Manufacturer (Type 6 non-volatile through Type 7 volatile)

Decide volatile vs. non-volatile + product types

Type 6 (non-volatile) is significantly easier and cheaper. Type 7 (volatile, e.g., BHO/PHO extraction) requires fire-safety engineering, certified equipment, and meaningfully more regulation. Decide your product line: edibles, tinctures, topicals, vapes, concentrates, infused pre-rolls, packaging-only. Many manufacturers start Type 6 and add Type 7 endorsement later.

Local zoning + business license

Manufacturing is usually allowed in industrial zones. Cities still require a Conditional Use Permit and business license, but unlike retail it's not usually capped. The bigger issue is finding a building with the right zoning, ventilation, fire-suppression capacity, and (for Type 7) explosion-proof construction.

Secure manufacturing premises

Industrial-zoned commercial property with: adequate electrical capacity, food-grade prep areas if making edibles, climate control, secure storage, OSHA-compliant workspaces, fire-suppression. Type 7 (volatile): explosion-proof rooms, certified ventilation, C1D1 electrical, dedicated fire-suppression. Setbacks apply: 600 ft from schools/daycares.

• ⚠Type 7 buildout is often the largest hidden cost, easy to under-budget by 2-3x.

Form your business entity

Form a California LLC or corporation through the California Secretary of State. Get a federal EIN from the IRS. Set up cannabis-friendly business banking. Most mainstream banks won't touch you. North Bay Credit Union, Safe Harbor, and a handful of state-specific cannabis-friendly banks are the realistic options.

• ⚠Federal banks generally won't bank cannabis businesses regardless of state legality.
• ⚠California requires the annual $800 franchise tax even in your first year.

Live Scan fingerprints + background checks

Every owner and anyone with a financial interest of 20%+ must complete California DOJ and FBI background checks via Live Scan. Done at any Live Scan location (often UPS Stores, sheriff's offices). Criminal history doesn't automatically disqualify: non-violent cannabis convictions are explicitly protected.

• ⚠Convictions involving violence, fraud, or trafficking of non-cannabis drugs can disqualify.
• ⚠Every owner needs their own scan; budget time for multiple sessions if scattered.

Register for METRC (track-and-trace)

California uses METRC for mandatory seed-to-sale tracking. You'll register for an account during the state licensing process, but get familiar with it now. Every gram of cannabis you touch must be tagged and tracked in METRC, with reconciliation reports filed regularly.

Build out and write SOPs

Detailed standard operating procedures for: extraction method (with safety procedures for Type 7), production batch records, sanitation, employee training, waste disposal, packaging, labeling, lab testing chain of custody, recall procedures. SOPs are the single most-reviewed document in your application.

• ⚠Vague SOPs are the #1 reason manufacturer applications stall. Be specific: 'inspect every 30 minutes' not 'inspect regularly'.

Set up lab testing relationships

All cannabis products must be tested by a licensed Type 8 testing lab before distribution. Establish a relationship with at least one lab early: pricing, turnaround times, and quality vary. Common labs: SC Labs, Steep Hill, Anresco, Sequoia.

State application via DCC

File through the DCC portal. Required: premises diagram, SOPs, security plan, insurance, financial information, Live Scan results. Submit for Type 6, 7, N, or P with M/A designation. DCC reviews; expect 10-16 weeks for initial review with potential follow-up requests.

DCC physical inspection

California Department of Cannabis Control inspects your premises before issuing a license. Inspectors check security camera placement and footage retention, vault and storage compliance, premises diagram accuracy, METRC integration, and operational SOPs in action.

• ⚠Inspectors arrive with a checklist; have your SOPs printed, vault stocked correctly, and cameras recording with 90-day retention.
• ⚠Failure means correcting deficiencies and rescheduling, which easily adds 30+ days.

License issued: begin operating

Once DCC issues your license (provisional then annual), you can legally operate. The first 12 months are usually a provisional license; convert to annual by submitting environmental and CEQA documentation. Renewal is annual.

• ⚠Provisional licenses have an end date. California has been phasing them out and pushing all operators to annual.
• ⚠First sale triggers state cannabis excise tax (15%) collection responsibility.