You have probably heard of CBD in the last few years. Either, a friend or coworker has mentioned it. Or you have seen it in some news to buy revolving around it. Have you ever asked yourself what is CBD? With the CBD market expected to grow to $20 billion by 2024, in the US, this new industry is affecting other providers from cosmetics, food and beverage, and pharmaceuticals. Some companies were already moving into the travel industry before the Covid-19.
What Is CBD?
Cannabidiol, also called CBD, is a non-psychoactive compound found in Cannabis Sativa and hemp. It is related to the better-known as tetrahydrocannabinol (THC), used for its intoxicating effect. CBD can be used for many therapeutic health benefits and is usually sold to help prevent minor pains, anxiety, sleep, and inflammation. CBD is created by harvesting the plants and extracting the oils that can then be sold or added to other products such as balms, edibles, and tinctures.
Understanding the Legal World of CBD
It may sound simple to start a CBD business, but some things should be considered. CBD businesses fall under FDA guidelines, and extra precautions are taken in how CBD items are marketed and sold. The 2018 Farm Bill did remove hemp as a controlled substance and allow for CBD sales, but the FDA guidelines for usage are still not set. The next legal consideration is on the source of CBD. CDB products must contain less than .03% of THC to be legally sold outside of dispensaries.
Create a Business Plan
Starting a business requires a license and a tax ID. A business plan will give your business a direction. CBD can be produced in many forms, and it can be sold anywhere. Targeting a niche market or product will help create focus and allow for growth and recognition. If you have a target market, you will then need to build out a model to attract customers.
However, if you are hoping to operate online only, this will be a great time to focus on your business website and online presence. Once that is done, you will need to work on selecting suppliers to work with. You may also be at the point where you are considering hiring an extra person to assist.
Business Are Team-Based
Unless you plan to do all of the work and build business and client relationships you will need to hire extra personnel. For retail and online businesses you will need customer representatives for sales. If you are growing hemp and extracting the compounds you will also need to consider workers with those skills. An often forgotten role with CBD companies is a financial expert to help with both agribusiness trends and market trends. A financial expert can also help with banking and business insurance needs.
A Bright Road Ahead
The CBD industry is growing at an explosive rate. With a good business plan, a good team, a target market, and some hard work you can get into this booming trend and create a brand.