Missouri Cannabis Startup Guide

Starting a cannabis company in Missouri? We’ve put together a state-specific guide covering everything from available license types to fees, requirements, and what you should include in a Missouri cannabis business plan. Jump to a section by clicking below, or go straight to our sample cannabis business plan.

Missouri medical cannabis business startup guide and planning banner

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Cannabis license types
Fees and other barriers to entry
Are cannabis business plans required in Missouri?
What to include in a business plan
How to research city regulations
Helpful links
Get expert help

Overview of legal cannabis in Minnesota

Missouri legalized medical marijuana in November 2018 by passing Amendment 2, but the program didn’t start until October 2020, delayed in part by the COVID-19 pandemic. Patients with physician approval can buy up to four ounces of marijuana every month, as well as grow up to six marijuana plants at home. Smoking, vaping, edibles, and infused products are all allowed.

Missouri has awarded its maximum number of licenses as of 2021, but the state has said it will increase the caps if demand warrants it. There are currently over 90,000 patients registered, and medical cannabis sales are expected to exceed $225 million in 2021.

Cannabis business license types

Missouri issues licenses for four broad categories of cannabis businesses: dispensaries, cultivators (aka grow operations), infused product manufacturers, and testing companies.

Dispensary: This is a retail storefront where patients can purchase marijuana. Dispensaries must follow strict state-mandated protocols for security, storage, sanitation, labeling, and packaging.

Cultivator: These businesses, also called grow operations, grow cannabis plants indoors or outdoors. Marijuana is then either sold through a dispensary or sold to an infused product manufacturer, which will create products to sell. Like dispensaries, grow operations also are required to keep thorough documentation and adhere to Missouri-specific regulations.

Infused product manufacturer: Cannabis manufacturers produce items like edibles, capsules, and oils. Manufacturers wholesale these products to dispensaries.

Testing facility: Consumers and regulators alike demand consistency and quality control in cannabis products, which creates demand for marijuana testing labs. These labs use methods like liquid or gas chromatography to analyze products for CBD and THC content, pesticides, terpenes, bacteria, fungi, and heavy metals, to name a few.

Ancillary business: If you don’t want to grow, process, test, or sell cannabis in Missouri, there are plenty of other ways to be part of the state’s cannabis industry. You can create a marijuana app, payment processing service, consulting firm, pest management product, accounting firm, automated plant watering system, security service, packaging labeling service, or legal firm--and that’s just the tip of the iceberg!

Fees and other barriers to entry

Application fee: Applying for a cannabis business license in Missouri costs $6,000 for a dispensary or product manufacturer and $10,000 for a cultivation facility (no fee is listed for a testing lab).

Annual license fee: It’s $25,000 each year for a medical cannabis cultivation license in Missouri. For a dispensary or product manufacturer, it’s $10,000 each year.

Tracking: The Missouri Department of Health requires the use of a seed-to-sale tracking system, with several third-party solutions available including BioTrack and Metrc.

Background check: Applicants must submit fingerprints for a state and federal criminal background check.

Do you need a cannabis business plan in Missouri?

A business plan is required to get a medical marijuana business license in Missouri if you want to run a grow operation or dispensary, but not for a testing facility or infused product manufacturer. If you plan on raising funding from investors, you definitely need a business plan.

What to include in your business plan

Here’s what a marijuana business plan should include:
  • Product/service description: Will you run a dispensary, grower/processor, or something else? What’s unique about your business? Be as specific as you can. If you’ll open a marijuana dispensary, which products will you sell?

  • Market research: If you’re opening a dispensary, how many people live within five miles? If you’ll create oils or pills, how many dispensaries will you sell to? If you’re creating an app, who will be the user base, and why would they use your app instead of someone else’s? Use concrete numbers verified by a third party whenever possible (instead of estimates).

  • Competitors: Who will you compete with, both directly and indirectly? What do they do well and poorly? What is their online reputation? How will you differentiate your company?

  • Management team: Summarize your qualifications and those of others on your management team. (Think of it as a shorter, “greatest hits” version of your resume.) Obviously include cannabis industry experience, but it’s fine if you don’t have any. Highlight leadership skills, customer service, and business development experience in other industries.

  • Financials: This part can be tricky. You need a five-year financial forecast, including projected annual revenue, operating expenses, costs, and net profit. Each year’s projected revenue should include not only revenue but also your margin and direct costs. You can forecast revenue by estimating how much product you think you’ll sell (based on market potential), your retail price, your production cost, and how much you’ll spend on payroll, rent, and other expenses. Your cash flow statement will show that you’ll have enough cash to stay operational. You might want to include a sensitivity analysis (best- and worst-case scenarios), which shows 15% higher and 15% lower revenue than your initial forecast. For marijuana cultivators, it’s important to do a sensitivity analysis based on future potentialities of prices. You can also include a break-even analysis, showing which month you will be profitable.

  • Missouri-specific requirements: If not included elsewhere in your application, you should include details in your business plan about your security system, product tracking, secure product transport, waste plan, and anything else required.

  • Investor proposal: If you are presenting your plan to investors, how are you valuing the shares? Consult with your attorney to make sure you are within state and federal compliance. Sometimes, you’ll need your attorney to draw up an offering memorandum, often called a private placement memorandum (PPM). A PPM informs potential investors on the details of the investment vehicle (your company) and potential risks associated with the investment.

How to research city regulations

Google your city or municipality name and “cannabis regulations” or “marijuana laws.” If your city or municipality’s website doesn’t have information about cannabis, check recent local news coverage or contact your city clerk, city manager, or town hall.

Helpful Links

Get expert help

Confused or overwhelmed yet? That’s normal. With such a highly regulated industry, and one with different rules in every state, starting a cannabis company can be very complex. Get help with your cannabis business plan from Masterplans, the industry leaders. We’ve worked with hundreds of cannabis entrepreneurs like yourself to create investor-ready documents and presentations so you can not only meet regulations but get the funding you need. Click below for your free, confidential consultation:

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