opening a dispensary in new jersey

8 min read

How to Open a Dispensary in New Jersey

December 9, 2022

On his final day in office, January 18, 2010, then-Gov. Jon Corzine signed a rush of bills into law. One of them, the New Jersey Compassionate Use Medical Marijuana Act (CUMMA), was approved by the state’s legislature at that time. New Jersey became the fourteenth state to legalize medical marijuana. 

Currently, there are over 130,000 individuals who have joined the New Jersey Medical Cannabis Program. It is believed that the state will bring one billion in marijuana sales by 2024, becoming one of the largest cannabis markets throughout the whole country. 

After 11 years, the New Jersey Cannabis Regulatory Commission (CRC) released its initial set of rules for the adult-use recreational cannabis market on August 19, 2021. Important elements include: 

  • Giving social equity, diversely owned, and impact zone businesses top priority;
  • Establishing flexible criteria for those applying for conditional marijuana licenses and microbusinesses;
  • Requiring cannabis companies to manage smells, interact with the community, create strategies for environmental sustainability, and offer consumer education materials.

According to estimates, there are about 800,000 potential recreational consumers in New Jersey. It is assumed that roughly 12% of New Jersey residents over 21 may consume cannabis, considering the state’s population, those over 21, and consumption rates in neighboring states.

The New Jersey Cannabis Regulatory Commission was established on February 22, 2022, and began taking applications for adult-use retail cannabis stores on March 15, 2022.

The New Jersey Cannabis Regulatory Commission authorized the first 18 annual licenses to cannabis businesses on October 27. Ten applications were for conversions of conditional licenses to annual licenses, while eight were for direct applicants to annual licenses. Additionally, 297 more conditional licenses received approval, bringing the total number of conditional licenses approved since March to 801.

For those who want to know how to open a dispensary in New Jersey, here are some key details about the medical and recreational cannabis programs for you to consider. 

How to Get a Dispensary License in New Jersey

There are different procedures depending on whether you want to operate a medicinal or adult-use dispensary. Because New Jersey views medical dispensaries as Alternative Treatment Centers, a few more measures may be necessary (ATCs). New Jersey Department of Health (NJDOH) has published the Division of Medical Marijuana Request for Applications manual for those seeking to open a dispensary to get acquainted with the necessary licensing procedures to open an ATC.  

To find out more about how to open a dispensary in New Jersey for adult-use purposes, and how to get a dispensary license check out the rules and regulations that the Cannabis Regulatory Commission (CRC) of New Jersey has already issued. While both need some preliminary procedures, sufficient financing, and extensive preparation, opening an adult-use dispensary can be a little easier.

One must apply for a Class 5 Cannabis dispensary license issued by the CRC in order to start an adult-use recreational cannabis dispensary in New Jersey. Although applications are welcome, the competition is fierce due to the continuously changing laws, the number of micro-businesses fighting for these sought-after dispensary licenses, and the solid social equity policies.

Anyone preparing to open a dispensary in New Jersey should first go through the regulations provided by the CRC and the NJDOH. Learning the local laws in the area where you are located is very crucial. It should also be mentioned that all ordinances can “opt out” of recreational cannabis. 

Draft a Business Plan for Your Dispensary  

Our recommendation is that you draft a detailed business plan to increase your chances of getting a cannabis dispensary license. Make sure your document includes the information about the following:

  • The business’s actual location;
  • The ways the business will be funded;
  • The inventory fulfillment plan;
  • How you plan to staff the business;
  • Diversity and equity objectives;
  • Marketing strategies.

Application for a Cannabis License

In total there are six types of licenses available provided by the CRC, though most prospective dispensary owners will only need a cannabis retailer and a cannabis delivery license. Additionally, at least one of the owners has to be a resident of New Jersey for at least two years. 

The following are the additional criteria meet:

  • Available verified background check;
  • A business and business funding plan;
  • Submitted tax returns from the previous year;
  • Submitted personal history disclosures and entity disclosure forms;

In addition, if you are applying for social equity business license, you need to provide a submitted social equity business attestation.

The following step in the application process is paying the approval and license fees. It’s essential to remember that getting a medical cannabis business license is different from the usual licensing process, and the fees may also be higher. 

How Much Does it Cost to Open a Dispensary in New Jersey?

Opening a dispensary in New Jersey will cost you the following:

Adult-use dispensary

Type of Fee              

Standard Business  

 Micro Business 

Licensing fee   



Application fee    

$200 (condit.)

$400 (annual)

$100 (condit.)

$200 (annual)

Approval fee      

$200 (condit.)

$400 (annual)

$100 (condit.) 

$200 (annual)

Approval fee      

$800 (condit.)

$1,600 (annual)

$400 (condit.)

$800 (annual)


Alternative Treatment Center

Type of Fee Standard Business      
Application fee (non-refundable)   


Application fee (can be

canceled upon denial of license)


CRC is currently not accepting applications for Alternative Treatment Centers.

Opening a typical retail dispensary might cost between $250,000 to $2,000,000. However, a cannabis microbusiness model has much lower startup expenses and license fees.  

How Can I Obtain Funding?

It should be no surprise that opening a dispensary in New Jersey is an expensive undertaking that cannot be supported by the traditional financial sources offered by governmental organizations. As a result, you will need to look for alternative sources of money for starting the business. 

The majority of startups access the funds in several ways, including:

  • Self-Funding – Cannabis business owners in New Jersey are likely to choose this as their preferred option because of the mentioned difficulties in financing through traditional methods.
  • Friends and family – It is a good idea to obtain loans from relatives and friends who support your business strategy since they know the risks associated with a startup business. 
  • Partners – Many individuals are trying to enter the cannabis market. It may be beneficial for both parties to enter into a partnership, making this an excellent potential source of investment.
  • Personal Loans – If you have a solid credit history and a steady source of income, you could be eligible for a personal loan. 
  • Cannabis Business Loans – More and more lenders are prepared to collaborate with and support cannabis-related businesses. You can borrow money from a bank or credit union specializing in cannabis.
  • Crowdfunding – Crowdfunding platforms are becoming a more popular source of investment for startups. However, using this strategy can take months or even longer to acquire the money you want to launch your business.
  • Private Equity – Many private equity funds have been lured to the cannabis business. Private equity funds buy and invest in privately owned businesses to raise their worth, resell, or keep them for a very long period.
  • Angel Investors – An angel investor contributes capital to a company they believe will succeed in exchange for shares or potential future payback.
  • Venture Capital – A venture capital firm is one possible alternate source of cannabis industry investment. Accepting VC investment means selling equity in your cannabis business and lowering your ownership stake. 
  • Capital Brokers – Another fantastic choice to consider is attracting investors through the assistance of a capital broker specializing in the cannabis business. Locating and screening potential marijuana investors interested in funding the cannabis sector is their duty.

Keep in mind that the CRC will require you to provide evidence that you have the financial resources to support the start of the dispensary.

Social Equity Programs

One of the ways to receive priority consideration and approval throughout the application process for the cannabis company license is through social equity businesses. To qualify for a Social Equity Business status, the owner must have previous expertise, reside in an economically disadvantaged state region, or have previously been convicted of a felony involving cannabis. 

Aside from social equity businesses, other priority applicants are diversely owned businesses and impact zone businesses. The social equity attestation form is needed when submitting the license application. It’s the most important document you must complete, notarize, and submit to demonstrate that you are a social justice candidate. 

Choosing a Cannabis Dispensary Location

Location, location, location. 

Just like in the real estate industry, the location has great importance when choosing a space for your cannabis company, whether a medical or adult-use dispensary. This is true not only in terms of financial and customer benefits but also in terms of compliance and legal restrictions. 

According to state law, the medicinal cannabis and recreational cannabis programs are divided by region. These regions are made up of several counties. Why does this matter? For starters, the number of applications that may be submitted, as well as the number of license types, may be awarded within an individual region.

You will need to adhere to local zoning restrictions in your region, and you will need the city government to provide support before obtaining a license. This might be a letter of support from the mayor and/or municipal council or a copy of a city ordinance. You must be far away from churches, grocery shops, schools, childcare facilities, and stores that sell alcohol. 

That’s why the location is always thoroughly examined during the licensing process. 

How to Stay Compliant in New Jersey 

If you decide to open a dispensary in New Jersey or any other state, compliance with the law is essential, and the road ahead may be paved with challenges. That’s why, we, as an IndicaOnline team, are making every effort to simplify the process of business operations. 

We are an all-in-one compliant solution for medical and recreational dispensaries – POS software, delivery, and e-commerce platform. Our automated compliance lets you keep everything under control and detect any violations in advance to avoid problems with the law. Simple and secure POS is designed to boost your sales; through our intuitive interface, fast operations, spot-on features, and real-time updates, your customers will enjoy a comfortable retail experience.

This is just a short list of how IndicaOnline can streamline your business operations and bring your dispensary to a new level!  Schedule a call with our representative now to learn more!


Due to the specificity of the industry, it is essential to educate yourself on the state laws and regulations to start a fully compliant dispensary business in New Jersey. Hopefully, our article helped you by providing the right information and the materials to read up on.