Given the legalization of recreational and medical marijuana in Oregon, it’s an exciting time for entrepreneurs and business owners in the state. Opportunities in the cannabis industry are unlimited, but weeding through tons of information — and misinformation — can be confusing.
To help kick-start your marijuana business in Oregon, we’ve compiled this handy guide that covers everything you need to know about starting a marijuana business in the Beaver State. Let’s dive in.
Is Marijuana Legal in Oregon?
Medical and recreational marijuana are legal in Oregon for both sale and possession.
The state has over 22,000 patients registered for the medical marijuana program. Patients with a doctor’s recommendation can apply for a medical marijuana card. With a card, they can possess up to 24 ounces of cannabis at a time.
For recreational use, adults can possess up to 1 ounce of cannabis in public, and up to four plants may be grown in a single household. Also, there are no upper caps on the number of cannabis business licenses issued yearly, making it an incredible opportunity for entrepreneurs.
Starting a Marijuana Business in Oregon
There are several steps you have to take to get your marijuana business off the ground in Oregon. Let’s take a look.
Step 1: Determine The Type of Business and Choose a Name
Your first step to starting a cannabis business is to determine the type of entity you wish to form. Oregon issues three types of licenses for different categories of medical marijuana businesses:
- Cultivators engage in cannabis growing
- Dispensaries are retail storefronts that sell marijuana and edibles to customers
- Processors buy cannabis from licensed cultivators, process them into edibles, and sell them to dispensaries
Besides these three licenses, Oregon issues two other license types for recreational cannabis businesses:
- Wholesalers buy cannabis in bulk from cultivators and sell it to other licensed business holders
- Testing labs are accredited by the Oregon Environmental Laboratory Accreditation Program and test cannabis for the presence of solvents, pesticides, and other contaminants
Once you decide on your entity type, the next step is to choose a unique name for your business.
Step 2: Obtain Required Licenses
Before officially starting your cannabis business, you must obtain the required Oregon weed licenses. The application fee is approximately $500 for a marijuana dispensary or processor. There are no application fees to become a medical cannabis cultivator. The application fee for a recreational business license is $250, irrespective of the type of license.
Besides the application fee, you’ll also have to pay licensing fees ranging from $2,000 to $4,750, depending on the type of business entity. All recreational marijuana business licenses need to use Oregon’s Cannabis Tracking System, which includes training for new business owners, ID numbers, plant tags, and more.
Step 3: Develop a Business Plan
Recreational cannabis businesses in Oregon must submit a Marijuana Business Operating Plan form when filing an application. Here are a few major components to include in your business plan:
- Product/service description. Specify the business type and unique selling proposition.
- Market research. Research and identify your target audience and demographics to determine the viability of your business.
- Competitors. Who are your direct and indirect competitors? Identify the key features that make your business stand out from the competition.
- Management team. Add a brief description of the qualifications of the key members of your team.
- Financials. You need to provide the projected annual revenues, net profits, operating costs, expenses, and a five-year financial forecast. You might also want to include a break-even analysis showing when you hope to be profitable and a sensitivity analysis describing the best- and worst-case scenarios.
Step 4: Secure Funding and Kickstart Your Marijuana Business in Oregon
Like any other type of enterprise, you need working capital and timely funding to commence, accelerate, and grow your business. Although marijuana is legal in Oregon, it remains a Schedule I drug at the federal level. Therefore, banks and other financial institutions are hesitant to fund cannabis business owners.
As the leading cannabis lender in Oregon, Bespoke Financial is committed to supporting this flourishing industry by providing marijuana businesses with the best financing solutions to begin and grow their operations. Take the next step toward your entrepreneurship dreams and apply for a cannabis loan today.