Medically Reviewed by
Jason Crawford

Article Last Updated on January 4, 2023

Ever since the legalization and decriminalization of marijuana in several states, the cannabis industry has been thriving with no sign of stopping anytime soon. Making recreational and medical marijuana legal has opened up the way for many revenue streams in this niche, giving opportunities to cannabis aficionados to make a business out of it.

From CBD products to vapes and edibles, the marijuana industry has seen countless dispensaries pop up. If you’ve ever been curious about their work and how much they make or are thinking about starting up your own business, keep reading for some insight into this industry.

How Profitable Is the Cannabis Industry?

Marijuana use, either for recreational or medicinal purposes, is currently legal in 33 states in the US, meaning that a lot more people have legal access to cannabis. Consequently, the demand for weed and cannabis products resulted in an expansion of the cannabis market, as many dispensaries, both independent and chain stores, are opening up for business.

According to a 2016 report on Marijuana Business Daily, the average dispensary makes about $974 in annual revenue per square foot of store space. This puts them on the same level as what a chain store like Whole Foods makes in a year. In fact, Forbes has stated that by 2021, the industry will make a net profit of $31.4 billion. That’s pretty lucrative, so no wonder the industry is growing at such speed.

About Dispensaries

Dispensaries are somewhat akin to pharmacies in that they’re filled with bottles, jars, and packets with weed and cannabis products for medical and recreational use. The budtender who works there usually has a vast knowledge of the marijuana strains and products and is well informed about CBD and THC, and their effects. They can usually help you find what you’re looking for, give you some recommendations and tips for use, depending on what you need.

This model of cannabis shops was originally established in Amsterdam in the 1970s when they were called “coffee shops”. Nowadays, the censorship has faded and weed dispensaries are officially an outlet for buying cannabis products. However, unlike in the Netherlands, the customers aren’t allowed to consume the products on site, but only when they leave the premises.

Dispensaries can be either medical or recreational, and there is a big difference between them. Medical dispensaries work with patients who have a prescription for medical marijuana as per doctor’s orders. They will have a written document that serves as a confirmation for their diagnosis. Without the document, they can’t be given what they need.

Recreational dispensaries, on the other hand, cater to anyone over 21. That means that anyone can visit and buy recreational marijuana or whatever cannabis product they need without a doctor’s prescription. Basically, you only need to be old enough to buy weed or edibles, but that’s it.

Factors That Influence the Success of Cannabis Businesses

Owning a dispensary is quite competitive nowadays and careful planning and smart marketing can really make a difference. What this means is that branding and getting the word out there is crucial to getting customers and keeping them.

Business-wise, there are smaller (local) and bigger legal cannabis dispensaries that can be equally successful in their own respective lanes provided that they have a steady revenue. Medical marijuana dispensaries will always have some advantage over recreational cannabis ones because medical cannabis patients will need their medicine on a regular basis.

Besides hard work, inventory is also one of the most important factors for success. What you offer to your customers is what will make them want to keep coming back in the first place. There needs to be a variety of good quality products – plants, edibles, oils, vaporizers – the more the better, but carefully selected. The customers’ needs come first so that always has to be thought of first.

For larger-scale dispensaries, production is a more complicated process. This is because they usually have their own growing facilities, so they have to factor in utility bills, extra staff, and greenhouse costs. However, this also gives them better control of the products and a better chance of making more profits.

How Much Does It Cost to Open a Dispensary in the United States?

Opening a dispensary is very similar to starting any other type of small business, but a lot more expensive due to the many state regulations, initial investments, and application fees. The startup cost is anywhere between $150,000 to $2 million, depending on the size of the business, including $200,000 for annual staffing, $100,000 in yearly rent, and $50,000 for renovations.

Then there are the costs for your dispensary license application and getting the business license, as well as finding an actual retail space, remodeling it in accordance with the regulations, and hiring some staff. Of course, these costs may vary depending on the market.

Cannabis Industry Jobs and Salaries

There is a lot of variety in the cannabis industry when it comes to jobs. Let’s see some of the most popular ones and their salaries.

Marijuana Grower

Marijuana grower is one of the most popular jobs in the cannabis industry. Candidates who have experience in growing cannabis usually have an easier time adjusting to the business, but those who don’t have any experience will often sign up for a cannabis college.

Marijuana growers’ annual earnings can be anywhere between $50,000 to over $1 million, depending on the amount of weed that they grow and the state where they grow it. Generally, you can earn a decent amount of money growing marijuana in California, Arizona, Colorado, Oregon, Michigan, Maine, and Massachusetts.

Dispensary Owner

Owning a dispensary can be a very lucrative business when it’s done well. Those who have some business experience will handle the administrative side of owning a shop more easily. However, even if you don’t have any experience, you can learn it on the job and run a successful business. But exactly how much do dispensary owners make? Well, some dispensaries can make well over $1-2 million annually!

Cannabis Dispensary Manager

Dispensary managers are in charge of the daily functioning and activities of the dispensary. Most managers learn about the business on the inside by starting off as budtenders or cannabis trimmers. Their earnings can range from $60,000 to $150,000 per year.

Marijuana Edibles Chef

This is another very popular job position in the cannabis industry because it’s very versatile and edibles are steadily rising in popularity. Many people who are already chefs decide to enter the cannabis business, but people with no experience also sign up for classes to learn how to cook with cannabis. Marijuana chefs have annual earnings between $40,000 and $90,000, but it all depends on the company they work for.


The positions for budtenders get filled up quickly as it’s a very competitive field. Budtenders need to be very educated on the strains of cannabis and their effects, for both recreational and medical marijuana. They are responsible for helping medical marijuana patients to choose the right strain for them and educate them on the ways to use it. They earn between $32,000 and $42,000 a year.


The marijuana industry has been growing rapidly ever since marijuana was made legal for adult-use and decriminalized. Whether for medicinal or recreational use, the market for cannabis is expanding because of the increasing demand. Consequently, weed dispensaries are becoming as profitable as chain stores like Whole Foods.

Starting up a cannabis company in the US is more expensive due to the specific requirements for this business and the startup costs. In order for a dispensary to be successful, business owners need to cater to the needs of their consumers, have a good marketing plan, and take into account the ongoing costs and expenses, especially if they produce their own marijuana.

As this business is booming, there are many different jobs available for weed enthusiasts to try out and make a good living.

A passionate advocate for the benefits of cannabis. Fraser Horton, who has a background in botany and a strong love of nature, has spent years researching how cannabis affects the body and mind. He established Leaf Nation in 2020, where he has devoted himself to educating people about the legalisation of marijuana and its safe and responsible use. Fraser is committed to highlighting cannabis’ potential for improving wellness and working to dispel the stigma associated with its use.


The information presented on this page is provided as a public service to aid in education and is derived from sources believed to be reliable. Readers are responsible for making their own assessment of the topics discussed here. In no event shall Leaf Nation be held reliable for any injury, loss or damage that could happen if using or abusing drugs.