Rhode Island Projections Shed Light on Dispensary Startup Costs, Annual Revenues
Want to get an idea of startup costs, revenue potential and other financial data tied to launching and running a medical marijuana dispensary?
Look to Rhode Island.
Documents filed recently by two groups planning to open dispensaries in the state – the Thomas C. Slater Compassion Center and Greenleaf Compassion Center – provide a snapshot of the financial side of the medical marijuana business. The documents feature updated business plans that include everything from expected startup expenses, revenues and breakeven timelines to estimated number of patient visits annually.
The Slater center plans on a relatively large operation with a substantial grow operation, while Greenleaf is going much smaller and is buying its initial cannabis inventory from caregivers.
Here are some highlights from their estimates: (Note – For a detailed overview of financial information and exclusive data about the MMJ industry, check out MMJ Business Daily’s Marijuana Business Factbook 2013, which will be released March 20.)
Initial startup expenses
Slater: $1.6 million, including $660,000 in build-out costs, $500,000 in working capital and $440,000 for equipment
Greenleaf: $120,000, including $56,000 for payroll and $25,000 to purchase 200 ounces of cannabis
Startup expenses during ramp-up
Slater: $1.1 million
Sampling of startup expenses during ramp-up
Slater: Security ($434,375), payroll ($291,120), cannabis growing and processing ($97,200), leaseholding expenses ($73,333), community outreach ($72,842) and utilities ($28,800).
Greenleaf: Payroll ($241,872), leasehold expenses ($50,000), office expenses ($26,130), supplies ($20,800), equipment ($10,088) and consultants ($7,280).
Slater: $1.6 million loan from investor/board member
Greenleaf: $200,000 loan from principals/management team
Revenues in first full year
Slater: $2.6 million (including $2.4 million in cannabis sales to registered patients and $240,800 in sales of paraphernalia and other goods)
Greenleaf: $1.25 million (including $1.24 million in cannabis sales to registered patients and $12,000 in sales of paraphernalia and other goods)
Revenues in second full fiscal year
Slater: $3.9 million, or 50% growth
Greenleaf: $2.15 million, or 50% growth
Breakeven (note: the centers are nonprofits)
Slater: Second full fiscal year
Greenleaf: First full year
Number of patients in first full fiscal year
Number of patient visits in first full fiscal year
Size of center
Slater: 13,750 square feet, including 5,000 for retail cannabis sales and 5,600 for cultivation
Greenleaf: 2,800 square feet
Number of full-time equivalent workers (first full year)
Rhode Island initially approved three dispensary applicants, but the state’s governor halted the program in 2011 over concerns that it conflicts with federal law. Now the program is back on track, and Greenleaf and the Slater center are gearing up to open soon.
Both centers recently submitted changes to their initial applications from several years ago, providing detailed updates to their business plans as required by the Rhode Island Department of Health.
While startup costs and other financial data vary greatly depending on many factors including location, local regulations and the scope of the operation, these projections provide insight into the financial side of an industry where there’s a dearth of such information.
The chances that Pennsylvania could become one of the next states to legalize medical marijuana [click to continue...]
Another mainstream investment firm is hoping to cash in on the cannabis industry. Tao Capital [click to continue...]
The former TV reporter who generated controversy last fall when she quit her job on-air [click to continue...]
Well that was quick. MBank, the Oregon-based financial institution that recently announced it would begin [click to continue...]
Entrepreneurs continuing the fight for medical marijuana in Florida have found an ally in Republican [click to continue...]
It’s official: Native Americans are getting into the marijuana industry. The Pinoleville Pomo Nation announced [click to continue...]
Former Illinois Gov. Pat Quinn, who left office earlier this month without granting medical marijuana [click to continue...]
How popular is the marijuana business in Colorado? Here’s one indication: A single county that [click to continue...]
Medical and recreational marijuana sales jumped 74% last year to hit $2.7 billion compared with [click to continue...]
Fearing legal repercussions if their users break the law, Instagram and Apple’s App Store are [click to continue...]
How’s this for irony: A lawmaker has introduced a bill to legalize medical cannabis in [click to continue...]
Marijuana Business Media has launched its annual survey of cannabis professionals to gather key financial, [click to continue...]
Washington State recreational marijuana shops have been struggling underneath a heavy tax burden, but state [click to continue...]
A New Jersey union has filed a grievance alleging unfair labor practices against a dispensary [click to continue...]