclosed and vetted, including any and all background checks.

These are essential steps for conditional license holders and must be done quickly. Again, eighteen months may seem like a long time, but time goes by quickly and it’s critical to get into the supply chain early so you can tap into that lucrative first mover advantage.

 

No License? How To Still Get Into Delaware’s Cannabis Market

Business Opportunities Exist But Come With Risks

But what about folks who aren’t at the conditional license phase but still want to get into the Delaware market? Luckily, there are still ways to be involved in the Delaware cannabis industry. While there are plenty of opportunities to be had in cannabis, there are also plenty of pitfalls and obstacles too. With the right skillset and/or financial backing, you can look at joining a team with conditional license approval or even “buying” a license.

Transfer of Ownership Can Offer A Path

There is much more detail we can go into with this last step, but one of the easiest and most often overlooked aspects with cannabis licenses is the transfer of ownership and control of a license to someone else. Around 50% of cannabis retail license holders never open up and less than 25% are profitable. What can you do to avoid this and actually get up and running? Inviting people to the team, building out the best possible network, following state and local requirements, and consulting with the experts on your specific business needs.

 

License Or No License: Canna Advisors Can Help

Canna Advisors is here to help with all of your Delaware cannabis business development needs from pre-license (or no license) to business launch and operational expansion. With decades of cannabis consulting expertise across the Northeast and beyond, our team has an consistent, active pulse on the industry to help streamline license wins and business success.

Contact our experts or book an hourly consultation to get started today.