The New Mexico cannabis is officially a billion-dollar industry. Governor Michelle Lujan Grisham announced the record-breaking sales in March 2024. This happened less than two years after the state legalized adult-use cannabis.
Opening a dispensary in New Mexico during the green rush is a strategic move, but it involves obtaining a license and navigating the start-up process. Understanding the process is key whether you’re a local entrepreneur or new to the industry.
We’ll walk you through the necessary stages to open your dispensary in the state. This comprehensive guide will be divided into three parts: the licensing process, the business way of starting a dispensary, and the New Mexico cannabis laws to be observed during the operational stage of your business.
Medical Cannabis
Yes
Recreational Cannabis
Yes
Hemp-Derived
Yes
License Application
Yes
How to Get a New Mexico Cannabis Retailer License
Securing the proper New Mexico cannabis licenses and permits is paramount in launching your dispensary in New Mexico. The Cannabis Control Division’s (CCD) online licensing system, NM-PLUS, processes applications, making the licensing process more efficient.
| 🧑🦽For Individuals Experiencing Physical or Cognitive Disabilities There is a special accessibility lane in processing licenses for individuals experiencing physical or cognitive disabilities. They may contact [email protected] for assistance. |
Follow the steps to apply:
Step 1: Review the New Mexico Cannabis License List
Before creating an account with NM-PLUS, check the “New Application Checklist.” The list includes the documents you must submit and your eligibility as an NM dispensary owner. This will help you decide whether to proceed with the licensing application.
Step 2: Secure A Business Local Permit
Before securing that state-wide license in New Mexico, the locality in which you plan to set up your business’s dispensary should permit you to operate first. Complete the requirements of the local jurisdiction to qualify for a local permit.
Most cities and towns in New Mexico don’t prohibit commercial cannabis, but they can cap the density of cannabis businesses in their vicinity. This convenient feature gives aspiring owners more chances of getting license approval.
Step 3: Gather the Information & Documents Asked in the New Application Checklist
Recheck the “New Application Checklist” and gather all the documents listed in the pdf. Here’s the contracted version of the checklist.
- Certification of Good Standing
- Certification of Registration from the New Mexico Taxation and Revenue Department (TRD)
- Verification of Sole Proprietor
- Verification of Corporation
- Verification of Limited Liability Company (LLC)
- Verification of Partnership
- Verification of Non-Profit Organization Exemption
- Cannabis Application or License Adverse Action Supporting Documentation
- Proof of Age
- New Mexico Department of Public Safety (DPS) Background Check
- Felony Conviction Documents
- Business License / Zoning Approval
- Vehicle Description, Registration & Proof of Insurance
- Plan for Delivery and Security
Step 4: Create An Account With NM-PLUS
The CCD relies on an automated licensing system called NM-PLUS to simplify the process of applying for a new retail dispensary license. As a one-stop-shop system, the NM-PLUS system can be used to apply, amend, and renew licenses.
| 🔖 Note CCD has long stopped accepting paper applications for licensure, amendments, and renewals. Only courier, consumption area, and cannabis research and laboratory licenses are available in paper format. |
This is how you create an account with NM-PLUS:
1. Enter the URL in your browser: https://nmrldlpi.my.site.com/ccd/s/login/
2. Click the underlined “Self Register.”
3. Accurately provide your personal information in the registration form. After completing this, check your email box and sign in using the password sent by [email protected]. Check the junk or spam folders if the message doesn’t pop out.
Step 5: Register Your Business
After entering the portal, you will need to register your business. Go to the “Cannabis Businesses” option and click the “Add Business” button. This will launch a form in which you must fill out two parts: Business Information and Controlling Person Information.
Click the “Next” button below to go to the following pages of the form.
Step 6: Submit The Documents Required from The “New Application Checklist.”
Log in again to the portal using the surname and password you set. From the navigation bar, click “Applications” and “Apply for a License” once the drop-down menu appears.
Read the instructions on top of the page and click “Select” next to the “Cannabis Retailer” option.
You will be taken to the pre-screening page to start the Cannabis Retailer Application process. Answer the pre-screening questions, introduction, business information, employee information, questions, and premise information.
Upload the documents asked under the “Upload Documents” section.
Next is “Attestation.” Please read and acknowledge the terms by clicking the checkbox and signing with your complete name.
The last screen is “Payment.” Here’s the breakdown of the licensing fees.
| Application Fee | $2,500.00 |
| Premises Fee | $1,000.00 |
Choose the mode of payment within the options offered (Credit Card, E-Check, and Cashier’s Check) and click “Pay and Submit.” CyberSource will then be launched to ask for the billing information.
After filling out the billing form, click the button “Next” to be directed to “Payment” and the following pages. A screen with the following message will be shown after clicking “Pay” in the “Review” section.
| 🔖 Note It takes around 90 days to receive a response regarding your dispensary license application within New Mexico. The process can vary based on the complexity of your application and other factors, such as the volume of applications received by the CCD. |
Step 7: Check Application Status
You can check the status of your application by logging in to the portal. Once approved, your inbox will receive an email detailing how to access the digital copy of your cannabis retailer license.
Step 8: Mandatory Annual License Renewal
Licensees are required to renew their licenses yearly.
How to Establish a Dispensary in New Mexico
Let’s go to the steps of establishing your dispensary in New Mexico.
Step 1: Crafting a Comprehensive Business Plan
Although CCD doesn’t really require a business plan for the license application, a solid business plan serves as the foundation of your dispensary’s success.
This document should encompass all facets of your operation, from secure financing sources to detailed growth strategies. Identifying your target audience, analyzing competitors, and projecting initial financial needs are crucial components.
Don’t underestimate a business plan document. It can attract investors, offering them insight into your business savvy and potential for long-term success in the market.
Additionally, consider incorporating a risk management plan, identifying potential business risks, ensuring compliance with evolving legislation, and securing your operation against unforeseen circumstances.
New Mexico doesn’t mandate specific insurance for cannabis businesses, yet acquiring such protection can safeguard your investment against legal and operational perils.
Step 2: Finding the Perfect Location
Selecting the optimal location for your dispensary should have been done after reviewing the “New Application Checklist” in Step 1 of “How to Get a New Mexico Cannabis Retailer License.”
Factors to consider include visibility, accessibility, and adherence to local zoning rules. In New Mexico, dispensaries must be located at least 1,000 feet away from sensitive sites such as schools and churches.
Collaborate with a local real estate expert familiar with cannabis zoning laws to streamline your site selection process. Ideal locations should align with your business strategy and project a positive image for your brand, fostering customer engagement and maximizing foot traffic.
Real estate in high-traffic areas or cities like Santa Fe or Taos might be pricier, so factor in both upfront and ongoing costs, including renovations and rentals.
Legal stipulations may restrict operational times and density of cannabis enterprises, impacting your operations. Incorporate these zoning requirements and financial considerations into your overall business plan, as these elements can significantly shape your operational potential and growth capacity.
Step 3: Designing an Inviting and Functional Space
The design and layout of your dispensary play a role in molding the customer experience and driving sales. Your dispensary should reflect your brand’s vision and values while providing a seamless and engaging customer journey.
When planning your space, consider how customers will navigate through the store, how products will be showcased, and where secure inventory will be stored. This thoughtful arrangement not only enhances operational efficacy but also heightens customer satisfaction.
Step 4: Building a Team
The success of your dispensary heavily relies on the quality of your team. Hire individuals who have sound knowledge of cannabis and good customer service skills. An informed staff enriches the customer experience while ensuring adherence to legal guidelines.
Training programs should be placed to educate staff about compliance with New Mexico’s cannabis regulations, product knowledge, and the importance of always providing exceptional service.
Budtenders make around $14 an hour in New Mexico-based dispensaries but prepare to pay more for stellar applicants.
To ensure legal and smooth operation, you must hire compliance officers, a security guard, and managers in addition to budtenders. Although the law doesn’t really require you to hire a security guard, it’s a good addition to maintaining peace on the floor.
| 📚Related Blog Know the minimum age for a budtender or similar positions in New Mexico in this listicle. |
Step 5: Sourcing for Your Cannabis Supply
One of the crucial challenges of selling weed is finding a good supplier of quality cannabis. New Mexico has cut the scale of cannabis production in the state, and the unlimited number of retailer licenses is outpacing supply. Dispensary owners are paying as high as $4,000 for a pound.
Step 6: Marketing Your Dispensary
Marketing your dispensary effectively is essential to stand out in New Mexico’s competitive cannabis market.
Utilize digital platforms to reach diverse audiences while adhering to state marketing laws that restrict targeting minors.
Consider community engagement and local partnerships to strengthen your brand presence. Implement a multifaceted marketing strategy incorporating social media, local collaborations, and engaging educational content to build and maintain a loyal clientele.
New Mexico Dispensary and Consumer Laws to Follow
Before starting a dispensary in New Mexico, familiarize yourself with the state’s cannabis laws. Knowing the operational New Mexico dispensary requirements will help you avoid pitfalls and ensure your venture operates within legal boundaries.
Here are some of the relevant New Mexico cannabis laws to apply as you go along with your business’s day-to-day operations:
Consumer Laws
New Mexico has been actively embracing cannabis legalization since 2007 when the Lynn and Erin Compassionate Use Act allowed medical cannabis. Fast-forward to April 2021, when the state legalized recreational cannabis through the Cannabis Regulation Act, permitting adults aged 21 and older to possess and consume for leisure purposes.
Consumers are restricted to buying a maximum of the following per transaction:
- 2 ounces of cannabis
- 16 g of concentrate
- 800 mg of edibles
- 6 immature cannabis plants (per 16.8.2.40 H)
There is no monthly or weekly limit, and possession at home is unlimited, provided that the cannabis products are stored and not displayed publicly.
Tax Laws
Sales of medical cannabis are exempt from excise taxes, but those of adult-use cannabis are subject to a 12% excise tax. This is on top of the standard gross receipts tax businesses pay. For your reference, the state sales tax in New Mexico is 5%, and the highest local tax rate is 4.3%.
| 📚 Related Blog: Learn how much dispensaries pay in taxes per state here. |
Dispensary Security Regulations
New Mexico has laid out dispensary security requirements all cannabis establishments must apply. Here are some of the most important ones:
- Install security alarms directly linked to law enforcement.
- A 24/7 video surveillance of every angle in each room within the dispensary.
- Rules about locks, vaults, and building maintenance.
Marketing
The marketing and advertising rules of cannabis in New Mexico are pretty straightforward and are divided into three parts: the required practices, prohibited practices, and cannabis business branding.
| Required Practices | Prohibited Practices | Cannabis Business Branding |
| All Ads and marketing materials (digital or physical) should have the brand’s name, clearly and legibly. | Advertising in mainstream media like television or radio. | Branding shouldn’t contain cartoons or characters that appeal to minors. |
| All print and digital materials should only be displaced in a place where at least 70% of the audience are 21 years old or older. | Misleading or vague advertising. | Any resemblance to any product that appeals to minors. |
| It should include the statements and warnings specified by the state. | Making unsubstantiated medical claims. | It shouldn’t contain symbols, images, celebrities, that appeal to minors. |
| Advertising signage like billboards shouldn’t be posted within 300 feet of educational institutions and churches. | ||
| Containing symbols and celebrities that appeal to minors. | ||
| Use predatory themes, targeting minors. | ||
| Modeled after other brands. |
Your New Business Adventure Begins!
Entering the dispensary business in New Mexico is a multifaceted journey of opportunities and challenges. Following these steps, you can navigate the process smoothly and build a successful and compliant operation.
Remember, thorough planning, knowledge of local regulations, and a passion for the industry are your allies in this venture. Good luck as you embark on this exciting new path!
FAQs
Can anyone open a dispensary in New Mexico?
Yes, as long as you have successfully obtained a cannabis retailer license.
How much does it cost to own a dispensary in NM?
In New Mexico, opening a dispensary can cost up to $450,000 upfront expenses and $42,000 per month for operational costs.
How much do dispensaries make in New Mexico?
No data shows exactly the profit dispensary owners rake in. However, as of 2024, New Mexico’s combined sales of recreational and medical cannabis reached over $1 billion.
What is the cheapest state to open a dispensary in?
According to online reports and literature, Oklahoma, Colorado, Michigan, and Oregon are the cheapest states to open a dispensary.
How to open a recreational dispensary in New Mexico?
You have to create an account with NM-PLUS, answer the information asked for, and submit the list of requirements in the “New Application Checklist.”
