Cannabis licenses vary from state to state because cannabis has yet to become legal in all 50 U.S. states. New Jersey businesses can sell cannabis when they have the appropriate permit. One of the confusing aspects of selling cannabis in New Jersey is that every facet of the industry needs something different when it comes to permits. We’re going to break down 4 ways to legally obtain a cannabis permit in New Jersey depending on the type of business you operate.
#1 — The Cannabis Wholesaler License
If your business includes a warehouse where cannabis products will be stored, then you will need a cannabis wholesaler license. This license permits owners to purchase cannabis as well as cannabis products to store them in a warehouse. The goal is that these businesses can also resell but only to cannabis retailers and not to customers. Wholesaler licensees do have to share their storage plan with the state in order to be approved.
With a wholesaler license, you can sell your cannabis items at a wholesale price with sales certificates so that you won’t have to pay sales tax on your sales. Most of the companies who want a cannabis wholesaler license want one because they are growers and they want to be able to sell their product to retailers at a wholesale price. This license does not allow businesses to sell to customers.
#2 — The Cannabis Retailer License
If your business will be selling directly to customers then you will need a cannabis retailer license. This is a Class 5 license that allows businesses to purchase cannabis in order to sell it directly to customers. A retailer license allows you to set up shop and have your customers come into an onsite facility in order to buy their weed, cannabis edibles, cannabis pre-rolls, cannabis lotions, and other cannabis goodies. You cannot operate a storefront without a retailer license.
The retailer license is the license that most businesses need (think dispensaries). This license tends to require the most paperwork and can be the most difficult to get because customers are directly involved in the sale. You may be required to share information about your storefront as well as the type of cannabis products you will have on display. The retailer license is also the most expensive license with an annual retailer licensing fee of $10,000.
The application requirements for a cannabis dispensary and cannabis retailer license in New Jersey are extensive. Beyond the application fee and annual fee, applicants must also submit a business plan. These business plans have to detail every aspect of the future operation, which can be difficult for business owners to create. If you are planning on applying for a retailer license, we recommend using NJ cannabis legal counsel to ensure that your business plan covers every aspect needed for approval. New Jersey is not taking these applications lightly and most applications are being rejected.
#3 — The Cannabis Transporter or Delivery License
A Class 6 cannabis transporter or delivery license will give businesses the option to deliver cannabis orders to customers. This type of license is necessary if you plan to deliver products to your customers. Whether you want to deliver across the state or simply deliver to local customers, you still need a cannabis transporter or delivery license.
Some business owners have tried to skirt around this license by using individual couriers without designated company vehicles, but this is illegal in NJ. Make sure that if you will be delivering products to customers, you get a cannabis transporter or delivery license.
#4 — The Vertically Integrated Permit
As New Jersey continues to perfect its cannabis regulation laws, things are constantly in flux. One way to speed up the process is to use a vertically integrated permit. Vertically integrated permits make it possible to apply for several licenses and to own more aspects of the business. This is particularly important for businesses who want to create their own cannabis establishment where they own everything from the initial seed to the final sale of the product.
Vertically integrated permits give businesses the possibility to grow their own cannabis from seeds, move that cannabis to warehouses for storage purposes, sell directly to customers on-site, and operate a delivery service. Even if you do not plan to own every aspect of the cannabis growth-to-sale pipeline, you might find it beneficial to obtain a vertically integrated permit if you plan to use more than one license. It’s important before moving through the licensing process that you have a clear idea of what your business will entail. If you do need more than one license, the vertically integrated permit is the way to go.
How to Apply
You can apply for your permit license by visiting the official website for the state of New Jersey. The Cannabis Regulatory Commission provides options for each license and offers a Notice of Application. Before you apply, you will need to determine your eligibility and work your way through a pre-application checklist. Once you have figured out what licenses you need and gathered all of your documents, you can apply for the business license online.
This process can be confusing and time-intensive, which is why many new businesses hire NJ cannabis lawyers to take care of all of the paperwork. Before you can begin to grow, store, distribute, or sell cannabis and/or cannabis products, you must be in good standing with the state and have active licenses. Applying for these licenses with the state of New Jersey allows you to operate in the state of New Jersey. The site is fairly straightforward, but applications are not always accepted even when filled out correctly. Applications take a minimum of 90 days to review in most cases and may take longer if there is a backlog of applicants.
In New Jersey, the permit timeline varies. If you are able to secure a vertically integrated permit then you may not need to wait as long to open your business. You should not begin to operate until you have officially secured your permit. Because the timelines for permits vary, we recommend that you do not set a “store opening” date until you have received your official license. You can set up your social handles, website, and other marketing materials but leave the “store opening” date blank until you have your permits in hand.
For more information on how you can legally obtain the necessary cannabis permits in NJ for your cannabis company, contact us today. Our New Jersey cannabis lawyers and legal team can help you secure the permits you need to operate safely selling cannabis.