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New medical marijuana dispensaries burdened with regulations

Starting a business in New Jersey can be complicated. Not only do potential business owners need a business model and idea, but they need capital to make it happen. Once they have those things in place, business formation requires that they decide what type of entity they want the business to be. For example, new business owners can choose to make their business a limited liability company, a corporation or partnership, among other types of entities. Depending on the type of entity people choose for their businesses, different paperwork is required to legally establish it.

Furthermore, certain businesses must also have licenses, or comply with other regulations and similar issues, through local, state and federal governments. Owners must apply for and obtain these licenses before they can open or operate. Without governmental permission and cooperation, businesses can see all chance of success fade away.

New Jersey’s medical marijuana dispensaries have seen firsthand how important interactions with the government can be when starting up a business. These dispensaries will be growing and distributing medical marijuana to New Jersey residents who have a doctor’s prescription for the drug and who have registered to receive the medication.

However, these dispensaries are finding that forming their businesses is not easy. According to state regulations, everyone involved in the business is subject to extensive background checks that have taken nearly eight months to complete in some cases. The state also has had to inspect and regulate every part of the business from planting to dispensing the medical marijuana.

This regulation has been so extensive that only one of the six planned dispensaries has even been allowed to start growing medical marijuana. However, before its owners can start to sell the medication, more governmental training, inspection and oversight are still necessary.

With the right planning, many people can avoid problems seen with the dispensaries when forming their businesses. They can go on to have successful and profitable businesses with very little hassle.

Source: Inquirer, “N.J. medical marijuana still faces hurdles,” Jan Hefler, Sept. 5, 2012

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