Starting a cannabis company in Michigan? We’ve put together a state-specific guide covering everything from available license types to fees, regulations, and what you should include in a Michigan cannabis business plan. Jump to a section by clicking below, or go straight to our sample cannabis business plan.
Medical marijuana use has been legal in Michigan since 2008, but companies have only been able to get cannabis business licenses since 2016. Currently, Michigan patients with a certification from a qualifying doctor can possess up to 2.5 ounces of usable cannabis. More than 245,000 patients have registered for medical marijuana use.
Adult-use cannabis was legalized in January 2020, but the program’s implementation has been slow. For example, Detroit, the state’s largest city, applications weren’t accepted until January 2021. Under its laws, adults over 21 can posess up to 2.5 ounces of cannabis and grow up to 12 plants in their homes. It is estimated that there are as many as 1.5 million cannabis customers as of 2020, and recreational sales are expcted to to $1 billion in 2021. There are no restrictions on the types of marijuana that can be sold in the state of Michigan.
Note: Michigan’s medical program spells marijuana “marihuana” because that’s how it’s spelled in the Marihuana Tax Act of 1937. However, either of the two spellings are deemed acceptable.
Michigan offers five main licenses for both medical and recreational cannabis: growers (aka cultivation), provisioning centers (aka dispensaries aka retailer), secure transporters, processors, and safety compliance facilities.
Growers: These businesses, also called grow operations or cultivators, grow cannabis plants indoors or outdoors. Marijuana is then either sold to a processor or “provisioning center” (dispensary).
Provisioning centers (aka dispensaries aka retailer): This is a retail storefront where cannibis products can be sold. For its medical license, Michigan refers to the retail operation as provisioning centers. Retailers must have cannabis tested and labeled before selling it to the public. They can’t sell alcohol or tobacco products, just cannabis.
Processors: Processors buy cannabis from licensed growers, then process and/or create infused products and sell them to retailers.
Secure transporters: These businesses transport marijuana between licensed medical cannabis companies (such as from a grower to a retailer). They must follow strict regulations, such as entering a route plan into Michigan’s monitoring system and carrying cannabis in sealed containers.
Testers/safety compliance: Safety compliance facilities have to be accredited. After that, they can test cannabis for CBD and THC content, fungicides, insecticides, mycotoxins, and other elements.
If you don’t want to grow, test, transport, process, or sell cannabis, you still have plenty of options. You can create an app, payment processing service, advertising and branding agency, ad network, consulting firm, pest management product, automated plant watering system, security service, packaging and labeling service, or anything else you can think of -- the sky’s the limit.
Local governments may forbid cannabis companies or certain locations, so check city and county regulations.
Application fees: All license types have to pay $6,000 in application fees, whether they are recreational or medical.
License fees:License fees for medical cannabis are based the amount of cannabis the business transfers. For growing, annual fees will range from $10,000 to $67,000; for retail, it ranges from $45,000-$67,000; for processors, it ranges from $45,000 to $67,000; and for tranporters, it ranges from $36,000-$52,000. Safety compliance facilities have no fees.
For adult use cannabis licenses, annual fees for cultivation are $3,000-$50,000, $30,000 to $50,000 for processing, and $20,000 to $30,000 for retailers, ransporters, and safety compliance facilities.
Tracking: Michigan requires cannabis businesses to use a third-party inventory control and tracking system called Metrc (more details here).
Chauffeur’s license: Businesses seeking a secure cannabis transport license have to ensure each of their drivers has a Michigan-issued chauffeur’s license.
A business plan is not required to get a medical marijuana business license in Michigan, but it will certainly make the process easier. Your application already has to include a facility plan, technology plan, marketing plan, staffing plan, and inventory and recordkeeping plan, some of which naturally overlap with a business plan. And if you plan on raising funding from investors, you definitely need a business plan.
Here’s what a Michigan medical marijuana business plan should include:
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.
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: