As the CBD industry in the United States continues to grow at lightning speed, more and more people are looking to carve out their own piece of the pie. Even though in recent years, we have witnessed a mushrooming of newly established private businesses, the CBD market still has plenty of space for passionate enthusiasts who are plotting to get in the game.
However, to stand out from the crowd and set your business up for success, you need specific knowledge and a bit of research to differentiate your brand with a top-quality product that will ensure a decent presence in the market, and as a result, high performances and revenues. Here are tried and true expert tips for planning a profitable CBD business.
1. What Is CBD?
Short for Cannabidiol, CBD is a chemical inherited from the Cannabis Sativa plant. One of more than 100 cannabinoids, it is a non-psychoactive component that makes up to 40% of the plant. By the way, the most famous cannabinoid is undoubtedly THC (Tetrahydrocannabinol), the one that can get you high.
Even though Cannabinoid ratios and content may vary greatly depending on plant strain and species, most CBD within the United States is derived from the hemp plant, which is low enough in THC. As such, it can be grown and sold legally similar to any other agricultural crop. In the 2018 Farm Bill, industrial hemp is defined as the one that contains less than 0.3% THC.
Although almost entirely free from THC, hemp is rich in other cannabinoids that provide a wide range of health and fitness benefits. Interestingly, an ever-increasing demand for CBD products has boosted the cultivation of unique hemp strains intended to produce high-quality CBD oil.
2. Where To Start? Set Your Goals!
To set up a successful business, it is essential to know the answers to some simple questions. Why have you decided to start it? What are your goals? Is it going to be more like a hobby, at least at the beginning, or are you intended to create a whale and later sell it for a staggering sum? There are a plethora of different scenarios; each of them is unique and requires a different approach.
As soon as you answer these questions, you can safely set up your goals and develop a sustainable strategy to reach them. Here you will also have to deal with the financial side of the story, trying to provide enough fuel to get off to a flying start. Do not forget that the right priorities are the key to success. Therefore do your best to focus on the stuff that really matters.
3. Define Your Marketing Strategy
Nowadays, it is simply not enough to offer high-quality products at a reasonable price – if you do not market your business properly, it will remain invisible for your potential clientele. That is why make sure you have the right online and offline marketing strategy to reach your target audience and get more sales.
By the way, speaking of the target group, you can hardly succeed as a one-size-fits-all company, hence set aside enough time to do some research and figure out who you are selling to. Chances are, you will be surprised how broad your potential demographic could be, but still, make every effort to learn their tastes and preferences to cater directly to their needs.
4. Apply For Your CBD Merchant Account
This can be a pretty challenging task. Hence, start thinking of this step well in advance. Do not expect that you can just pay a visit to the nearest bank and open a merchant account which does CBD. Due to the fluctuating regulatory landscape, getting access to reliable payment solutions can be a bit complicated and time-consuming.
Do your due diligence to find a suitable option to serve you in the long run as there is nothing worse than switching banks and disrupting operations. Fortunately, there are a number of trusted banks that do not hesitate to deal with CBD businesses, just make sure you apply for a merchant account on time as the entire process may take up to six weeks.
5. Select Your CBD Partner
Naturally, you can opt for creating your own brand but, truth to be said, as a newcomer in the industry, you have far better chances to succeed if you decide to team up with an existing reputable brand. Joining forces with a well-established wholesale partner comes with plenty of benefits, including significantly lower risks and upfront costs. Experts from Ganjapreneur explain that there are several major things to consider when selecting your future partner. The really good product should be THC- and contaminants- free, tested for quality by an independent lab, and organically grown. Therefore do not settle for less – now you know exactly what to look for in your CBD partner.
6. Learn To Recognize Your Future Opportunities
The CBD industry is one of the fastest-growing and constantly evolving out there, which means new products are introduced all the time. Even though the existing offering is already pretty diverse, there is plenty of room to show your creativity and gain a competitive edge.
While CBD products seem to be all around us offered by beauty companies, coffee shops, and other places we usually visit, people who are well-versed in the subject believe, more ways to use the benefits of CBD are yet to come. Anyway, the most popular products right now are edibles, sublingual tinctures, vape concentrates, and various topicals.
Edibles are considered the most promising group in terms of further development due to the endless opportunities it brings. The palette of options is amazing: baked goods, all sorts of candies, and other foods. In their turn, CBD gels, creams, and sprays make another up-and-coming vertical that leaves enough space for new ideas and products.
Just as it’s the case with any other business, it is very important to stand out from the crowd from day one. A winning combination of due diligence and creativity will surely set your enterprise up for success in the CBD industry. The best time to start? Right now!