The biggest issue for any entrepreneur trying to launch a business is securing enough seed money to be successful, with enough left over to act as a cushion for difficulties and unforeseen circumstances that inevitably arise.
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With many cannabusinesses, these include things like consultants, security and build-out costs. If you are going for or have recently been awarded a permit somewhere in one of the established Western markets, be prepared to fork out $40,000 for a dispensary and a little over $115,000 for a grow operation in build-out costs. Remember there are strict regulations and everything has to be done by the book. Build-out costs include plumbing, electrical work, adding or removing doors and partitions and even putting in a wheelchair ramp to be in compliance with the Americans with Disabilities Act. Décor such as paint, carpeting and display cases or as a grower lighting, cool and hydroponic systems are not included. Whatever your budget is experts say double it at the very least.
Industry newspaper Marijuana Business Daily recently examined build-out costs using BuildZoom.com’s database, analyzing the data of 13 grow facilities and 36 medical marijuana dispensaries established in five Western states. These were: Arizona, Colorado, California, Oregon and Washington State. Across these states the costs were similar. In California, dispensaries often renovated their space to bring it into compliance or took over a previously held business.
In Colorado, growers were more likely to start from scratch, while dispensary owners often acquired previously owned cannabusinesses, which they renovated to make their own. For the rest, permits were more likely for new operations. Since building permits are of public record, anyone can go and see the estimated building costs, what contractor they used and more. This provides a treasure trove of information for anyone starting a grow operation or dispensary in a city or community that already has similar businesses. Many cut corners by doing all the work themselves rather than enlisting the services of a contractor. In this case material costs must be budgeted, as well as time. Just remember, whatever time you spend building is time away from the business itself.
