Operating A Dispensary In Ohio: A Comprehensive Guide

This year, cannabis sales in Ohio passed $2.5 billion. Cashing in on this growing market isn't easy, but we've compiled expert advice on opening and operating a dispensary in the Buckeye State to help you realize your green dreams.

Key Takeaways

• There are four types of dispensary licenses, though you can get multiple types.
• Applications to open a dispensary require a lot of information, including personal information, as well as a $5,000 fee.
• You'll also have to pay fees for your operating license, for employees, for advertising, and more.
• Existing medical dispensaries can also apply to become recreational marijuana dispensaries.
• Regulations you need to consider include the location of your dispensary, how you package and advertise your products, tracking everything, and more.
• Your cannabis dispensary floor plan needs to include separate areas for retail, secure storage, and sales. 
• Ohio allows dispensaries to conduct sales via drive-thru and curbside pickup, but you have to apply to be allowed to do this.

See Related: Is THCa Legal in Ohio? Navigating Cannabis Laws In 2024

Cannabis Laws in Ohio

The legal landscape in Ohio surrounding cannabis has changed rapidly over the last decade. Ten years ago, the state prohibited cannabis. Now, dispensaries in Ohio are permitted to sell medical marijuana, recreational marijuana, and hemp-derived products.

It can be hard to keep up with such rapid and profound change, especially when laws and regulations continue to be debated and adjusted.

Nevertheless, it's vital to understand exactly what is and isn't permitted. That's true for anyone, but especially true for anyone operating a dispensary in Ohio.

After all, there are plenty of rules and regulations you have to follow — and pretty hefty penalties for not doing so. 

We'll get to those later. First, let's explore exactly what dispensary owners need to know when it comes to Ohio's cannabis laws.

For Medical Marijuana

Ohio legalized medical marijuana in 2016. First, let's discuss some key terms you'll want to know:

• House Bill 523: This is the legislation that legalized medical marijuana in Ohio. You can find the full text here.
• Ohio Medical Marijuana Control Program: Also known as OMMCP, this is the program through which people can get medical marijuana.
• State Medical Board of Ohio: Only physicians certified by this board can provide the recommendation necessary for acquiring medical marijuana.
• Division of Cannabis Control: Also known as DCC. This is part of Ohio's Department of Commerce. It licenses and regulates cannabis cultivators, labs, processors, and dispensaries. 
• Medical Marijuana Patient & Caregiver Registry: Can be accessed by patients and caregivers, and provides information on medical marijuana. That includes how to find a qualified physician, where to get medical marijuana, and help understanding the various rules governing the program.

Medical marijuana in Ohio is restricted to people with certain medical conditions. A full list of qualifying conditions can be found here. The State Medical Board can add to the list.

Remember, patients can't just claim to have one of these conditions. In order to gain access to medical cannabis, an individual must get a recommendation from a certified physician. 

As a dispensary owner, you're responsible for ensuring compliance with this crucial part of medical marijuana law. 

Medical cannabis, like any medication, is prescribed in certain amounts. This might vary depending on an individual's condition and how much cannabis they need.

In general, Ohio prohibits registered individuals from possessing more than a 90-day supply of medical cannabis. 

What exactly constitutes a 90-day supply varies, depending on how much an individual needs. For example, roughly 53g of THC is a 90-day supply when it comes to THC oil specifically for vaping. But the limit is less than 10g of THC when in tinctures, capsules, or edibles.

Dispensary owners should be careful not to accidentally sell more than they are permitted.

Bonus: 10 Natural Pain Relievers

For Recreational Marijuana

Voters in Ohio approved a ballot measure for recreational marijuana legalization, and the state officially legalized recreational marijuana in December 2023. 

Adults over the age of 21 can therefore purchase and possess cannabis without a medical license. However, they are still subject to certain limits.

Possession is limited to 2.5 ounces in any form. The exception is THC extract, which has a limit of 15g. 

Importantly, adults are only allowed to buy 2.5 ounces from a dispensary each day. Be careful not to sell an individual more than that.

Cannabis Regulation in Ohio

Those laws are just the beginning when it comes to cannabis control. The regulations surrounding cannabis dispensaries in Ohio are long and can be quite confusing.

Let's cover some of the most important. 

The Kinds of Dispensary Licenses in Ohio

There are four kinds of marijuana licenses in Ohio: Dispensary, Processor, Cultivator Level 1, and Cultivator Level 2. Each of these licenses allows the licensee to do different things.

Fortunately, Ohio allows licensees to acquire multiple licenses. That means you could theoretically become vertically integrated. In other words, you could grow, process, and sell marijuana yourself.

However, each license costs money and comes with different requirements.

Fees for Cannabis Business Licenses

The Cost of Ohio Cannabis Dispensary Licenses

Cannabis dispensary licenses have three kinds of cost associated with them:

• Application Fee: This is the cost to submit your application. It doesn't guarantee you'll get accepted, and has to be paid with each new application, so make sure your application is watertight!
• Licensure Fee: Also called the certificate of operation. This is the cost to actually acquire your license.
• Renewal Fee: A recurring cost required to maintain your license. In Ohio, medical marijuana dispensaries must pay this every two years.

These three fees vary depending on which of the four licenses you want to get. For medical marijuana dispensaries in Ohio, the costs are as follows:

• Application Fee: $5,000
• Licensure Fee: $70,000
• Renewal Fee: $70,000. If you're late, you need to pay $10,000 more.

That might seem steep, but it's actually not that expensive compared to some other states. New York, for example, has fees as high as $200,000!

On the other hand, Alaska has fees as low as $1,000. By that metric, Ohio is pretty pricey. 

That's not all, either. There are various other fees that dispensary owners in Ohio need to be aware of.

Other Fees Associated With Marijuana Dispensaries in Ohio

Various other fees are levied by Ohio. There are fees associated with employees, changes in ownership, relocation, advertising, and more. 

Here are some key fees:

• Change in Ownership: $5,000
• Relocation: $5,000
• Renovation or Other Major Modification: $5,000

Maybe you're seeing a theme here. A flat five thousand seems to be the standard fee under Ohio dispensary laws. Well, let's mix things up a bit with some other fees you'll have to pay as a medical dispensary owner:

• Advertising Approval: $100 per advert
• Employees: $500 for an "associated key employee," $250 for a "key employee," and $100 for a "support employee." You'll have to pay a renewal fee of the same amount every two years.

Phew! That's a lot of fees. 

Transitioning From a Medical to Recreational Cannabis Dispensary

Because Ohio already had medical marijuana dispensaries, lawmakers provided a way for existing medical marijuana operators to also get permission to sell recreational marijuana. 

This is true for processors, testing labs, cultivators — and, yes, dispensaries. Current medical marijuana dispensaries still need to apply, though some of the fees listed above might not apply. 

Cannabis Business Compliance

In order for your application to be accepted, you need to ensure your dispensary meets a long list of requirements.

Application Requirements

It almost goes without saying that you'd prefer not to waste $5,000 on an unsuccessful application. To save your money, ensure your dispensary meets the following requirements:

• Location: Dispensaries can't be within 500 feet of schools, public libraries, religious worship centers, public parks and playgrounds, or facilities providing community addiction services. 
• Testing: You must prove you're connected with a licensed laboratory that will test your products. Otherwise, you need to apply for a lab testing license yourself.
• Personal Information: You'll be asked to provide a wide range of information about yourself, your business, your employees, and so on. Make sure to provide everything that's asked for, and ensure everything you put down is up to date and truthful. 
• Tax: You'll need to demonstrate that you're compliant with cannabis dispensary tax laws. 
• Legal History: You and your employees may be required to undergo a criminal records check. Some offenses, though not all, are disqualifying. Furthermore, some disqualifying offenses might be looked over if they happened over five years before you apply.

Waste Disposal Requirements 

The cannabis market can be brutal. Sometimes, you'll have great products that just don't sell. What do you do?

Under Ohio law, disposal of adult use cannabis must follow certain protocols. 

• Recorded: Disposal must be done under video surveillance.
• Tracked: Everything you dispose of must be tracked and submitted to the state's tracking system.
• Secure: Store everything you are going to dispose of in a secure location.
• Non-Usable: You can't just throw cannabis into the trash. It has to be ground up and then mixed with some other eco-friendly waste product until the resulting mixture is at least 51% non-cannabis. Permitted waste products include paper, cardboard, food, and grease.

Tracking Requirements for Recreational Dispensaries

Under Ohio law, adults can grow up to six plants. That means licensed retailers can sell seeds and even live plants.

It also makes it even more important for the state to regulate and track marijuana products at every stage, from seed to sale.

In fact, that's literally the name of marijuana business tracking programs: Seed-to-Sale. 

What does that mean for you? Well, you'll have to keep track of your products at every step of the journey. That journey involves three stages:

1. Transportation to your dispensary. That could be from a cultivator, distributor, or from yourself, if you're cultivating your own plants.
2. Storage in your dispensary. Keep track of everything you're selling!
3. Handing over a product. There are three possible endpoints:
   1. A product is sold to a customer. Congratulations on the sale!
   2. A product is successfully delivered to a certified testing facility. They'll take care of tracking from there.
   3. A product is properly disposed of or destroyed.

That might sound like a lot, but don't worry. There's a system in place to help you manage all of this. Different states use different tools to track marijuana products.

Ohio opted to go with Metrc. 

Metrc stands for Marijuana Enforcement Tracking Reporting Compliance. It's a software platform that tracks every single point of the marijuana business supply chain. Remember, from seed to sale.

Metrc works by assigning an RFID tag to each product. These tags are unique and not reusable. You're responsible for buying them. They're about 30 cents per tag, though that cost can vary a little.

Plants receive a "plant" tag. When they're turned into a specific product, they receive a "package" tag. If you need to change a specific tag, you need to inform the Ohio Board of Regulations. 

You can see how these tags allow you — and, by extension, Ohio — to track all cannabis products. Metrc also allows you to record everything you sell.

In fact, you have to report all of your sales to Metrc, or you could be investigated and subject to some serious fines. You can either manually report all of your sales to Metrc or integrate it into your sales system.

What Every Dispensary in Ohio Needs

A sales system that can integrate with Metrc is just one of the many things your dispensary will need in order to become successful. 

Floor Plan

You've likely considered some aspects of your dispensary's layout. Some obvious considerations include how you'll display your product, where you'll actually make sales, and so on.

But there are actually three distinct parts of a dispensary, by law:

• Security: Your dispensary needs to have a secure area that is accessible only to authorized employees. These areas need to be constantly monitored by video and must be signposted so guests don't accidentally wander in. Oh, you also can't share photos of your secure area.
• Sales: Your sales area, where employees actually make sales, must be physically separated from the rest of your dispensary. Anything kept there, including cannabis, has to be secured and can't be visible from outside the dispensary.
• Retail: This is where customers can go. It's where you'll want to display your products. Make sure the layout is inviting and appealing.

Opening Hours

Ohio law allows dispensaries to be open as early as 7 AM and as late as 11 PM.

Customer Compliance

You can't just let anyone into your dispensary. Anyone entering your dispensary must present a valid, government-issued ID. You also need to check ID before making a sale or handing over a cannabis product.

Remember, the minimum legal age is 21. The only exception is for registered patients entering medical cannabis dispensaries. Registered patients over the age of 18 can enter with a valid ID and be accompanied by their registered caregiver. 

Drive-Thru and Delivery

You can ask Ohio's regulatory board to allow you to conduct sales via a drive-thru window. If you do, the entire drive-thru area must be under video surveillance and secure.

The same goes for curbside pickup.

Advertising

Unfortunately, you can't just come up with whatever ads you want. 

Your name, logo, signs, and ads must all be approved by the Ohio Board of Pharmacy. You can't do anything that might make marijuana attractive to underage people, like using cartoon characters.

There are also rules that are common to other industries, like being forbidden from making false statements about your products.

Packaging

Most obviously, packaging for your cannabis products has to be resistant to curious children. Specifically, children under the age of five must find it difficult to open your products.

Your packaging also has to protect what's inside from contamination, protect it from sunlight and other environmental damage, and contain some kind of tamper-prevention feature.

Make sure your packaging doesn't imitate any non-cannabis products. In general, it's best to stick to minimal, clear packaging.

Example of a Licensed Dispensary in Ohio

We've covered the main points of opening and operating a dispensary in Ohio, but there's still a lot to consider. What products will you stock? What's your business plan? How many dispensary employees will you need?

Sometimes, the best way to figure something out is to look at a successful example. 

If you're interested in learning from a successful dispensary in Ohio, come on down to our dispensary in Avon. We're open Monday through Saturday at 1431 Lear Industrial Pkwy, Avon, OH 44011.

Of course, if you want to pick up something while you're there, be our guest. We've got THC, CBD, gummies, edibles, flower, and much more — all tested by a third-party lab.

We look forward to seeing you!

Keep Reading: What Are The Next-Day Side Effects Of Delta 8?

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Disclaimer: All information provided is for informational purposes only and should not be considered legal, financial, or professional advice. Laws and regulations governing the cannabis industry in Ohio and the United States are subject to change, and it is your responsibility to ensure compliance with all applicable state and local laws. We recommend consulting with legal professionals to navigate the complexities of opening and operating a dispensary in Ohio.

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