How to Open a Marijuana Dispensary in Massachusetts

By FindLaw Staff | Legally reviewed by Amber Sheppard, Esq. | Last reviewed September 29, 2023

This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw’s team of legal writers and attorneys and in accordance with our editorial standards.

The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area.

In 2016, Massachusetts became the first state on the east coast to legalize recreational marijuana businesses. Until then, Massachusetts only allowed medical marijuana from nonprofit dispensaries known as Registered Marijuana Dispensaries (RMD). Now, the Massachusetts cannabis market is booming with recreational use marijuana business opportunities.

 

If you want to start a business in the cannabis industry, you have options. You can become a marijuana cultivator and grow marijuana products, or open a recreational cannabis retail store or microbusiness. You can also apply to be an RMD or even run a marijuana lab with testing capabilities.

Massachusetts' cannabis laws carefully regulate all types of marijuana establishments. The application process for a cannabis business is now open to entrepreneurs looking to create a compliant business plan.

Cannabis Business Laws You Need to Know

The Massachusetts Cannabis Control Commission (the “CCC" or “Commission") regulates the Massachusetts marijuana industry and all cannabis licenses in the state. The table below outlines the ordinances, regulations, and laws you must know before opening a cannabis dispensary in Massachusetts.

Marijuana Laws

Important Massachusetts cannabis laws include:

Customer Regulations
  • Customers must be 18 years or older for medical use. If the customer is under 18, then two Massachusetts physicians must confirm the need
  • Customers must be 21 years or older for recreational use
  • Customers must have a government-issued current ID or passport
  • Medical sales for medical marijuana require a state-issued patient permit

Marijuana Sale Regulations

The state requires cannabis businesses to track all cannabis sales. There are also limits on the number of marijuana products a retail dispensary can sell to a customer in one day:

Customers cannot smoke or eat any cannabis products in the dispensary unless the business also has a Social Consumption license and permit. There are no limits on how often you visit the same dispensary in one day, so long as you do not purchase more than the prohibited amounts in one day.

Permits and Licensing

Before filing a license application, you should check with your local jurisdiction or municipality to make sure you can run a cannabis business in the location chosen.

Next, you submit your cannabis dispensary license application via the Massachusetts Cannabis Industry Portal (MassCIP). The Commission runs MassCIP. The following license types require annual renewal.

Within 90 days of submitting your license application, you will either receive a provisional license or a rejection. If approved, you pay a one-time application fee. If denied, you pay the fee again to reapply.

Registered Marijuana Dispensary (RMD):

  • Application fee: $1,500
  • Annual license fee: $10,000

Retail Stores and Dispensaries:

  • Application fee: $1,500
  • Marijuana retailer license: $10,000

Social Consumption Establishment:

  • Application fee: $1,500
  • Marijuana retailer license: $10,000

Cultivation Businesses: The application and license fees depend on the size of the facility and whether it is indoor or outdoor. The Commission provides a list of these fees.

Marijuana Product Manufacturer:

  • Application fee: $1,500
  • Annual license fee: $10,000
Medical Marijuana Treatment Center:
  • Application fee: $3,500
  • Annual license fee: $50,000
Delivery-Only:
  • Application fee: $1,500
  • Annual license fee: $10,000

Taxes

Register with MassTaxConnect to file tax returns and pay taxes on the sale of adult-use marijuana.

Local Market Competition

Dispensaries are opening quickly in Massachusetts. The state government can cap the number of new licenses at any time. Move quickly to create your business before the government pauses the application process. You may also consider home delivery of medicinal marijuana products to give your business an edge.

Dispensaries can be very profitable once they are up and running. Estimates show most dispensaries make upwards of $50,000 and can have profits in the millions over time.

You can see the number of local dispensaries by county on the Cannabis Control Commission map.

Cost to Open a Dispensary in Massachusetts

Cannabis startup costs will vary according to location. With a commercial lease agreement, employee costs, and licensing fees, expect to need hundreds of thousands of dollars at a minimum. Some cannabis businesses have startup costs in the millions.

Transporting Marijuana Across State Lines

Whether you can legally transport marijuana across state lines depends on the state. Massachusetts does not recommend traveling across state lines with Massachusetts-purchased cannabis. See FindLaw's article Transporting Marijuana: Laws and Regulations for more information.

Advertising Regulations
  • Cannabis marketing cannot “jeopardize public health." This means no marketing or sample programs near minors or child-related businesses.
  • The Cannabis Control Commission (CCC) allows the use of company brands and logos on marijuana products.
  • Packaging and signs cannot use medical symbols, images of marijuana, or marijuana-related items.
  • Cannabis businesses cannot use slang or everyday terms for marijuana, such as weed.
  • Displays for marijuana products must be clear.

Packaging and Label Regulations

Massachusetts has many nuanced packaging and labeling laws for cannabis products. CCC regulations include:

  • Required warnings about impairment, habit-forming risks, driving or operating machinery, and risks involving use while pregnant
  • The 21-year-old age limit must be on all marijuana products
  • Must have child-resistant packaging
  • Cannot have packaging that appeals to minors
  • Packaging must indicate the number of servings within it
  • Must list a statement that the product is not approved by the Food and Drug Administration (FDA)

Government Agencies and Cannabis Organizations

Note: While we strive to provide the most current information available, please consult an attorney or conduct your own legal research to verify the state law(s) you are researching.

What are the Steps Needed to Open a Dispensary?

Follow the steps below to prepare for the application process:

  • Understand the laws and regulations for your county or city
  • Create a business plan for your cannabis business
  • Seek finances and investors for your company – this is often heavily regulated
  • Determine company partners
  • Determine company structure
  • Apply for proper licenses and registration
  • Pay for license fees and background checks
  • Select the building or location
  • Hire your operations team and employees – everyone must pass a background check
  • Contract with cultivators or manufacturers for products, or apply for a license to grow them yourself
  • Open your doors to the public

This process is lengthy and requires nuanced documentation and steps along the way. An attorney can help you avoid common mistakes and get your dispensary doors opened as soon as possible.

Related Resources

Learn About Marijuana Dispensary Compliance

Find a Cannabis Attorney to Review Your Business Plan

If you are unsure which marijuana business is right for you or have compliance questions about the process, a business attorney may be the right solution for you. An attorney can advise you as you work to open your dispensary doors.In 2016, Massachusetts became the first state on the east coast to legalize recreational marijuana businesses. Until then, Massachusetts only allowed medical marijuana from nonprofit dispensaries known as Registered Marijuana Dispensaries (RMD). Now, the Massachusetts cannabis market is booming with recreational use marijuana business opportunities.

If you want to start a business in the cannabis industry, you have options. You can become a marijuana cultivator and grow marijuana products, or open a recreational cannabis retail store or microbusiness. You can also apply to be an RMD or even run a marijuana lab with testing capabilities.

Massachusetts' cannabis laws carefully regulate all types of marijuana establishments. The application process for a cannabis business is now open to entrepreneurs looking to create a compliant business plan.

Cannabis Business Laws You Need to Know

The Massachusetts Cannabis Control Commission (the “CCC" or “Commission") regulates the Massachusetts marijuana industry and all cannabis licenses in the state. The table below outlines the ordinances, regulations, and laws you must know before opening a cannabis dispensary in Massachusetts.

Marijuana Laws

Important Massachusetts cannabis laws include:

Customer Regulations
  • Customers must be 18 years or older for medical use. If the customer is under 18, then two Massachusetts physicians must confirm the need
  • Customers must be 21 years or older for recreational use
  • Customers must have a government-issued current ID or passport
  • Medical sales for medical marijuana require a state-issued patient permit

Marijuana Sale Regulations

The state requires cannabis businesses to track all cannabis sales. There are also limits on the number of marijuana products a retail dispensary can sell to a customer in one day:

Customers cannot smoke or eat any cannabis products in the dispensary unless the business also has a Social Consumption license and permit. There are no limits on how often you visit the same dispensary in one day, so long as you do not purchase more than the prohibited amounts in one day.

Permits and Licensing

Before filing a license application, you should check with your local jurisdiction or municipality to make sure you can run a cannabis business in the location chosen.

Next, you submit your cannabis dispensary license application via the Massachusetts Cannabis Industry Portal (MassCIP). The Commission runs MassCIP. The following license types require annual renewal.

Within 90 days of submitting your license application, you will either receive a provisional license or a rejection. If approved, you pay a one-time application fee. If denied, you pay the fee again to reapply.

Registered Marijuana Dispensary (RMD):

  • Application fee: $1,500
  • Annual license fee: $10,000

Retail Stores and Dispensaries:

  • Application fee: $1,500
  • Marijuana retailer license: $10,000

Social Consumption Establishment:

  • Application fee: $1,500
  • Marijuana retailer license: $10,000

Cultivation Businesses: The application and license fees depend on the size of the facility and whether it is indoor or outdoor. The Commission provides a list of these fees.

Marijuana Product Manufacturer:

  • Application fee: $1,500
  • Annual license fee: $10,000
Medical Marijuana Treatment Center:
  • Application fee: $3,500
  • Annual license fee: $50,000
Delivery-Only:
  • Application fee: $1,500
  • Annual license fee: $10,000

Taxes

Register with MassTaxConnect to file tax returns and pay taxes on the sale of adult-use marijuana.

Local Market Competition

Dispensaries are opening quickly in Massachusetts. The state government can cap the number of new licenses at any time. Move quickly to create your business before the government pauses the application process. You may also consider home delivery of medicinal marijuana products to give your business an edge.

Dispensaries can be very profitable once they are up and running. Estimates show most dispensaries make upwards of $50,000 and can have profits in the millions over time.

You can see the number of local dispensaries by county on the Cannabis Control Commission map.

Cost to Open a Dispensary in Massachusetts

Cannabis startup costs will vary according to location. With a commercial lease agreement, employee costs, and licensing fees, expect to need hundreds of thousands of dollars at a minimum. Some cannabis businesses have startup costs in the millions.

Transporting Marijuana Across State Lines

Whether you can legally transport marijuana across state lines depends on the state. Massachusetts does not recommend traveling across state lines with Massachusetts-purchased cannabis. See FindLaw's article Transporting Marijuana: Laws and Regulations for more information.

Advertising Regulations
  • Cannabis marketing cannot “jeopardize public health." This means no marketing or sample programs near minors or child-related businesses.
  • The Cannabis Control Commission (CCC) allows the use of company brands and logos on marijuana products.
  • Packaging and signs cannot use medical symbols, images of marijuana, or marijuana-related items.
  • Cannabis businesses cannot use slang or everyday terms for marijuana, such as weed.
  • Displays for marijuana products must be clear.

Packaging and Label Regulations

Massachusetts has many nuanced packaging and labeling laws for cannabis products. CCC regulations include:

  • Required warnings about impairment, habit-forming risks, driving or operating machinery, and risks involving use while pregnant
  • The 21-year-old age limit must be on all marijuana products
  • Must have child-resistant packaging
  • Cannot have packaging that appeals to minors
  • Packaging must indicate the number of servings within it
  • Must list a statement that the product is not approved by the Food and Drug Administration (FDA)

Government Agencies and Cannabis Organizations

Note: While we strive to provide the most current information available, please consult an attorney or conduct your own legal research to verify the state law(s) you are researching.

What are the Steps Needed to Open a Dispensary?

Follow the steps below to prepare for the application process:

  • Understand the laws and regulations for your county or city
  • Create a business plan for your cannabis business
  • Seek finances and investors for your company – this is often heavily regulated
  • Determine company partners
  • Determine company structure
  • Apply for proper licenses and registration
  • Pay for license fees and background checks
  • Select the building or location
  • Hire your operations team and employees – everyone must pass a background check
  • Contract with cultivators or manufacturers for products, or apply for a license to grow them yourself
  • Open your doors to the public

This process is lengthy and requires nuanced documentation and steps along the way. An attorney can help you avoid common mistakes and get your dispensary doors opened as soon as possible.

Related Resources

Learn About Marijuana Dispensary Compliance

Find a Cannabis Attorney to Review Your Business Plan

If you are unsure which marijuana business is right for you or have compliance questions about the process, a business attorney may be the right solution for you. An attorney can advise you as you work to open your dispensary doors.

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Restrictive federal laws and ever-changing state laws make the marijuana industry a dynamic environment for cannabis business owners. Before you open a cannabis business, make sure it is legal in your state, and follow your state laws. Once you decide on an LLC, S-corp, or C-corp business, you can register your business entity online using DIY business formation forms.

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