Cannabis Business in Florida

Medical marijuana has been legal in Florida since 2016, contributing to significant economic growth. Here are some key figures related to Florida's cannabis market:

• In 2018, medical cannabis sales were valued at $626 million.
• Projections indicated sales would exceed $1.6 billion by 2022.
• The Marijuana Business Daily estimated medical cannabis sales between:
  • $225 million and $300 million in 2018.
  • $950 million and $1.2 billion by 2021 (excluding edibles).
• If recreational marijuana had been legalized in 2020, it could have added $190 million annually in sales tax and tourism revenue, based on Florida's standard sales tax rates.
• Projections for 2025 estimate marijuana sales in Florida to range from $1.5 billion to $2.5 billion.

Cannabis-Touching Businesses in Florida

The Office of Medical Marijuana Use (OMMU) specifies that only licensed Medical Marijuana Treatment Centers (MMTCs) are authorized to provide medical marijuana and low-THC cannabis to approved patients and their caregivers in Florida. These centers are vertically integrated, meaning they manage all stages of production and distribution. Before they are permitted to dispense cannabis products, MMTCs must secure approval in the following three stages:

1. Cultivation
2. Processing
3. Dispensing

Ancillary Cannabis Businesses in Florida

In Florida, the cannabis industry relies heavily on ancillary businesses to support its operations. These companies provide essential services to ensure cannabis businesses remain compliant, efficient, and secure. Here are a few key sectors that offer critical support:

• Banking:

  Due to federal restrictions, cannabis businesses face significant challenges accessing traditional banking services. Specialized financial institutions and payment processors work with the cannabis industry to provide banking, loan, and payment solutions, helping businesses manage funds without relying on cash.

• Legal Services:

  Cannabis businesses in Florida must navigate a complex legal environment, making legal services essential. Firms that specialize in cannabis law assist with compliance, licensing, contracts, and staying up to date with changing regulations. These legal experts help businesses avoid costly legal issues.

• Accounting:

  Cannabis companies are subject to IRS Section 280E, which limits tax deductions and complicates financial management. Specialized accounting services ensure businesses maintain proper records, stay compliant with tax laws, and develop financial strategies that maximize efficiency within these constraints.

• Insurance:

  Insurance is critical for protecting cannabis businesses from a variety of risks, including property damage, product liability, and worker injuries. Cannabis-specific insurers offer tailored policies to meet the unique needs of the industry, ensuring adequate coverage across operations.

• Security:

  Given the high-value products and cash transactions involved, cannabis businesses require robust security solutions. Companies providing alarm systems, video surveillance, and access control systems help protect businesses from theft, ensuring compliance with state-mandated security regulations.

Other types of ancillary businesses are:

• Software and technology providers
• Packaging and labeling companies
• Payment providers
• Testing and quality assurance labs
• Marketing and branding agencies