What To Consider Before Starting A CBD Business
Firstly, what is a CBD business?
CBD stands for cannabidiol, which is the second most common ingredient in the cannabis plant. There are some studies that suggest this ingredient can be helpful in providing solutions to a range of common problems – like chronic pain, sleep disorders, stress, etc. Therefore, a CBD business relates to companies that manufacture or sell CBD products.
It’s starting to become a massive industry, which is why we’re creating this article. There’s every chance this is a business idea you’re considering. But, before you start this journey, here are some key things to consider:
Familiarize yourself with the laws
What are the laws relating to CBD in your location? For the most part, it will be legal to start a company like this. However, there will also be a lot of regulations for you to know about. There are also licensing concerns and a variety of other legal things that need considering. So, spend some time working with legal aid to get to know all of these laws and regulations. This will ensure you set your business up legitimately, and without breaking any rules by accident.
To sell, or to grow?
Perhaps the biggest consideration revolves around your business plan. Are you going to be a CBD dispensary? In essence, this means you obtain CBD products that already exist, and sell them to the market. It’s not too dissimilar from any other eCommerce business.
Or, are you going to be a grower? This means you grow your own cannabis and use it to make CBD products. There are some pros and cons to this business model!
In the pro section, you get to create your own products and make them unique. You also have faith that your products use reliable ingredients – because you’ve grown the plants themselves. There’s also no need to worry about branding issues – what if one of the brands you sell goes through a bad period and has to close down? It will mean you sell fewer products, making less money.
In the cons section, you require additional investment for this idea. Firstly, you need to get your hands on all the products and tools to grow your own cannabis. This means working with suppliers – and the best approach is to go as local as you can. Some suppliers for cannabis growing equipment may say we have 5 locations to serve you, while others will say they only have 1. In this situation, it might be better to opt for the supplier with multiple locations. Why? Because they’re likely to have one closer to you – and you also have other locations in case you choose to expand later on. Either way, it is slightly harder and more expensive to grow and sell your own CBD products – yet arguably more profitable.
Overall, these are your two main concerns when starting a CBD business. Begin by understanding the laws and regulations. Then, decide which approach you want to go down. Will you do everything yourself, or do you prefer to simply source existing products and sell them?
Categories: Outside Contributors