In May 2022, Rhode Island became the nation’s 19th state to legalize recreational marijuana, allowing the state’s already-established dispensaries to start selling cannabis for recreational use.
In Rhode Island, medical dispensaries are referred to as Compassion centers. Patients who meet the requirements can purchase medical marijuana at compassion centers under Rhode Island legislation. They are under the control of the Department of Business Regulations (DBR) and the Medical Marijuana Program.
The first retail license under the new law will be made available to existing medical dispensaries.
The sale of cannabis for recreational use will not be permitted by state law for medical marijuana stores to begin until December 2022.
In this blog post, we’ll go through cannabis legislation in Rhode Island, license types and how to get them, tax rates, and more.
Can I Open A Dispensary In Rhode Island Right Now?
Only if you are an existing medical dispensary owner you can be considered to get the retail license under the new law. Medical dispensaries will be able to sell cannabis for everyday use by December 2022.
Cannabis retail licenses in Rhode Island will be allocated on the basis of the state’s six geographical zones. Four new cannabis stores will open in each geographic region.
Your competitors in the space will include:
- Greenleaf Compassionate Care Center
- Thomas C. Slater Compassion Center
- Summit Medical Compassion Center
- Sweetspot Dispensary
- The Joint on 6
- The Baked Bakery
- Mammoth Inc
- Rhode Island Reef and more
How Much Can You Buy?
The Rhode Island Cannabis Act permits adults over the age of 21 to possess up to one ounce of cannabis in public or up to 10 ounces at home, grow up to six plants at home (no more than three of which may be mature), and buy a limited amount. Additionally, it makes it easier for old criminal records to be reviewed automatically and expunged.
How Much Cannabis Can An Adult In Rhode Island Possess?
The Rhode Island Cannabis Act enables an individual who is 21 years of age to possess up to 1 ounce in public or up to 10 ounces at home, and home-cultivate up to 6 plants, no more than three mature.
Current Cannabis Laws In Rhode Island
- Cannabis in Rhode Island is legal for non-medical use.
- Qualifying patients or their caregivers can purchase up to 1 oz in public; up to 10 oz at home.
- Medical cannabis can be acquired only by qualifying patients suffering from debilitating conditions such as cancer, glaucoma, HIV/AIDS, and others.
- Plants must be grown indoors under controlled conditions away from public view.
- The qualified patient must be above 21 years of age.
- Medical cannabis dispensaries will possess hybrid licenses to sell both medical as well recreational cannabis to start with.
- Recreational cannabis cannot be sold before December 2022.
Tax Rates in Rhode Island
7% sales tax on cannabis sales, plus a new 10% cannabis tax and a 3% local tax to the town or city where the store is located.
Expected Cannabis Market in Rhode Island
According to a report by Statistica, the Rhode Island cannabis market can generate about $167.6 million in sales by 2025.
Types of Cannabis Licenses in Rhode Island
There are 5 different categories of marijuana business licenses available in Rhode Island. The 5 cannabis licensing categories in Rhode Island include:
- Product Manufacturer (aka Processor)
- Hybrid Retailers
- Testing Laboratory
- Compassion Centers – Compassion centers are places for patients who have qualifying conditions to obtain medical marijuana as allowed by Rhode Island law. The Medical Marijuana Program within the Department of Business Regulations (DBR) manages them.
How To Get A License
Adult-use cannabis retail licenses will be the subject of Rhode Island’s first round of license applications. The State intends to grant new applicants 24 retail cannabis licenses. The administration is thinking about first issuing licenses to already-existing medical dispensaries.
Here’s what we know about how to open a dispensary in Rhode Island so far:
- The applicant does not need to prove residency in Rhode Island.
- All the owners listed in the cannabis dispensary application are above the age of 21;
- No owners has disqualifying convictions; and
- Your applying entity is in compliance with all tax obligations.
- Organize all corporate documents, including articles of organization, agreements, and good standing certificates, among others.
- Possess a solid business plan.
Rhode Island will reserve a percentage of the licenses for specific kinds of applicants. More particularly, Rhode Island will issue:
- 25% of licenses to social equity applicants; and
- 25% of licenses to workers’ cooperative applicants.
Therefore, you should consider applying as social equity or workers’ cooperative applicant to increase your chances of getting a license.
Rhode Island Dispensary Fees
|Type of Fee||Amount|
|Non-refundable Application Fee||$10,000|
|Annual License Renewal Fee||$500,000|
What Else Do You Need to Open a Dispensary in Rhode Island?
Understand Cannabis Laws In Rhode Island
The rules governing cannabis vary from state to state and are not governed by federal law. Some states permit the use of marijuana for both recreational and medical purposes, while others exclusively permit medical usage and still others only permit the use of specific low THC products. So, in order to open a dispensary in Rhode Island, you must be aware of the rules and legislation and follow them.
Create A Solid and Scalable Business Plan
Any business that wants to succeed must be launched and run with a comprehensive grasp of its target market, internal competitive advantages, external environment, and future competitive landscape. For a business to start, run, and expand, it also needs money. You will have a strong strategy for enticing investors if you take the time to create a thorough business plan. Your company’s roadmap is your business plan. It describes your position, methods of approach, and course of action in detail. It will also enable you to stay ahead of your competitors in the cannabis marketplace:
Highlight Your Business Operations
You’ll concentrate on the operational side of things in this section, including the location of your company, the tools you employ, and the dependability of your systems.
Start by focusing on the location where you operate and consider whether it meets both your present and future demands. Next, take into account how current and effective your equipment is and how it stacks up against industry standards.
Additionally, you must describe how your IT systems are configured as well as how you plan to manage your finances, inventory, and client information. Reliability and how simple it will be to expand in these areas should both be taken into account.
Management & Organization
Describe your company’s organizational structure in the Management & Organization section of your business plan.
Create a short resume for each of the important employees in your company. Include how your prior education and work experience can help you manage each part of your business if you’re a solopreneur. Include their appropriate education and experience as well if you have any partners or employees.
You can share the research you’ve done to understand your target audience—the prospective customers of your products—in the market analysis part of your business plan. When someone asks for a business plan, they want to know that you have a thorough knowledge of your industry, the competitive landscape, and your most likely clients. It’s critical to show that your product has a sizable enough market to be profitable and/or generate a significant return on investment.
Financial Requirements And Projections
Writing a business plan includes a crucial section on financial planning. Keeping track of how much money you are earning and spending is one of the characteristics of a successful business.
Share your anticipated revenue and expense levels for the first or following five years of your business in Financial Projections. To show that the revenue you anticipate can readily result in a return on any investment, whether from your personal funds or a capital lending service, is the goal here.
Now think about your competitors, their product strategies, and the reasons consumers choose them. Identify their advantages and disadvantages, place in the market, and status (growing, maintaining, scaling back). When an entrepreneur asserts there is no competition for his good or service, investors become alarmed. You should be aware of the two types of competition that exist: direct and indirect. Indirect rivalry provides comparable products/services to a different market while direct competition provides the same product/service to the same market. There must be a discussion of both in your presentation.
So there it is—a thorough explanation of how to develop a business plan. It’s an important and useful document whether you’re just starting a business or trying to grow an existing one. A strong business plan is meticulously written using your expertise and comprehension of your company and the industry it competes in. Whether you use it internally or outwardly, it can aid in keeping you focused on your goals.
Staffing Your Dispensary in Rhode Island
The objective is to build a team that is committed to the success of the organization and is aware of it. Such a team is challenging to create and manage; it requires preparation and commitment. To start, you must carry out a thorough hiring procedure to make sure you have the right people on your team. Then, you must be able to maintain that people’s engagement, attention, commitment, and drive through recognition and continued advancement.
Choose Your Location With Care
Location is crucial when choosing an office or retail space. The value of a commercial property is determined in part by its location along important highways or thoroughfares, its proximity to other properties, its desired addresses, and its amenities.
The importance of a cannabis dispensary cannot be overstated. Location-based assessments including foot traffic, proximity to similar establishments, parking ratios, local population demographics, and ease of access are among the measurable factors for predictable sales. These are all connected to the location that a store decides to rent a building in.
However, bear in mind that each state has its own regulations before deciding on a location for your cannabis dispensary.
Tech Integration with Leading Technology Partner
In order to run their everyday business, dispensaries need to use a variety of hardware, software, and point-of-sale (POS) systems. These devices capture a lot of information, such as data on the customers, payroll information, sales history, and many other things. You can optimize the data shared between systems if these devices are integrated and able to “communicate” with one another.
Additionally, businesses with well-integrated technologies can delve deeper into the data. This enables business leaders to thoroughly analyze the data and get insightful knowledge to enhance their existing practices, make the most of their people and technologies, and outperform their competitors.
If you need help with tech integration you can contact Cure8. We have everything you need to finish the tech installation in your store, including scanners, tablets, PCs, POS systems, surveillance systems, and much more. From the ground up, we can develop and design your store.
How Can Cure8 Help?
Cure8 is a one-stop tech solution provider for cannabis businesses. Our solutions can transform your business for the better. We collaborate with you to determine which IT services and solutions are best for your cannabis business. Cure8’s solutions and services include tech consultation, managed IT services, and custom hardware and software solutions. Check out more about our solutions here.