Colorado Cannabis Market

Cannabis in Colorado has been legal for medical use since 2000 and for recreational use since late 2012. Colorado became the first state to approve 280E deductions in 2014, that allows cannabis companies to deduct business expenses from their state income taxes.

How to Start a Cannabis Business in Colorado?

Cannabis consumers spent $1,529 million in 2023, including $185 million medical and $1,344 million recreational cannabis sales, according to data from the Department of Revenue’s Marijuana Enforcement Division. Cannabis sales averaged $1.95 million ($2.30 million in 2022) per retail location in Colorado’s adult-use market and $0.53 million ($0.59 million in 2022) per location in the medical channel.

How to Open a Dispensary in Colorado?

The Marijuana Enforcement Division (MED) is tasked with licensing and regulating the Medical and Retail Marijuana industries in Colorado.

Step 1: Study the Colorado’s Regulated Marijuana Business License Application process.

Step 2: Check if you meet the criteria to start your own retail cannabis business in Colorado. All applicants must demonstrate at least two years of Colorado residency when applying for a license, and pass criminal and credit background checks:

  • Be age 21 or older.
  • Be residents of Colorado.
  • Pass criminal background checks.

Step 3: Prepare your business plan with financial pro forma to estimate your costs and profits before starting the application process.

When choosing a location for your cannabis retail store, you will have to comply with local county and city zoning restrictions and requirements. Colorado allows local jurisdictions to impose restrictions on the time, place, manner and number of marijuana businesses.

Step 4: Download a copy of the Regulated Marijuana Business License Application or submit it digitally. Finding of Suitability Application must also be submitted by each owner applicant who has 10% interest, or greater or controls the Regulated Marijuana Business. Keep in mind that the applications may require additional documentation, such as evidence of the premise to be licensed, copies of tax/wholesale license, funding source disclosure, etc.

Step 5: Pay application fees. Fees for a new retail marijuana establishments are the following:

  • Initial application fee $5,000;
  • Initial license fees: $2,850 (Level 1), $5,550 (Level 2), $8,200 (Level 3);
  • Renewal application and license fee $2,300.

Pay local jurisdiction fees.

Step 6: Once you have your documentation, you can submit your application by mail, digitally or in-person.


Cannabis Retail + Lounge Pitch Deck Sample, Colorado

Open Cannabis Dispensary Colorado


'70% ready to go' business plan templates

Our cannabis retail financial models and cannabis retail business plan templates will help you estimate how much it costs to open your own cannabis store, to build all revenue and cost line-items monthly over a flexible seven year period, and then sums the monthly results into quarters and years for an easy view into the various time periods. We also offer investor pitch deck templates.

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