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How to Get a Dispensary License in Colorado 2024

June 7, 2024

The marijuana industry in Colorado is well-established, offering numerous opportunities for entrepreneurs. If you’re looking to enter this booming market, understanding how to get a dispensary license in Colorado 2024 is crucial. The licensing process involves addressing various state and local regulations, ensuring compliance with legal requirements. This guide will walk you through the essential steps and considerations to help you successfully apply for and obtain a dispensary license in Colorado.

Understanding Colorado’s Licensing Authority

In Colorado, the Marijuana Enforcement Division (MED) is responsible for regulating marijuana businesses and ensuring all cannabis operations comply with state laws and guidelines, thus promoting public safety and industry integrity. Understanding and adhering to MED regulations is essential for anyone seeking to operate a legal dispensary in Colorado​.

Types of Dispensary Licenses

Colorado offers different types of licenses for those interested in opening a dispensary, including licenses for retail marijuana stores and medical marijuana businesses. Retail marijuana stores cater to adult-use consumers, while medical marijuana businesses serve patients with qualifying conditions. Each license type has specific criteria, making it essential to choose the appropriate license that aligns with your business goal. Learn more about the licenses

Types of Marijuana Dispensary Licenses in Colorado

There are several types of medical and recreational dispensary licenses available in Colorado.

Medical Marijuana Licenses:

  1. Medical Marijuana Store License:Allows the operation of a business that sells medical marijuana to Colorado Medical Marijuana Registry Patients and Transporting Caregivers.
  2. Medical Marijuana Business Operator License:Provides professional operational services to one or more MED-licensed medical marijuana businesses.

Recreational (Retail) Marijuana Licenses:

  1. Retail Marijuana Store License:Allows the operation of a business that sells retail marijuana to individuals aged 21 and older.
  2. Retail Marijuana Operator License:Provides professional operational services to one or more retail marijuana businesses.
  3. Retail Marijuana Hospitality and Sales Business License:Permits the operation of licensed premises where marijuana may be sold and consumed.

Prequalification Application

The prequalification application is the first step in the licensing process in Colorado. This initial phase involves a thorough review of the applicant’s background and financial standing, and requires such documents as personal identification, financial statements, and proof of assets. Background checks are also conducted to ensure compliance with state standards. The MED requires a non-refundable application fee. This prequalification is essential before proceeding to the full application stage​.

Application Process

Step-by-Step Application Guide

  1. Prequalification: Complete the prequalification application to verify eligibility by submitting personal identification, financial statements, proof of assets, and undergoing background checks. The main applicant pays a non-refundable $3,000 application fee, while supplemental applicants must also submit prequalification applications but are not required to pay an application fee.
  2. Submission of Detailed Plans: Applicants must submit a comprehensive operational plan that includes security measures, inventory control system, staffing plans, and customer service protocols.
  3. Local Jurisdiction Approval: Securing approval from the local jurisdiction in the dispensary’s proposed location is crucial. This includes meeting local zoning laws and obtaining the necessary permits.
  4. State and Local Fees: Applicants must pay both state and local jurisdiction fees. The MED provides an online payment option, and all fees must be paid in full to avoid delays in processing​
  5. Supporting Documentation: Include all required documents such as property deeds, lease agreements, proof of financial responsibility, and detailed business plans. These documents demonstrate compliance with state and local regulations and ensure the business is prepared for operation.
    Learn more about how to apply.

Background Checks and Financial Requirements

Background checks are a critical component of the licensing process in Colorado. These searches review the applicant’s criminal history (if any), financial stability, and business experience to ensure they meet state standards for operating a dispensary. Applicants must also demonstrate that they possess sufficient capital to sustain the business and pay a non-refundable license fee. Meeting these financial and background check requirements is essential for ensuring the legitimacy and reliability of Colorado’s marijuana industry​.

Social Equity Program

Colorado’s social equity program aims to support communities disproportionately affected by marijuana prohibition by offering reduced fees, technical assistance, and other benefits to eligible applicants. To qualify, individuals must meet specific criteria, such as residency in certain areas or having past marijuana-related convictions. The program promotes inclusivity and diversity in the marijuana business sector, ensuring fair opportunities for those impacted by past policies​​.

Local Jurisdiction Approval

Securing local jurisdiction approval is a critical step in the licensing process. Municipalities in Colorado have the authority to regulate marijuana establishments within their jurisdictions and may impose additional requirements. Applicants must obtain local permits and ensure their dispensary location complies with local zoning laws. This step is crucial for ensuring compliance with both state and local regulations​​.

Operational Plans and Inspections

A comprehensive operational plan is essential for a successful dispensary license application and it should cover security measures, inventory control, staffing, and customer service protocols. The MED and the Bureau of Fire Services will conduct inspections to ensure the facility meets all safety and regulatory requirements, so preparing a detailed operational plan and ensuring the dispensary is ready for inspection are crucial for obtaining a license​.

Marijuana Hospitality and Sales Business

Marijuana hospitality and sales businesses are unique establishments in Colorado that allow on-site consumption and sales of cannabis products. Licensing for these businesses involves additional requirements, including specific operational and safety standards. Understanding the licensing process and operational requirements for marijuana hospitality and sales businesses is essential for those interested in entering this niche market​.

State Sales Tax and Financial Compliance

Dispensaries and other marijuana businesses in Colorado must comply with state sales tax obligations, which involves registering for a state sales tax license and ensuring accurate financial reporting. Understanding and meeting state tax requirements is essential for maintaining compliance and avoiding penalties​​.

Additional Steps and Compliance

Applicants must also meet specific labor and employment requirements, including compliance with state and federal labor laws. It is essential to stay updated on any changes to MED rules and regulations, as noncompliance can result in fines or loss of license. Regularly reviewing and updating compliance measures will help ensure the dispensary remains in good standing with state authorities​.


Understanding how to get a dispensary license in Colorado 2024 involves tackling a detailed and highly regulated process. By following the steps outlined and ensuring compliance with all requirements, prospective dispensary owners can successfully secure their licenses and operate within Colorado’s thriving cannabis industry. Key steps include securing prequalification, obtaining local jurisdiction approval, developing comprehensive operational plans, and ensuring readiness for state inspections. With careful preparation and adherence to state and local regulations, entrepreneurs can establish successful and compliant dispensary businesses, contributing to the dynamic and expanding marijuana market in Colorado​.

By staying informed and prepared, you can take advantage of the opportunities within Colorado’s established and supportive framework for marijuana businesses. Whether you’re aiming to open a retail marijuana store or a marijuana hospitality and sales business, understanding the licensing requirements and following them diligently will be crucial to your success.