- Hard candy
- Gummies
- Chocolates
- Baked goods
Customer Focus
High Kite Dispensary will target recreational cannabis consumers in Denver, Colorado. The Company’s product offerings will cater to individuals ages 21 and over, from people new to cannabis to seasoned connoisseurs. High Kite Dispensary will employ knowledgeable budtenders to provide personalized customer service, providing each customer with information and helping them select the products that are right for them.
Management Team
High Kite Dispensary will be owned and operated by Jim Johnson and Michelle Smith. The duo has recruited Jan Jones, an experienced cannabis dispensary manager, to help run the day-to-day dispensary operations and supervise the budtenders.
Jim Johnson is a graduate of the University of Colorado with a Master’s degree in Business Administration. He has successfully brought two other startups to market as an active member of the executive team. Jim’s organizational skills and diligence have allowed him to establish a reputation as a driven CEO with the ability to spearhead favorable ROIs.
Michelle Smith is also a graduate of the University of Colorado with a Bachelor’s degree in Finance. She has spent the last ten years working in a financial management role for a high end retail shop, before coming on as High Kite’s CFO.
Jan Jones has been working in the cannabis industry in Colorado for the last three years. She started out as an entry level budtender and has gone on to roles with increasing responsibilities from head budtender to cannabis dispensary manager. Jan’s industry expertise is an essential asset for this new cannabis company.
Success Factors
High Kite Dispensary will be able to achieve success by offering the following competitive advantages:
- Friendly, knowledgeable, and highly qualified cannabis experts that are able to effectively educate customers, manage the products, and work together as a team to provide the best experience for shoppers.
- Extensive menu of products ensures there is something for every taste and every budget.
- As a locally owned and operated business, High Kite Dispensary sources its products from local cannabis growers and producers at a wholesale discount, thus allowing the company to achieve a healthy profit margin.
Financial Highlights
High Kite Dispensary is seeking $200,000 to launch its cannabis dispensary. The funding will be dedicated towards securing and remodeling the shop and purchasing the initial inventory. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and cannabis marketing costs. The breakout of the funding is below:
- Storefront build-out: $20,000
- Inventory and supplies: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
The following graph below outlines the pro forma financial projections for High Kite Dispensary.
Company Overview
Who is High Kite Dispensary?
High Kite Dispensary is a newly established recreational cannabis dispensary in Denver, Colorado. High Kite Dispensary will be the most reliable, affordable, and fun choice for cannabis consumers in the city. The dispensary will provide a comprehensive menu of locally sourced cannabis products to appeal to any palette. Their customer-focused approach includes personalized customer service from knowledgeable budtenders seven days per week.
High Kite Dispensary will be able to serve all types of customers, from those new to cannabis to long-time consumers. The team of professionals are highly qualified and experienced in all things cannabis, from growing and production to processing and sales. High Kite Dispensary answers all questions customers may have, while delivering the best customer service.
High Kite Dispensary History
High Kite is owned and operated by Jim Johnson, a serial entrepreneur who has an MBA from the University of Colorado and Michelle Smith, a business management professional who has a Bachelor’s degree in Finance from the University of Colorado. Jim has successfully built and sold two previous startups. Michelle’s tenure as CFO of a previous retail company has given her the skills and knowledge required to venture out on her own and start her own company. Jim has gained the trust and commitment of a network of entrepreneurs, who will help to bring his new company to the attention of industry leaders.
Since incorporation, High Kite Dispensary has achieved the following milestones:
- Registered High Kite Dispensary, LLC to transact business in the state of Colorado.
- Has a contract in place for the chosen dispensary location.
- Reached out to numerous contacts to get that word out to potential customers that there will soon be a new dispensary coming to the area soon.
- Began recruiting a staff of managers, bookkeepers, and budtenders to work at High Kite Dispensary.
High Kite Dispensary Products
The following will be the products High Kite Dispensary will provide:
- Edibles:
- Hard candy
- Gummies
- Chocolates
- Baked goods
Industry Analysis
The legal cannabis industry is experiencing significant growth and is expected to continue this pattern over the next several years as recreational cannabis is becoming more accepted by the general population. The Colorado cannabis industry is a $2.2B market. Cannabis is a major source of tax dollars for the state, bringing in an estimated $423M in 2021, so it is a favorable cannabis market to start a new dispensary. Furthermore, the cannabis industry in Colorado is a major contributor to the local job market, bolstering the economy. In 2019, multiple cannabis bills were signed into law that ensure Colorado cannabis dispensaries can remain competitive in the ever-evolving industry through increased innovation, diversity, and equity.
For industry operators, intellectual property assets such as brand names and product trademarks are becoming increasingly valuable. Additionally, over the past year, the cannabis industry experienced a significant increase in M&A transactions with large players acquiring small dispensaries. This M&A activity is expected to continue to grow in the coming years.
Customer Analysis
Demographic Profile of Target Market
High Kite Dispensary will target individuals ages 21 and over in Denver, Colorado. They will target people new to cannabis as well as those that are very familiar with it.
The precise demographics for Denver, Colorado are:
Total Percent Total population 1,680,988 100% Male 838,675 49.9% Female 842,313 50.1% 20 to 24 years 114,872 6.8% 25 to 34 years 273,588 16.3% 35 to 44 years 235,946 14.0% 45 to 54 years 210,256 12.5% 55 to 59 years 105,057 6.2% 60 to 64 years 87,484 5.2% 65 to 74 years 116,878 7.0% 75 to 84 years 52,524 3.1% Customer Segmentation
High Kite will primarily target the following customer profiles:
- Gen Z
- Millennials
- Gen X
- Boomers
- Silent Generation
Competitive Analysis
Direct and Indirect Competitors
High Kite Dispensary will face competition from other companies with similar business profiles. A description of each competitor company is below.
Rocky Mountain Cannabis (RMC)
Rocky Mountain Cannabis (RMC) provides a range of cannabis products including vapes, CBD, and edibles. Located in southeastern Denver, RMC is an established dispensary that advertises the lowest prices in the area. The dispensary is opening a second location next year to accommodate the communities in northern Denver. RMC products include 23 strains of flower, a large selection of CBD oil brands, and edibles such as gummies and chocolates.
Denver’s Best Dispensary
Denver’s Best Dispensary is located in central Denver and offers edibles, CBD oils, pre-rolls, and vapes. The dispensary also sells cannabis-infused baked goods through its on-site bakery. Denver’s Best is owned and operated by cannabis professionals who have extensive experience in growing, processing, and retail of recreational cannabis and CBD products.
Colorado Canna Flower (CCF)
Colorado Canna Flower (CCF) is located in eastern Denver, with multiple locations across Colorado including Golden, Boulder, and Aspen. CCF specializes in unique CBD oil blends and low-dose edibles. The dispensary is managed by former medical dispensary executives with extensive industry experience.
Competitive Advantage
High Kite Dispensary will be able to offer the following advantages over their competition:
- Friendly, knowledgeable, and highly qualified cannabis experts that are able to effectively educate customers, manage the products, and work together as a team to provide the best experience for shoppers.
- Extensive menu of products ensures there is something for every taste and every budget.
- As a locally owned and operated business, High Kite Dispensary sources its products from local cannabis growers and producers, bolstering the local economy.
Marketing Plan
Brand & Value Proposition
High Kite Dispensary will offer the unique value proposition to its clientele:
- Highly-qualified team of skilled employees that is able to provide personalized service and value-add information.
- Unbeatable pricing to its customers – High Kite Dispensary does not mark up its products at a large percentage. They will offer the most reasonable price for quality cannabis products in town.
Promotions Strategy
The promotions strategy for High Kite Dispensary is as follows:
Word of Mouth/Referrals
Jim Johnson has built up an extensive list of contacts over the years by providing exceptional service and expertise to his customers. Once Jim advised them he was about to open his own cannabis business, they volunteered to help spread the word of High Kite Dispensary.
Professional Associations and Networking
High Kite Dispensary will become a member of cannabis industry associations such as the Colorado Cannabis Association (CCA) and the National Cannabis Industry Association (NCIA). They will focus their networking efforts on expanding their customer base.
Print Advertising
High Kite Dispensary will invest in professionally designed print ads to display in programs or flyers at industry networking events.
Website/SEO Marketing
High Kite Dispensary will utilize their in-house marketing director that designed their print ads to also design their website. The website will be well organized, informative, and list all their products. The marketing director will also manage High Kite’s website presence with SEO marketing tactics so that anytime someone types in the Google or Bing search engine “Denver cannabis dispensary” or “CBD near me”, High Kite Dispensary will be listed at the top of the search results.
Pricing
The pricing of High Kite Dispensary will be moderate and on par with competitors so customers feel they receive value when purchasing their products.
Operations Plan
The following will be the operations plan for High Kite Dispensary.
- Jim Johnson will be the owner and CEO of the company. He will oversee all staff and manage business relations.
- Michelle Smith will be the co-owner and CFO of the company. She will oversee all accounting and bookkeeping for the company. Jim and Michelle have spent the last few months recruiting the following staff:
- Jan Jones – Dispensary Manager who will supervise the budtender staff and run the day-to-day operations of the business.
- Kim Martinez – Staff Accountant will report to Michelle and will provide all accounting, tax payments, and monthly financial reporting.
- Ben Martin – Marketing Manager who will provide all marketing for High Kite.
Milestones:
High Kite Dispensary will have the following milestones complete in the next six months.
6/1/2022 – Finalize contract to lease dispensary building
6/15/2022 – Finalize personnel and staff employment contracts for the High Kite management team
7/1/2022 – Finalize contracts with cannabis producers and key suppliers
7/15/2022 – Begin networking at industry events
7/22/2022 – Begin moving into High Kite Dispensary
9/1/2022 – High Kite Dispensary opens for business
Management Team
High Kite Dispensary will be owned and operated by Jim Johnson and Michelle Smith. The duo has recruited Jan Jones, an experienced dispensary manager, to help run the day-to-day dispensary operations and supervise the budtenders.
Jim Johnson is a graduate of the University of Colorado with a Master’s degree in Business Administration. He has successfully brought two other startups to market as an active member of the executive team. Jim’s organizational skills and diligence have allowed him to establish a reputation as a driven CEO with the ability to spearhead favorable outcomes.
Michelle Smith is also a graduate of the University of Colorado with a Bachelor’s degree in Finance. She has spent the last ten years working in a financial management role for a high end retail shop, before coming on as High Kite’s CFO.
Jan Jones has been working in the cannabis industry in Colorado for the last three years. She started out as an entry level budtender and has gone on to roles with increasing responsibilities from head budtender to general manager. Jan’s industry expertise is an essential asset for this new cannabis company.
Financial Plan
Key Revenue & Costs
The revenue drivers for High Kite Dispensary are the sales of cannabis products. High Kite has contracts in place with suppliers to purchase products at a wholesale price, which allows them to sell the products for a lower price point than competition for a higher profit margin.
The cost drivers will be the overhead costs required in order to staff a dispensary seven days per week. The expenses will be the payroll cost, rent, utilities, inventory and supplies, and marketing materials.
Funding Requirements and Use of Funds
High Kite Dispensary is seeking $200,000 to launch its cannabis dispensary. The funding will be dedicated towards security measures and remodeling the shop and purchasing the initial inventory. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs. The breakout of the funding is below:
- Storefront build-out: $20,000
- Inventory and supplies: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
Key Assumptions
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials.
- Average sales per month: $500,000
- Average profit margin: 21 percent
- Building lease per year: $100,000
Financial Projections
Income Statement
FY 1 FY 2 FY 3 FY 4 FY 5 Revenues Total Revenues $360,000 $793,728 $875,006 $964,606 $1,063,382 Expenses & Costs Cost of goods sold $64,800 $142,871 $157,501 $173,629 $191,409 Lease $50,000 $51,250 $52,531 $53,845 $55,191 Marketing $10,000 $8,000 $8,000 $8,000 $8,000 Salaries $157,015 $214,030 $235,968 $247,766 $260,155 Initial expenditure $10,000 $0 $0 $0 $0 Total Expenses & Costs $291,815 $416,151 $454,000 $483,240 $514,754 EBITDA $68,185 $377,577 $421,005 $481,366 $548,628 Depreciation $27,160 $27,160 $27,160 $27,160 $27,160 EBIT $41,025 $350,417 $393,845 $454,206 $521,468 Interest $23,462 $20,529 $17,596 $14,664 $11,731 PRETAX INCOME $17,563 $329,888 $376,249 $439,543 $509,737 Net Operating Loss $0 $0 $0 $0 $0 Use of Net Operating Loss $0 $0 $0 $0 $0 Taxable Income $17,563 $329,888 $376,249 $439,543 $509,737 Income Tax Expense $6,147 $115,461 $131,687 $153,840 $178,408 NET INCOME $11,416 $214,427 $244,562 $285,703 $331,329 Balance Sheet
FY 1 FY 2 FY 3 FY 4 FY 5 ASSETS Cash $154,257 $348,760 $573,195 $838,550 $1,149,286 Accounts receivable $0 $0 $0 $0 $0 Inventory $30,000 $33,072 $36,459 $40,192 $44,308 Total Current Assets $184,257 $381,832 $609,654 $878,742 $1,193,594 Fixed assets $180,950 $180,950 $180,950 $180,950 $180,950 Depreciation $27,160 $54,320 $81,480 $108,640 $135,800 Net fixed assets $153,790 $126,630 $99,470 $72,310 $45,150 TOTAL ASSETS $338,047 $508,462 $709,124 $951,052 $1,238,744 LIABILITIES & EQUITY Debt $315,831 $270,713 $225,594 $180,475 $135,356 Accounts payable $10,800 $11,906 $13,125 $14,469 $15,951 Total Liability $326,631 $282,618 $238,719 $194,944 $151,307 Share Capital $0 $0 $0 $0 $0 Retained earnings $11,416 $225,843 $470,405 $756,108 $1,087,437 Total Equity $11,416 $225,843 $470,405 $756,108 $1,087,437 TOTAL LIABILITIES & EQUITY $338,047 $508,462 $709,124 $951,052 $1,238,744 Cash Flow Statement
FY 1 FY 2 FY 3 FY 4 FY 5 CASH FLOW FROM OPERATIONS Net Income (Loss) $11,416 $214,427 $244,562 $285,703 $331,329 Change in working capital ($19,200) ($1,966) ($2,167) ($2,389) ($2,634) Depreciation $27,160 $27,160 $27,160 $27,160 $27,160 Net Cash Flow from Operations $19,376 $239,621 $269,554 $310,473 $355,855 CASH FLOW FROM INVESTMENTS Investment ($180,950) $0 $0 $0 $0 Net Cash Flow from Investments ($180,950) $0 $0 $0 $0 CASH FLOW FROM FINANCING Cash from equity $0 $0 $0 $0 $0 Cash from debt $315,831 ($45,119) ($45,119) ($45,119) ($45,119) Net Cash Flow from Financing $315,831 ($45,119) ($45,119) ($45,119) ($45,119) Net Cash Flow $154,257 $194,502 $224,436 $265,355 $310,736 Cash at Beginning of Period $0 $154,257 $348,760 $573,195 $838,550 Cash at End of Period $154,257 $348,760 $573,195 $838,550 $1,149,286 Dispensary Business Plan FAQs
What Is a Cannabis Dispensary Business Plan?
A dispensary business plan is a plan to start and/or grow your dispensary business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
What are the Main Types of Cannabis Dispensaries?
There are three main types of cannabis dispensaries:
- Recreational Cannabis Dispensary
- Medical Marijuana Dispensary
- Combination (Recreational & Medical Marijuana Dispensary)
How Do You Get Funding for Your Dispensary?
The main sources of funding for a cannabis business are personal savings and angel investors. Banks typically will not lend money to marijuana businesses due to federal laws. To help you convince an angel investor to invest in your dispensary, you need a well-written business plan.
What are the Steps To Start a Dispensary Business?
Starting a dispensary business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your business goals and get started faster.
- Write A Cannabis Business Plan - The first step in starting a business is to create a detailed business plan for your dispensary that outlines all aspects of the venture. This should include relevant market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
- Choose Your Legal Structure - It's important to select an appropriate legal entity for your dispensary business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your dispensary business is in compliance with local laws.
- Register Your Dispensary Business - Once you have chosen a legal structure, the next step is to register your dispensary business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
- Identify Financing Options - It’s likely that you’ll need some capital to start your dispensary business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
- Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
- Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
- Acquire Necessary Dispensary Equipment & Supplies - In order to start your dispensary business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
- Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your dispensary business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.
Learn more about how to start a successful dispensary business:
- How to Open a Dispensary Business
- How to Open a Dispensary Business
Where Can I Get a Dispensary Business Plan PDF?
You can download our free dispensary business plan template PDF here. This is a sample dispensary business plan template you can use in PDF format.
