CBD Business Opportunities: How to Start and Manage a Successful CBD Business
By: Inclusive Pay
Tags: Merchant Account, Cbd, Business

Article Highlights

· CBD (cannabidiol) is a naturally occurring chemical compound that is derived from the Cannabis sativa (marijuana) plant.

· Unlike THC, the major active ingredient in Cannabid sativa, CBD is not psychoactive.

· CBD has been found to provide numerous health benefits, from stress and anxiety relief to pain relief.

· The substance is legal and is used in a variety of products, such as oils, edibles, and lotions.

· Because CBD is legal and offers a myriad of benefits, its popularity is soaring. It’s projected that the CBD industry will reach or exceed $20 billion in sales by the year 2024.

Though it may still be pretty new, CBD (short for cannibidiol) has become an extremely popular product in recent years. One of the more than 100 known compounds found in Cannabis sativa — a flower plant from the Cannabaceae family — CBD has been touted as a modern, all-natural “cure-all”. That’s because it has been found to offer a wide range of therapeutic and health benefits, which include pain relief, reduction in cancer-related, anxiety and depression relief, and even a possible acne treatment. Given the numerous benefits that it provides and the fact that it’s all-natural (and legal, thanks to the Farm Bill, which was passed in 2018), CBD has created quite a buzz.

Tinctures, lotions, edibles, suppositories (yes, suppositories), dog food; CBD oil is infused into an endless array of products, making it possible for the public to reap the benefits that the natural substance provides in virtually any way that suits their needs. The CBD market has become so vast that, according to BDS Analytics, an industry analyst, has predicted that by the year 2024, sales of products will soar to an unprecedented $20 billion in the United States alone.

Given the numerous benefits that CBD provides (more benefits continue to be discovered, too), the fact that it’s all-natural, and because it is used in so many products, entrepreneurs are realizing the gold mine that potentially awaits them by selling CBD. You can find products pretty much anywhere you look these days; online vendors, wellness retailers, head shops, smoke shops, and gas stations ; even pharmacies are selling it now, too.

While the CBD industry is growing at a rapid rate and sales projections are certainly promising, if you’re interested in starting your own business, you may be thinking about jumping on the CBD seller bandwagon, too. Before you jump in, though, it’s important to note that while there are many positives, the market does face some challenges; thanks largely in part to ever-changing laws. With that said, however, the opportunities for success are definitely there — if you do it right.

If you’re thinking about starting your own CBD business, read on for useful information that you can use to establish and run a flourishing venture.

What Exactly is CBD, Anyway?

Before we dive in and discuss tips for starting your own CBD business, we think it’s important to provide a more in-depth overview of this naturally occurring compound.

As mentioned, CBD (short for cannabidiol) is one of the more than 100 known cannabinoids, or chemical compounds, that occur naturally within the Cannabis sativa and hemp plants. Unlike its cousin, tetrahydrocannabinol (THC), one of the most active compounds in marijuana, CBD does not have a psychoactive effect. In other words, CBD does not create that “high” sensation that is so commonly associated with marijuana. Instead, cannabidiol has been found to and is believed to provide some health and therapeutic benefits. It should be noted, however, some benefits that CBD is said to provide have not yet been proven, though researchers continue to study the possible uses and benefits of the compound.

Typically, the production of CBD-infused products is a multi-step process. The first step, of course, involves cultivating and harvesting Cannabis plants. For instance, if you plan on procuring your own CBD, you could either purchase or grow your own industrial-grade hemp and then extract the CBD oil from the plants using one of many methods (CO2, olive oil, or solvent extraction, for example). If you prefer a simpler process, you could outsource the CBD extraction process to a company that specializes in extraction.

After the CBD has been extracted from the plants, you have two options:

1. Sell the oil as a concentrate

2. Infuse the oil into one or more of several products; tinctures, topicals (cream, lotion, balm, gel, etc.), edibles, capsules, or suppositories, for example

Cannabis CBD and Hemp CBD: What’s the Difference?

Cannabidiol can be derived from cannabis or hemp plants. While cannabis and hemp are the same species of plant and CBD can be derived from both, it is important to note that there is a distinct difference between the oils that come from each plant. That’s because cannabis contains more THC (the substance that is responsible for the psychoactive effect that marijuana is famous for) than hemp (which only contains about 0.3% or less). Therefore, cannabis creates that “high” sensation, while hemp does not. As such, there is a marked difference in the CBD oil that the plants contain.

Because of the far lower THC content, as per United States federal law, industrial hemp is legal to cultivate, harvest, and turn into CBD-infused products. Since cannabis contains more than 0.3% THC — and in many cases, much higher — it is still classified as a Schedule 1 drug, as per the US Controlled Substances Act, meaning that it cannot be legally sold or distributed via interstate commerce, regardless of the fact that more and more states are legalizing cannabis consumption.

To summarize, hemp-derived CBD-infused products are legal to sell, while cannabis-derived CBD-infused products are illegal to sell.

Full-Spectrum vs Isolate CBD: What’s the Difference?

If you have any experience with CBD products — whether for your own personal use or you’ve been researching for business purposes — it’s likely that you’ve noticed two distinct terms: Full-spectrum and isolate. What’s the difference between the two? Let’s take a look…

· Full-spectrum. Full-spectrum CBD refers to CBD oil that contains other cannabinoids and compounds that the plant the oil was extracted from contains, in addition to CBD. For example, full-spectrum CBD also contains terpenes, which provide the flavor, scent, and the effects that are associated with the plant.

· Isolate. CBD isolate is a concentrate, meaning that the oil contains CBD only; it is free of other compounds that the plant contains, including cannabinoids or terpenes.

It is often assume that CBD isolate is better, as it is a concentrate, and therefore it is purer than full-spectrum CBD; however, that thought is believed to be a misconception. Several research studies have suggested that full-spectrum CBD oil actually provides better and more noticeable effects. The reason? — Because full-spectrum CBD contains additional compounds that the plant the oil is derived from contains, and it is believed that those additional compounds (other cannabinoids and terpenes) better facilitate the effects that CBD provides. It is important to note, however, that this has not been confirmed and further research is being conducted.

Growth of the CBD Industry

As stated above, BDS Analytics, a leading industry analyst, has projected that by 2024, the CBD market in the United States will reach at least $20 billion in sales. In comparison to 2018, when CBD sales in the US were only $1.9 billion, that’s a projected growth rate of 49% annually; a substantial amount of growth.

This growth projection clearly indicates that the CBD and the products that are infused with it are becoming more accepted and increasingly more popular. Some of the most common reasons people are using CBD for include pain management, depression and anxiety relief, improved sleep, stress relief, and simply for relaxation. As studies regarding the efficacy and applications for CBD use continue and more is learned about this all-natural “cure-all”, and given the fact that hemp-based CBD-infused products are legal and can be sold interstate — and that there are so many products and it is so widely available — it’s pretty easy to see why the sales projections over the course of the next four years are so significant.

Changes to the CBD Market

As acceptance, use, and advancements in CBD products progress, changes in the market can be expected. According to experts, one of the most notable trends that will likely be experienced in the future is an increased level in potency.

It is expected that CBD-infused products will be more powerful than they currently are; especially full-spectrum products. Furthermore, as more research is done, it is believed that there will be more pharmaceutical-grade CBD products in the near future.

In 2018, the US Food and Drug Administration (FDA) approved a CBD-based oral solution, Epidiolex, for the treatment of seizures that are side-effects of two severe types of epilepsy in patients who are two years of age and older: Dravet and Lennox-Gastaut syndrome. This pharmaceutical-grade oral CBD solution is showing significant benefits for patients. As such, and given the fact that CBD oil has been found to be effective for pain management and studies have indicated that it could also support the circulatory system and heart health, and that it may be beneficial in the treatment of certain types of neurological disorders (though the evidence is not conclusive and furthers studies do need to be done), it is expected that CBD will have more of a presence in the pharmaceutical industry.

In addition to increased potency, it is expected that these products will be more readily available than they are now. Currently, there has been a surge in the amount of physical stores that sell the products, including head shops, smoke shops, and health-and-wellness stores. Currently, one of the most popular ways to purchase CBD products is via online retailers, and moving forward, it is expected that even more online stores will become available. At present time, about 60% of the CBD that is sold in the US is sold via e-commerce sites, and in the future, that percentage will surely grow.

Types of CBD-Infused Products

New and exciting products are being introduced into the CBD market on a constant basis. If you’re thinking about starting your own CBD-based venture, you’ll find that there is no shortage of products to choose from. Whether you’re setting up shop in a brick-and-mortar store or you’re launching an online shop, here’s a look at some of the different products that you might want to consider offering your clients:

· Edibles. Edibles are among the most popular CBD-infused products on the market, and for good reason; they’re easy to take, there are so many different options available, and most of them are pretty tasty, too. Some of the CBD-infused edibles that are currently available include:

o Cookies

o Brownies

o Gum and gummies

o Lollipops and other hard candies

o Chocolates

o Oral sprays (think breath sprays)

o Beverage enhancers

o Honey sticks

· Sublingual tinctures. CBD-infused tinctures are similar to an oral suspension. They’re in liquid form and they are typically packaged in bottles with a dropper attached to the top. To use a tincture, simple use the dropper to place a few drops of the oil underneath the tongue, where it will be absorbed. Tinctures are available in a variety of flavors, such as mint, citrus, mixed berry, cinnamon, and even natural hemp.

· Topicals. Topical products are another popular way to administer CBD oil. They include lotions, creams, balms, sprays, rollers, salves, and body oils. The CBD oil in topicals are absorbed through the skin.

· Vape concentrates. CBD oil can also be inhaled via vape concentrates, including waxes and oils, which can be used with electronic “cigarettes”.

· Pills and capsules. Lastly, CBD oil can be ingested in pill or capsule form. The oil is added to a dissolvable capsule or pill and as it is digested, the oil is released.

Launch Your Own CBD Business

With increasing popularity, so many uses, and so many products available, coupled with the significant sales projections, selling CBD could be a lucrative venture. By choosing the right platform, offering the right products, and effectively marketing your business, finding the right cbd merchant account, you could stand to see a great deal of success with your CBD business.