In 2018, the Farm Bill made it legal to manufacture and sell CBD products derived from the hemp plant. Unlike the THC (tetrahydrocannabinol) contained in marijuana, hemp-based CBD does not lead to intoxication or psychedelic effects. If you want to join the thousands of entrepreneurs who are already taking advantage of the skyrocketing consumer interest in CBD products of all types, there are some important factors to keep in mind.
1. Understand CBD and the range of products.
In its legal form, cannabidiol (CBD) comes from industrially grown hemp plants that only contain negligible amounts of the THC that many people associate with cannabis. CBD products are available in several forms: edibles, oil, isolate, topicals, tinctures, and even vape juice. As you come up with your goals and business plan, it will be vital for you to decide which CBD products you intend to sell.
2. Fully grasp the benefits of CBD.
If your CBD business is to succeed, you must be able to communicate to your potential customers exactly why they should spend their money on your products. Proponents of CBD loudly praise the benefits it can bring, including relief of pain and anxiety, reducing the symptoms of depression, and even helping to overcome dependence on addictive substances.
It is, however, important to understand that you should never make claims about CBD products that are not substantiated by verifiable research. Doing so can cause your merchant account provider to suspend or entirely close down your account, and might be fatal to your business.
3.Nail down your business model.
There are numerous niches in the world of CBD products, and it is crucial that you determine how your business will be positioned. Will you be manufacturing your own unique CBD products, or do you plan to sell products made by others? Will you be running your business from a physical store, online, or both? How will you get the capital you need to get started and remain afloat during those difficult initial months?
4. Find the right payment processor.
This may come as a surprise, but payment processing for CBD businesses is considered “high-risk” by merchant account providers. This is true even though everything you sell is completely legal.
As a high-risk business, you can expect to undergo additional scrutiny when applying for the merchant account you will need when accepting customer payments. In addition, don’t be shocked if the per-transaction fees you pay are higher than you would see for a “standard” business type.
There is a saying that anything truly worth doing requires work and perseverance. CBD products are taking the country by storm, and all indications are that this trend will continue. As long as you dedicate care, time, research, and forethought to the preliminary tasks vital for getting your CBD business started, you have an excellent chance of being able to capitalize on these highly beneficial products.
