Starting a Cannabis Business in Alaska
If you’re thinking about starting a cannabis business in Alaska, you’re probably wondering what steps are involved. Get your new venture off the ground with this guide. We’ll walk through legal requirements, business planning, security, and more.
A Brief History of Cannabis Legalization in Alaska
Alaska might be the “Last Frontier,” but it was one of the first states to enter the frontier of legalized cannabis use. But it hasn’t been all smooth sailing.
In 1975, Alaska decriminalized cannabis, making it the second state to do so. Shortly after, a unique court ruling determined that an adult’s right to privacy included owning and using a small amount of marijuana at home. Then, in 1990, possession was re-criminalized. Medical use got the green light in 1998. After two failed votes in 2000 and 2004, Alaska finally legalized recreational cannabis use in 2014.
Now, adults over the age of 21 can possess up to one ounce of cannabis and up to six plants. Usage is legal in private spaces and some stores with onsite consumption permits. The bill that legalized possession also legalized retail sales at licensed dispensaries. The first Alaskan dispensary opened in October 2016, and many have since followed suit.
The Cannabis Market in Alaska
Before you open a dispensary (or even get too deep into the consideration phase), it’s important to know how much potential your business will have. How large is Alaska’s cannabis market?
Legal cannabis sales have grown pretty consistently since that first dispensary opened in 2016. Researchers estimate that the market should exceed $130 million in sales this year. That’s impressive for one of the least populous states in the country, with just over 736,000 residents as of the 2020 census.
A big contributor to this growth is tourism. The first few cannabis-friendly states have enjoyed a surge of interested visitors from states without successful legalization efforts. Some Alaskan retailers estimate that up to 20% of their cannabis sales are to tourists.
This reliance on tourism hurt the industry slightly during COVID-related travel restrictions, but retailers are still going strong. After all, around 19% of Alaskan adults are current cannabis users.
With a large and growing cannabis market in sight, it’s tempting to claim a slice of it for yourself. So here’s how to go about starting a cannabis business in Alaska.
How to Start a Cannabis Business in Alaska
The exact process of starting a cannabis business in Alaska can vary, but there are several common steps for businesses directly involved with cannabis plants or products.
- Choose a Business Type: Retail isn’t your only option. You could also grow plants, manufacture cannabis products, provide quality testing, … you name it.
- Find a Location: Zoning and legal restrictions will play a role as you scope out a spot for your store, lab, or facility.
- Create a Plan: Most basic business plans include information about the company structure, business model, financing, and marketing. You can always dive deeper later. Talking to the Alaska Small Business Development Center is a good place to start.
- Take Legal Steps: Look to the state’s Alcohol & Marijuana Control Office for guidance. Before you’re in too deep, know that some municipalities prohibit cannabis-related establishments. Alaska offers six marijuana licenses depending on your type of business, each with a distinct multi-step process. The Alcohol & Marijuana Control Board publishes a list of steps you’ll need to follow after getting your license. You must also register to pay taxes. Consider engaging an attorney to ensure that your business is legally compliant.
- Get Financial Services: Because of the federal-level ban on cannabis, working with financial institutions comes with complications. Rather than pursuing major FDIC banks for financing, start with smaller local banks or credit unions, like the approved lenders on this list from the state government. Be aware that anyone with a direct financial interest in your business must be an Alaska resident. Another option is to find a specialized lender like FundCanna. Many (but not all) of the state’s approved lenders also offer business banking services.
- Other Considerations: As your business grows, you’ll discover that there are endless things to think about, such as staffing, growth, and long-term strategy.
Starting a cannabis business in Alaska isn’t easy. But do your homework, and you’ll be on the right path. For more details, see How to Start a Cannabis Business.
Alaska Cannabis Security Requirements
Properties with cannabis products onsite are at a huge risk for theft and other crimes. Security measures are one way to protect your livelihood. And what’s more, certain security measures are required by state regulations.
- Identification badges for all employees
- Exterior lighting
- An alarm system on all exterior doors and windows
- Business security cameras that store footage for at least 40 days and allow for continuous video monitoring
- Documented security policies
- Commercial-grade locks on exterior doors
You must also report any criminal incidents within 24 hours. (That’s a good idea anyway.)
There are, of course, more nuances to these requirements, but you get the basic idea. It’s smart to take cannabis security seriously. And because it’s so important, you might want to invest in extra security measures beyond what’s required. Preventing crime is much, much more pleasant than recovering from it.
Secure Your Alaska Cannabis Business with Deep Sentinel
Now that you know how to start a cannabis business in Alaska, it’s time to get started. There are a lot of steps and a lot of things to worry about. But one thing you shouldn’t have to worry about is security.
Deep Sentinel offers cannabis live security camera monitoring for businesses across the United States. The advanced surveillance system fulfills state regulations and then goes above and beyond with AI threat detection and live intervention. If there’s someone near your property after hours, a live security guard will step in and contact the authorities if necessary. No other provider can match this level of protection.
Give your new cannabis venture the ultimate protection with a Deep Sentinel system.