Updated: Oct 4, 2022
The horizon for CBD business among other Cannabis and hemp-related companies in this industry has been expanding exponentially with each passing day owing to the surging adoption and growing interest among young and old alike. According to a BDS Analytics study, the USA's CBD market is anticipated to touchdown the US $20 Billion in terms of sales by the end of 2024. This is resulting in a 49 percent compound annual growth rate from US$1.9 Billion in 2018. If you plan to dive into this thriving market and tap a fortune in the CBD business, now is the right time.
Are you excited by the idea yet, or are you confused about where and how to start? Do not worry! Moe's group has got your back. Let us handhold you to the perfect success recipe for beginning a well-performing CBD business.
Introduction to CBD
CBD is one of the numerous cannabinoid compounds found in cannabis and hemp plants , which does not have any intoxicating effect upon consumption. CBD is somewhat attributed to multiple iatric benefits when consumed in the prescribed dosage. The right and ultimate ramifications and potential medical virtues of CBD are yet to be determined as research in this field is still on.
Classification of CBD
However, unidirectional and straightforward it may sound, CBD has various classifications that distinguish one type from the other. Let us take a close look at the different kinds of CBD below:
● Hemp CBD
It is obtained from cold-pressed hemp seeds and does not contain any psychoactive, unlike its cannabis counterpart. The THC content in hemp CBD is also significantly low, usually below 0.3 percent. Being non-psychoactive, it is approved legally by the federal government as a prescription drug and can be legally cultivated, harvested, and processed into various saleable products.
● Cannabis CBD
As the name suggests, Cannabis CBD is derived from Cannabis or more commonly known as Marijuana plants. It contains several psychoactive compounds, including THC in a considerably higher concentrate (5-35 percent), resulting in intoxicating effects and cause the kick that many CBD patrons look for. Owing to its psychoactive properties, Cannabis CBD is not completely legalized by the federal government. Given that Marijuana has been deemed as a Schedule I drug as per the Controlled Substances Act, it is illegal to be traded commercially on an interstate level.
● Full-spectrum CBD
Full-spectrum CBD contains all the cannabinoid compounds, including THC, CBC, CBN, CBG, and terpenes found in the source plants. Full-spectrum CBD has the most significant potential of entourage effects due to the terpenes and THC presence. It also contains fatty acids, proteins, essential vitamins, and other naturally occurring components that amplify the curative potentials like antiseizure, anti-inflammatory, antioxidant, and pain relief properties. However, at present, the concentration of THC is potentially low enough to avoid getting 'high', unlike other cannabis products.
● Broad-spectrum CBD
Like full-spectrum, this also contains additional cannabinoid compounds like CBN and traces of terpenes and cannabichromene, however, it lacks THC. Like its former counterpart, broad-spectrum CBD also has numerous medicinal properties such as anti-inflammatory, antiseizure, and anti-biotic and is packed with entourage effects. Given that it lacks THC, which is responsible for the 'kicks', people often prefer broad-spectrum over full-spectrum CBD products as a safer option.
● CBD isolate
As the name suggests, CBD variant is isolated from any additional cannabinoid compound and other elements and is the most refined and definite CBD type. It is used to treat definitive ailments and is most preferred by people who want to completely avoid psychoactive effects.
Analyzing the CBD market and scope
As mentioned already towards the beginning of the article, the CBD market is growing exponentially, owing to the surging popularity of CBD products. More and more people are showing keen interest in trying these products. Be it for palliative and remedial health effects or experiencing the trance-like 'highs' or 'kicks'.
A recent survey by High Yield Insights has revealed that over 40 percent of adults in the USA are keen on trying CBD. However, they prefer to know more about CBD and look for medical prescriptions or recommendations before trying CBD products. Ever since the federal government has legalized the use of hemp form of Cannabis, studies have shown that about 14 percent of the people personally use CBD-based products with a lower concentration of THC for treating several ailments, especially for treating pain, insomnia, anxiety, etc. These numbers are only expected to rise higher with the movements and demands to legalize Cannabis as a prescription drug growing stronger.
With newer dimensions of CBD utilization surfacing and the divergence of CBD products and benefits, the CBD industry's market and scope are sky-high, be it for manufacturers, sellers, or dispensaries.
How to start your own CBD business?
If the untapped CBD market and its potential for disruption intrigue your business acumen, you can hop on to the CBD brand wagon easily as the time is ripe. Wondering where to start and how to go about creating a successful CBD business, Moe's group is your destination. Here are some simple guidelines just for you on how you can build your CBD business and how
Moe's group can help you gain the market share and fame you are aiming for:
Be familiar with the laws of the Hemp Business Model
It is important to note that the government does allow the selling of Cannabis in the form of oil, capsules, and other states. However, the federal government allows the sale of those products whose THC content does not cross 0.3 percent. Here is what you need to know further about the legal regulations:
● Know the extraction process of CBD oil and different products available in the market
● Find out more on the legal laws in your city about CBD. After knowing about the legalities invest in the business
● Establish your business entity and get the necessary certificate and tax number
● Make sure your product catalog is transparent
Make a solid business plan
Getting into Cannabis is not an easy game. To win the lottery, you need a full-proof business plan. Dive deep into the market and find out what your customers are looking for.
Here are some tips on building a business strategy:
● Find out the variety of products that the target audience is looking for
● Find a specific niche for your market, such as healthcare, beauty care, pet care.
● Specific solutions that your customers are looking for
● Setting up a financial plan and finding out the emergency funds for your business.
Set your finances in place
One of the challenges you are likely to face is that most banks and financial institutions do not consider the cannabis business as a legal source of income. Thus, you may struggle in processing payment from your online store.
Creating a brand value
In a highly competitive market of CBD, standing out as a stellar product is paramount. Moe's group can help you with developing a business strategy which comprises of:
● A unique business name and product names
● Choosing business colors and creating a business logo, cards, packaging, etc
● Designing product packaging aligning with the brand colors
● Building an online presence and investing in paid ad campaigns
● Promoting brand both offline and online
● Setting a sales target and building an action plan to achieve it.
Find the right suppliers
You can use either source cannabis from farmers or process your oil or product from a trusted supplier. The following factors will help you choose your right supplier:
● Farming hemp requires enormous capital investment and requires you to abide by all the legal regulations. However, it serves as one of the best ways to ensure you sell the highest quality of Cannabis to your customers.
● Sourcing from other suppliers requires you to conduct laboratory analysis to ensure that all the molecular compounds such as THC, CBD are present in the CBD oil.
Set up your CBD store:
Many business models develop an online store to sell their products. So, the next step is hiring an expert web developer who can help you build your dream store. Here is how you can hire him:
● Find about the expertise in setting up an online business
● Try to find out if he has developed a CBD store beforehand. It helps in easy payment
gateway set up
● Check their previous work about UI and UX so that your online store is seamless
● Get eye-catching content from the developer or find a writer who can do so for you.
Launch your Business:
Once all these processes are set up, you can get ready to launch your business by making an official announcement in the market. You can do this by the following:
● Collaborate with sponsors or influencers in the market to spread the message about your product launch
● Start running a campaign and invite your audience to take part in the same to spread the message effectively.
Although the process may appear overwhelming for you, don't lose focus on launching the business. Moe's group can be beneficial right from stage 1 to launch as they are experts in branding CBD business. CBD Claims one of the most significant ways to not perform in the market is by giving false claims in the market. It is strictly recommended that you not sell your product through medical claims such as CBD cures Alzheimer's, Arthritis, Parkinson's, or anything else. Until these studies are backed up by research and clinical studies, Moe's group recommends not making any false medical claims.
In 2019, the Federal Trade Commission sent a warning notice to all the hemp businesses about their false medical claims.
As a business owner, you must understand false medical claims are illegal and could put consumers at risk. As business owners, we are here to solve customers' problems and not aggravate or add a new issue in their life.
With a pure intention of solving customer problems, develop your business strategy, and see how the business flourishes in the market.
Now, if you are wondering how do you show features or benefits to your customers, you need to find out:
● Customers pain
● Competitive edge
● Features of your product
● Customers need and want
Here are some ideas to market your brand
● Talk about the quality of your brand
● Mention about incorporating benefits of CBD into daily routine such it induces relaxes
● Different ways of consuming CBD
● Educate about the safety of the product
Moe's group is at your service!
Irrespective of what you decide your business model - as manufacturer or supplier, Moe's group can help with product formulation, packaging, and labeling of the brand.