The coronavirus pandemic has changed the whole world this year, with many having been made redundant, or worse, unemployed, and for those of us that still have jobs, we find ourselves working from home. This has left many people seeking new career opportunities as they still have rents and mortgages to pay, without an income. One new business sector that has grown exponentially recently is the CBD retail world.
CBD derives from the marijuana plant; however, it does not contain any of the psychedelic properties that the other main component THC provides such as deep water culture. CBD has been shown to have many health benefits, and therefore a whole new industry has grown up using this natural product. Many people are unsure of how to market it, or even what to do with it, so here we are going to take a look at how to get started in the CBD retail business.
Check the legal situation
The most important thing to do before embarking on a career in CBD is to check the legality of the product where you live because, in many states and countries, it is still completely illegal. However, due to the loosening of laws in Canada, the USA, and parts of Europe, it is now perfectly legal in certain areas. Make sure you contact your local government to find out what restrictions there are surrounding the product. You may be capped at using a certain percentage of CBD in your products, or it may be the case that certain items such as sweets or lozenges are off-limits. The last thing you want to do is fall foul of the law just when you are trying to create a business, so make sure you are well versed in all the local regulations.
Are you well-financed?
There is no point in starting a new business in any sector if you do not have the required level of funding, and this applies to the CBD world as much as any other. There is additional pressure because many of the mainstream banks will refuse to lend to businesses in the cannabis sector, and some will even refuse to offer you banking services full stop. Due to the nature of growing plants, there is a time lag between spending money and receiving an income, so it is really important to have a robust business model so that you are financially solvent throughout this period. Although the product operates in somewhat of a grey area in many states, it is still vital that you do your research and have a business plan that allows for the fact you are unlikely ever to receive loans from financial institutions.
Sourcing CBD
The next big question is, where will you get your base CBD oil from? Effectively you have two options; you can grow your own plants and extract the oil yourself, or you can use the wholesale CBD market. Growing your own plants is time-consuming and requires a lot of expertise, and in some states, your own license. Using the wholesale market, on the other hand, allows you to buy a consistent product when you want it, and at a price that the market has agreed. This will allow you to spend much more time on the things that matter i.e., creating and marketing your own product to the masses. As with any business, it is not worth the time and effort concentrating on the aspects that you have no experience in; it is much better to focus where your expertise lies.
Create a brand
There are so many different and new players in the CBD market that it is crucial that you have a strong brand so that you stand out from the crowd. Are you going to focus on one particular product such as oil, or will you branch out into edibles and vape friendly products? Finding your niche is key, as is coming up with a fun brand and a logo that matches. The packaging is also super important because the sort of people who you are likely to be marketing to will likely be trendy young millennials that are always on point, so you must pander to their needs if you want to come up with a successful brand.
What products will you make?
You have now arranged your sourcing, so now you need to decide what you are going to sell. The possibilities are endless, from natural oils that you can drop under your tongue, to sweets and lozenges that you can suck on. Some people prefer to take it in capsule form so that it is unobtrusive and kept under the radar. Others are still trying to give up smoking, so would rather mimic the effect by vaping, and some like the feeling of using a spray. Whatever you choose, make sure you do your market research so that you know who you will be trying to sell to, well before your product reaches the market.
Set up a marketplace
Once you have sorted out your products, you need to work out where you will sell your products. You basically have two options: you can open a traditional brick and mortar shop, or you can set up an online store. Both have their advantages and disadvantages. An online store allows you to reach the maximum number of people, and you do not have the overheads associated with a physical shop. However, having your own store allows you to give great customer service and also allows clients to try out your products before you buy them. You need to weigh up whether this extra expenditure is worth it for your business, and only you will be able to answer this question.
As we have discovered, it is not easy to get started in the CBD retail business as it is a relatively new field, and there are many restrictions and barriers to entry. Check the legal situation and make sure that you are well-financed as you will not be able to access traditional lenders. Create a brand that appeals to your target demographic and source your CBD through the wholesale market, leaving you with plenty of time to concentrate on selling and marketing your products.