The cannabis industry is in a period of rapid growth. Currently, cannabis products are legal for medical use in 39 states and for recreational use in 24, with more states poised to follow suit. As the market expands, so too does the industry’s physical footprint: almost 15,000 dispensaries exist in the US today, a number that will undoubtedly grow as new legal markets open. New dispensaries, however, face a challenge that their traditional retail counterparts do not: an elevated risk of theft.
This vulnerability is a result of the unique legal and regulatory influences on the cannabis industry. Fortunately, many of the same best practices that help prevent theft for other retail businesses also benefit dispensaries. Explore these and more cannabis-specific considerations in greater detail below.
Conflicting laws expose dispensaries to risk
In some ways, cannabis dispensaries are no different from other retail businesses with high-value products. Jewelry and electronics stores, for example, are also appealing targets for theft thanks to a large inventory of expensive and portable items. And with scarce national data, it is a challenge to completely untangle the rate of dispensary theft from retail theft rates as a whole.
There is no question, however, that dispensaries face an increased risk of theft along other axes. Despite spreading legalization at the state level, federal prohibition puts cannabis businesses in a degree of legal limbo. This can give the impression that owners are less likely to report or prosecute crime. Moreover, federal laws can make it hard for dispensaries to open bank accounts and can restrict their ability to process electronic payments. As a result, dispensaries deal primarily in cash and must keep large amounts on hand.
Learn more: Surviving the Cannabis Industry: Challenges for Dispensaries in 2025 and Beyond
Dispensary theft goes beyond smash-and-grab burglary
Broken windows make a dramatic visual impression, and armed robberies are a risk to personal safety as well as inventory. Dispensaries, however, are just as vulnerable to more mundane—and more common—forms of retail theft, including:
- Employee theft
- Shoplifting
- Cybercrime
The vast majority of dispensary employees are not engaging in theft. But if employees do steal, their increased access can result in disproportionate losses. They may simply pocket cash, offer unauthorized discounts to associates, or, in extreme cases, even facilitate a burglary. Employees and customers alike may also shoplift cannabis products directly off the shelves or from the stockroom.
The cash nature of cannabis-related businesses also increases the threat of armed robberies. Cash is regularly delivered to and from dispensaries in large quantities, and many customers carry it. Bad actors, therefore, have no trouble finding targets in and around dispensaries.
Finally, like most contemporary businesses, dispensaries are at risk of cyberattacks. Modern business strategies thrive on customer information, much of which can be sensitive. With it, retailers can generate recommendations, personalize offers, and build loyal customer relationships. This information, however, is equally valuable to cybercriminals, and a data breach can incur more than short-term costs. Breaches damage a business’s reputation, and the negative effects can linger.
Preventing theft relies on process as well as technology
The current landscape for cannabis businesses will never be risk-free. However, a robust combination of security technologies and best practices can help minimize the threat to dispensaries.
Technologies
Security tools today, both hardware and software, are stronger and more thorough than ever. Incorporating both can dramatically reduce opportunities for theft. In physical spaces, access control is key. Door locks, gates, and hardened windows prevent intrusion, while safes restrict access to cash and valuable products.
Visibility is also essential. Security cameras at doors, in storage spaces, and on the shop floor keep managers aware of the movements of people and products. With monitored camera feeds, security personnel can even respond to attempted theft in real time.
Meanwhile, healthy information architecture and modern cybersecurity platforms guard against digital intrusion. Proper network security and strong, multifactor authentication keep threat actors from gaining easy access. In addition, a cybersecurity service can filter malicious emails and files, monitor the network for suspicious activity, and perform regular vulnerability assessments.
Processes
Even the strongest lock fails to keep anyone out if left open. Ultimately, security measures are only as strong as the behavior of those who use them. Therefore, comprehensive security practices and thorough employee training are as essential as technology for keeping dispensaries safe.
Because employees have privileged access, security begins with careful hiring. Background checks and thorough screenings help build a trusted workforce. In addition, dispensaries should develop security-oriented procedures aimed at deterring and identifying theft, such as:
- Routine inventories – Regularly checking stock ensures quick attention to missing items.
- Robust training – Pre-established, well-rehearsed procedures minimize risk in vulnerable moments like receiving a delivery or closing for the day.
- Incident response plans – Similarly, thoughtful and rehearsed steps can help staff address attempted theft in the moment or summon appropriate assistance.
Another key option for dispensaries is to hire private security services. Expert professionals can assist with designing security systems and provide dedicated attention to vulnerable locations. Moreover, the presence of visible guards can act as a deterrent in and of itself. An obvious security presence raises the risk and the friction for potential thieves, forestalling opportunistic attempts.
Also read: Employment Practices Liability Insurance (EPLI) for Dispensaries
Theft happens, but the right insurance mitigates risk
The landscape for cannabis businesses is in flux. Regulations are changing rapidly, generating shifts in downstream risks and opportunities. To operate confidently, stay compliant, and protect their assets should the worst happen, dispensary operators need a partner with deep knowledge of the cannabis industry.
McGowan Wholesale offers a broad range of coverages for every aspect of dispensary operation and related businesses. Backed by McGowan’s expertise, dispensaries can focus on growing their business and providing exceptional service to their customers. Get in touch today to learn more.
