The Legal Dose: Typical Cannabis Startup Costs and Annual Operating Expenses By Sector
While the numbers can vary widely within business sectors and across states, it is clear that plant-touching businesses regularly experience much higher startup and operating costs than their ancillary and supportive business sector counterparts. Much of this disparity can be explained by the increased costs associated with licensing (both initial and continuing) and ongoing regulatory compliance for plant-touching businesses throughout the country.
While median startup costs for wholesale cultivators continue to exceed the median startup costs for all other cannabis business sectors, those wholesale cultivators engaged in (or expanding into) full-fledged vertically integrated grower/retailer operations are hit particularly hard as they are forced to absorb the additional increased costs associated with operating ongoing retail locations as well. In some cases, the median operating expenses for vertically integrated medical and recreational retailers can exceed the operating expenses of a standalone medical/recreational retail location three fold.
For any questions on this topic or Cannabis Law, please contact Andrew Robinson at or 301.575.0321
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Andrew Robinson is a Principal in the Real Estate Law And Transactions group. He focuses on land use cases as well as areas of administrative and construction law. Mr. Robinson has experience representing clients facing homeowner association, landlord-tenant or construction disputes. He has assisted clients in processing subdivision and condominium development as well as in planning and zoning matters. Additionally, clients turn to Mr. Robinson for complex real estate transactions, commercial leasing, and general litigation.
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