The New Mexico Legislature recently voted to legalize recreational cannabis through the House Bill 2 that was recently passed by two House committees.
The bill, sponsored by Reps. Javier Martinez, Andrea Romero, and Deborah A. Armstrong passed the House Health and Human Services Committee on Feb. 15 and passed the House of Taxation and Revenue Committee on Feb 24. Now, on March 31, it passed the Senate on a 22-15 vote.
It then returned to the House, which had approved it 38–32 earlier in the day, for consideration of Senate changes. That vote passed by a voice vote.
Legal retail sales are scheduled to begin by April 1, 2022
Opening a Cannabis Dispensary in New Mexico
Although there have been some delays in signing the bill, and the road to recreational sales in early 2021 is anything but clear, recreational sales are expected to take up to six months to reach the market.
With the revenue generated by cannabis dispensaries in the billions of dollars and rising, these developments present a very lucrative opportunity. However, opening and running a dispensary is a challenging business venture:
- Opening a dispensary requires a lot of considerations, compliance with numerous regulations and a significant amount of capital.
- Costs to open your doors could run from $500,000 upwards of millions depending on real estate costsand the size of the operation.
- Many cannabis dispensaries are selling millions of dollars of product a month
- Competition for new dispensaries tends to be fierce.
It’s important to mention that the first dispensaries that will sell recreational cannabis will be existing medical marijuana dispensaries, and although the application window isn’t open just yet, it is generally a good idea to be prepared ahead of time for the application process.
Timeframe for the licensing process
The Cannabis Control Division is going to start accepting and processing New Mexico Cannabis license applications in accordance with the following schedule:
- September 1, 2021: Cannabis producers; cannabis producers microbusinesses and any other person properly licensed and in good standing as a licensed cannabis producer pursuant to the Lynn and Erin Compassionate Use Act.
- January, 2022: All other licenses.
The Cannabis Control Division (CCC) is scheduled to develop a plan to encourage racial, ethnic, gender and geographic diversity among licensees by no later than January 1, 2022.
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Obtain a New Mexico Cannabis License
You can check out the details on how to obtain a New Mexico cannabis license here. Obtaining a cannabis license can be incredibly difficult and costly. Further, there usually are strict requirements for prospective dispensary owners.
Apart from direct cannabis knowledge, your team must be knowledgeable in a wide range of topics. This is because there are multiple topics considered essential to running a cannabis company, and any information gaps will jeopardize long-term success.
Also, your team should prepare various business plans, which should include:
- Financial Plan
- Manufacturing Plan
- Inventory Control Plan
- Security Plan
- Recordkeeping Plan
- Community Benefits Plan
A revenue forecast is conducted by estimating how much product you think you will sell production costs, retail price and complementary costs (payroll, rent, transport, etc.). You may also include a break-even analysis, with an estimated timeline until profitability.
- New Mexico-specific Requirements – You may include details of covering your security systems, secure product transport, product tracking, waste plans and other state requirements. Note that these may be included in your application.
- Investor Proposal – Involves how you will value your shares if you present your plan to investors. Consult with a CPA to ensure you are compliant with state and federal regulations
With the right motivation and access to necessary resources, our office can help you successfully start a profitable cannabis dispensary in New Mexico. Although it is important to note that this process takes time even when you have the resources.
Given the licensure steps, finding a suitable location and developing your storefront to meet the state requirements, it may take well over a year from application to selling.
Remember: the cannabis industry is heavily regulated and getting help from industry, and business experts is recommendable.
And lastly, don’t miss out on our Marijuana Legalization Map where you can browse the current status of laws in every state in the United States and see all our posts on each of them.
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