How to Open a Dispensary in Maryland 2025

To open a dispensary in Maryland, start by meeting state eligibility (age ≥21, MD residency, clean background, sufficient capital and – if applying in a social equity round – at least 65% ownership by qualified individuals). Decide on a license type (Standard or Micro dispensary), develop a thorough business plan, and secure a compliant location (e.g. 1,000+ feet from schools/parks) under local zoning rules. Then, use the Maryland Cannabis Administration’s (MCA) online OneStop portal to complete and submit your license application, including all required documents and fees (e.g. $5,000 application fee for a standard license or $1,000 for a micro license). Maryland’s first adult-use license round was reserved for social equity applicants, but subsequent rounds (expected mid-2024 and beyond) will be open to all qualified candidates. Once approved, ensure compliance with security, inventory (Metrc) tracking, and tax regulations while setting up your dispensary with tools like IndicaOnline’s cannabis POS system for inventory and compliance management. 

Maryland’s cannabis laws fully legalized adult-use cannabis on July 1, 2023, under the Cannabis Reform Act of 2023. The new Maryland Cannabis Administration (MCA) – successor to the old Medical Cannabis Commission (MMCC) – now oversees the cannabis industry. As a result, Maryland’s cannabis market is rapidly expanding. For perspective, one report projects over $1.1 billion in Maryland cannabis retail sales for FY2025. The state has capped new adult-use licenses at 300 dispensaries (in addition to existing medical licenses), making the licensing process competitive. In 2023–24, Maryland became the first state to grant initial cannabis licenses exclusively to “social equity applicants” – individuals from disproportionately impacted communities – highlighting the state’s emphasis on equity. Below, we break down the steps and requirements to open a dispensary in Maryland in 2025.

Maryland Dispensary License Types

Maryland issues several cannabis license types, and understanding them is crucial when planning your dispensary. The Standard Dispensary License allows a full retail storefront selling cannabis products (flower, edibles, concentrates, tinctures, topicals, etc.) directly to consumers. In contrast, the Micro Dispensary License is a delivery-only license: it authorizes a cannabis delivery service (no physical storefront) and is limited to 10 employees. Dispensaries are the point of sale for both medical patients and adult-use customers, so your license choice determines how you’ll operate. (Maryland also licenses growers, processors, testing labs, transporters, incubator spaces, and even on-site consumption lounges, but only dispensaries sell direct to consumers.)

For example, IndicaOnline notes: “Standard Dispensary License: Allows for the operation of a physical retail location where consumers can purchase cannabis products. Micro Dispensary License: Typically permits delivery services with up to 10 employees, often without a physical storefront”. In practical terms, a micro dispensary can deliver cannabis to consumer residences within its service area (as defined by MCA), while a standard dispensary operates like a typical retail shop. Early Maryland plans suggested a second license round (expected May 2024) could award up to 120 new dispensary licenses, split among standard and micro categories. Be aware that social equity applicants were prioritized in the first round.

Meeting Eligibility Requirements

Before applying, make sure you meet Maryland’s eligibility criteria. You must be at least 21 years old and a Maryland resident. A criminal background check is required, and certain felony convictions (especially recent or drug-related) can disqualify an applicant. You also must demonstrate sufficient financial resources and capital to operate the business. Importantly, social equity considerations are factored into Maryland’s licensing. If applying as a social equity applicant, at least 65% of your business must be owned and controlled by individuals who qualify under one of the criteria below:

• Residency in a Disproportionately Impacted Area: Lived in a ZIP code with historically high cannabis arrests/convictions for at least 5 of the last 10 years.
• Attended a Public School in a Disproportionately Impacted Area: Went to an eligible public school in such an area for at least 5 years.
• Higher Education with Pell Grants: Attended a 4-year Maryland college for ≥2 years where ≥40% of students received Pell Grants.

These criteria reflect Maryland’s Office of Social Equity (OSE) standards. In fact, the OSE notes Maryland was the first state to open its initial cannabis license round exclusively to qualifying social equity applicants. In the Fall 2023 round, the state received 1,708 social equity applications and awarded 174 licenses by lottery on March 14, 2024. If you meet one or more of the above criteria and assemble a qualifying ownership structure, you may receive special consideration in the licensing process. Whether or not you apply as social equity, your application must document these qualifications clearly.

Preparing Your Business Plan and Application

A detailed business plan is essential when applying. Maryland regulators expect applicants to submit a comprehensive plan outlining financial projections, operational structure, security measures, and marketing strategy. Your plan should demonstrate financial viability and compliance with cannabis laws. Include startup budgets, staffing plans, and how you will ensure diversity and inclusion in hiring (a focus of social equity requirements).

Next, develop a thorough site plan for your dispensary location. The plan must comply with local zoning ordinances and state distance rules (e.g. see below). Showing a secured lease or purchase agreement with diagrams can strengthen your application. Be prepared to address security, camera coverage, and traffic flow in your store plan. Maryland also requires applicants to have strict security protocols (cameras, alarms, etc.) and to track all inventory in the state’s Metrc seed-to-sale system. It is wise to describe these security and tracking methods in your application.

When you have your plan, gather required documentation. For Maryland, applicants will need to establish an account on the state’s OneStop portal and fill out the dispensary license application. You must select the license type (standard or micro) and provide detailed answers on business structure, financial sources, and compliance plans. Then upload supporting documents: a copy of your business plan, proof of Maryland residency for owners, sketches or plans for your facility’s security system, and a formal diversity/inclusion plan. Be thorough – omissions can delay processing.

• License Application: Submit via the Maryland OneStop portal. Ensure every field is completed accurately.
• Supporting Docs: Include your business plan, ownership documents, security plans, and community impact statements.
• Application Fee: Pay the required fee (currently $5,000 for a standard dispensary license, $1,000 for a micro license). Make the fee payment electronically through the portal before the deadline. 

Pro Tip: Consult the official MCA application instructions and consider professional legal advice. The Maryland Cannabis Administration provides guidelines on the application process and criteria. Completing the MCA license application carefully is the key step in opening a dispensary in Maryland.

Zoning, Location, and Facility Requirements

Securing a compliant location is critical. Maryland imposes strict location rules for dispensaries. The site must be at least 1,000 feet from schools, parks, playgrounds, and other areas frequented by minors. Additionally, dispensaries must be at least a half-mile apart from each other to prevent clustering. These distance requirements can vary by local jurisdiction, so it’s essential to check municipal zoning laws where you plan to open.

Beyond distances, ensure your location meets general commercial criteria (parking, accessibility, etc.). Engage with local planning or zoning boards early to confirm eligibility. You will ultimately need local permits (business license, health permits for edibles, fire safety approvals, signage permits, etc.) in addition to the state dispensary license. Include letters of intent or meeting summaries in your application to show the local authorities support your dispensary plan.

Security and Compliance Systems

Once licensed, dispensaries must install robust security and tracking systems. Maryland requires 24/7 video surveillance covering entrances, sales areas, and storage rooms, along with alarm systems and secure storage for all cannabis inventory. All cannabis products must be tracked in Metrc, the state’s seed-to-sale system. IndicaOnline (and similar cannabis POS systems) can integrate with Metrc to automatically report every sale and inventory change. For example, IndicaOnline’s POS offers real-time inventory tracking and automated compliance reporting, ensuring seamless data sync with state regulators. Investing in such software helps meet regulatory demands: it logs every gram of marijuana from purchase to sale and simplifies tax reporting.

Security plans should detail how products move within your store: e.g. limiting access to vault areas, inventory checks, and employee background procedures. IndicaOnline also notes that a modern POS can function offline during internet outages, which is important for continuous operation. Include all these measures in your license application and be ready for a state inspection before final approval.

Taxes, Fees, and Financial Considerations

Maryland imposes a 9% sales tax on adult-use cannabis sales, on top of any local taxes. Dispensaries must collect and remit this tax, maintaining precise sales records. A reliable POS system (like IndicaOnline) is invaluable here: it can automatically calculate taxes, generate tax reports, and keep detailed transaction logs. Ensure your business plan and capital projections account for inventory costs, operating expenses, and the time until sales begin (Maryland’s adult-use retail started July 2023 for converted medical stores, but new licensees may not open immediately).

Initial costs include the application fee ($5,000 standard or $1,000 micro) and the licensing fee if approved (up to $50,000 standard or $10,000 micro for a 5-year license, with 50% reductions for equity licensees). You should also budget for buildout of the retail space, security installations, staff training, and ongoing compliance. Highlight in your application how you will finance these costs. Some states (like Maryland) offer financial assistance or grants for social equity applicants – for instance, the OSE provides technical assistance grants up to $14,000 for qualifying licensees. Check if such programs apply to your business.

Opening Day and Ongoing Operations

If your application is approved, your business can begin operations under Maryland law. Only registered patients and adults 21+ may enter dispensaries; individuals under 21 are strictly prohibited. Dispensaries in Maryland also face advertising restrictions: you cannot market in ways appealing to minors or make unsubstantiated claims. Follow the MCA’s advertising guidelines (for example, no billboards near schools or youth organizations).

Inventory must be carefully managed. Maryland is unique in having an expanded product range – for example, certain high-THC products (above 10 mg edible or 100 mg total) must be reserved for registered medical patients. Dispensing limits (e.g. 1.5 ounces of flower per adult) must be enforced as well. Keep an updated Metrc log for every sale, and audit inventory regularly. IndicaOnline’s POS integrates sales with inventory updates and tax reporting, ensuring each cannabis product sale is compliant with state logs.

Logistics like deliveries should also be considered. Under initial rules, medical dispensaries could deliver to patients through June 30, 2024. Going forward, micro dispensaries will carry on the delivery model for adult-use customers. Plan your delivery logistics early if operating as a micro licensee (vehicle requirements, GPS tracking, body cameras for agents, etc. – see COMAR 14.17.12.03D).

Finally, as business grows, use reports from your POS to make data-driven decisions. For instance, IndicaOnline allows advanced reporting on best-selling cannabis products and customer metrics. This insight, along with maintaining top-notch compliance, will help your dispensary succeed in Maryland’s competitive cannabis market.

Social Equity and Community Impact

Maryland’s cannabis program emphasizes social equity at every stage. Beyond licensing, the state helps equity licensees through expungement programs and community reinvestment funds. For example, licenses may come with support grants and training opportunities from the Office of Social Equity. Even as you plan your dispensary, consider partnerships or hiring programs that benefit disproportionately impacted communities.

IndicaOnline itself offers a social equity program aimed at creating equitable ownership and employment in cannabis. While preparing your application, you might highlight any social impact initiatives or charitable commitments, aligning with the state’s goals.

Seizing Your Opportunity with IndicaOnline

Opening a dispensary in Maryland in 2025 is complex but feasible. The process – apply through MCA, meet social equity or general criteria, build a compliant business plan, and pay the fees – is detailed above. During launch and beyond, using specialized cannabis software can streamline operations. For example, IndicaOnline provides a cannabis-focused POS system that enhances inventory management and compliance. Its features include real-time tracking of every cannabis product, automated reporting to regulatory systems like Metrc, and integrated tax and marketing tools. By investing in a robust platform like IndicaOnline’s, you ensure your dispensary is audit-ready and customer-friendly.

Remember: how to open a dispensary in Maryland boils down to diligent preparation and compliance. The Maryland Cannabis Administration’s OneStop portal is your gateway to launching legally. Whether you’re a social equity entrepreneur or a seasoned business owner, follow the guidelines above, meet all requirements, and leverage tools like IndicaOnline for success. The Maryland cannabis market is growing fast; with the right plan, your dispensary can thrive in this newly-legal industry