How Much Do Dispensary Owners Make?

The cannabis industry is ever-growing, with billions of dollars of revenue each year.

Just like any other business, cannabis businesses also strive to make a profit, and one of the most frequent cannabis-related business are dispensaries.

Due to laws and regulations, you can’t have dispensaries everywhere across the United States, but the majority of states allow you to open a dispensary.

There are over 25,000 dispensaries all across the United States. If you are looking to enter into the $19 billion cannabis industry by owning a dispensary, you are wondering about the economics of it.

This article will take a look at how much dispensary owners make and every detail surrounding the income of dispensaries.

How Much Do Dispensary Owners Make
How Much Do Dispensary Owners Make?

Average Income of Dispensary Owners

The thing about dispensary business is that their revenues and the dispensary owner’s income don’t change as much as we see in other industries.

There are still factors affecting your income and might put you on the low end or the high end, depending on it.

However, the low end and high end are not so different from each other like other industries, so it’s easier to get a clear number.

On average, dispensary owners make between $250,000 to $500,000 annually, depending on the scale of the dispensary.

Depending on several factors, a small percentage of dispensary owners take home close to $1 million.

An average dispensary makes anywhere between $1 million to $2.5 million annually. So this equals to about $1000 of annual revenue per square foot of space.

This shows the average revenues of dispensaries are way higher than some other businesses out there. 

Average Profit Margin

Judging by the numbers we provided above, the average profit margin for dispensaries is between 10% to 15%.

Many dispensary owners pocket 10% of annual profit, but in some cases, this number can go higher, about 15%.

Minimum profit margin

Minimum profit margin12%
Maximum profit margin21%
Average profit margin15%

The Cannabis prices also affect the profit margins quite a lot. As the market is quite new and it’s increasing rapidly every year, the prices of cannabis are quite volatile. This volatility affects the overall profit margin of the dispensaries.

Average Money Dispensary Owners Employees Earn

There are different jobs at any dispensary, from customer service to dispensary manager. Salaries vary quite a lot.

Basically, it depends on your job role, experience, location, and the size of the dispensary.

The average falls between $12.50 per hour for an apprentice, which is generally the lowest, to $21.80 per hour for a manager, which is generally the highest.

There are also chemists in some dispensaries, and their salaries generally are one of the highest.

Their average is about $90,000 annually. Depending on where the dispensary is, this could be well above $100,000 annually.

Factors Affecting Dispensary Owner’s Income

Factors Affecting Dispensary Owner's Income

A dispensary business might seem pretty straightforward, and there isn’t much stuff affecting your income.

However, that is not true, and there are some factors that affect the income of a dispensary and dispensary owners. By knowing these, you can take the right steps and help to keep a decent profit margin.


A dispensary in a small town with a very small target market has no way of matching the revenue numbers of a dispensary in the downtown of a big city.

In addition, your rent or mortgage payments will depend on where your business is located.

You have to research the location of your store very well and make sure that it’s worth your investment.


For any kind of business to be visible and attract customers all the time, a good marketing strategy is a must.

If you can do your marketing well and ensure that people see your store online or in the streets, you can increase your income a long way. Don’t be afraid to invest in your marketing.


The local competition is generally the killer of dispensary businesses or any other business, really.

If you don’t study the local competition well, what they are offering, their pricing scheme, and other things, you might fall behind easily.

Try to pick a location with less competition or with competition that you can easily win over.

Added Values

You are a dispensary, and you are selling cannabis, yes, but adding extra things on top of it, such as accessories or new cannabis products, could attract people.

Try to create discounts, packages, or beneficial things for your local customer. You can also create a loyalty program to give rewards to those that choose you all the time.

Tips to Maximize Dispensary Income

Tips to Maximize Dispensary Income

Dispensaries are not very complicated businesses, and it might seem like there isn’t much to do to optimize your income.

However, that is not true, as you might do a variety of things to make sure that you don’t fall behind.

Here are some tips to help you maximize your income.

  • Thoroughly research your competition: As we mentioned before, the cannabis industry is growing exponentially. With this growth comes strong competition. That’s why research what your competition is doing and adapt to the changing environment.
  • Have a diversified portfolio of products: Cannabis products come in different shapes. Try to have as many different products as you can in your dispensary. The more diversity, the more customer variety.
  • Focus on setting the right price for your products: Competition in the market means there will be a lot of changes in the prices to accommodate the market. Also, make sure to set the right prices for your products and keep the profit margin you want to have.
  • Try to be as efficient as you can with inventory: Always be aware of what is happening with your industry and operations. Try to streamline everything to reduce the cost and time you spend on these things.
  • Follow the trends of the technology: As the cannabis industry is quite new, combined with the technology means a lot of changes. Follow your customers’ preferences, integrate technology as much as you can, and set different profit margins on different sales channels.

How Much Do Dispensaries Cost to Open?

How Much Do Dispensaries Cost to Open

The average start-up cost to open a dispensary is about $750,000, but there are a variety of things that affect this cost.

The costs range anywhere from $100,000 to $2 million on average, from small dispensaries to big franchise dispensaries.

Start-up costs of a dispensary could include licensing, real estate, professional services, staff, equipment, marketing, product, and other similar costs.

Minimum start-up costs$100,000
Maximum start-up costs$2 million
Average start-up costs$750,000

Among these options, generally, the highest costs are staffing which is about $250,000, rent which is around $100,000, and about $50,000 to $100,000 for the renovation of the real estate.

Depending on your location, the size of the dispensary, and the estimated inventory, these numbers could go down or up.

However, some costs might not be in your control as they are tied to your jurisdiction.

It’s also important to remember that most start-up costs, such as licenses, equipment, and surveillance systems, are one-time fees and are not recurring fees.

Here is a breakdown of the average costs of each expected start-up costs:

Surveillance Systems$50,000

For example, the licensing column costs depend solely on your jurisdiction as their need for licenses will change from state to state.

Each state and jurisdiction has its own licensing needs, and their costs also differ, even if the license is the same with another state.


Dispensaries are slightly new businesses in an ever-growing $19 billion cannabis industry.

The industry doesn’t seem to stop, and the average revenue of $1 million to $2.5 million of dispensaries shows that it is indeed a big market.

Seeing these numbers, existing entrepreneurs or first-time entrepreneurs looking to own a business might want to take a bite from this pie.

The average money dispensary owners make from this average revenue is between $250,00 and $500,000, with a profit margin of between 10% to 25%.

It’s higher than most industries, and it’s fairly easier to run as a business than other industries.

So if you are thinking of owning a dispensary, it is definitely a lucrative business, and it might be a good call to go ahead and buy or build one.


How can you set the prices in the dispensary?

There are two ways you can do it; market-based or target-based.

Market-based pricing is about setting the prices based on the other dispensaries in the region or in the state.

Target-based is more delicate and requires extensive research because you price it according to your own profit or profit margin goals.

Are dispensaries profitable?

Looking at the average revenue and profit numbers, we can easily say that dispensaries are quite profitable.

The average profitability number is between 15% to 25%, depending on several factors.

Can everyone start a dispensary?

Dispensaries are not allowed everywhere because cannabis is not legal everywhere.

However, if you are in an area where it’s legal and if you get the necessary permits, anyone can open a dispensary.

It requires business management to a certain extent to not fail, but overall, anyone can open a dispensary.



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