Starting a CBD business: 7 steps for an ultimate brand

Starting a CBD business taps into a growing trend fueled by the increasing awareness of the health benefits attributed to cannabidiol (CBD). As the demand for CBD products continues to grow, the opportunity for business owners in the CBD industry becomes even more massive. However, starting a CBD business is not without its complications, especially given the complex and constantly changing legal landscape that surrounds the CBD industry.

If you’re thinking of starting your own CBD business, it’s crucial to fully understand the regulatory environment. This means keeping abreast of both local and international laws that control the sale of CBD products. Equally important is the need to identify reliable suppliers who comply with quality and safety standards.

What is CBD? (CBD basics)

Understanding the basics of CBD is essential for anyone interested in starting a CBD business. CBD, short for cannabidiol, is a non-psychoactive compound derived from the hemp plant, scientifically known as Cannabis sativa. Unlike THC (tetrahydrocannabinol), another compound found in cannabis, CBD does not induce a “high,” making it an attractive option for those seeking potential therapeutic benefits without the psychoactive effects.

CBD has garnered attention in the medical community for its potential to alleviate symptoms associated with various serious health conditions, including certain types of cancer, epilepsy, anxiety, and insomnia. This has led to an increasing acceptance of CBD use in many countries worldwide, including Europe.

Different types of CBD

In the growing CBD industry, understanding the different types of CBD oil available is crucial for any individual planning to start a CBD business (brand).

Full-spectrum CBD oil is derived using extraction methods that preserve various cannabinoids (including trace amounts of THC) from the hemp plant, also terpenes, which contribute to the plant’s aroma, flavor, and therapeutic effects. This type of CBD is valued for its “entourage effect”.

Broad-spectrum CBD offers a middle ground, containing a variety of cannabinoids and terpenes but typically devoid of THC.

CBD isolate, on the other hand, is the purest form of CBD, containing no other cannabinoids or terpenes. However, CBD isolate is considered to be the least effective.

How is CBD made

If you’re thinking about starting a CBD business, you must know that in the CBD industry, the extraction process is crucial in defining the quality of the final CBD product. The extraction process involves isolating CBD from the hemp plant, specifically separating it from THC, the psychoactive component, which is crucial for compliance with legal standards.

Post-extraction, CBD oil undergoes a refinement process to enhance its purity and quality. One common method is winterisation, which removes undesirable substances such as waxes, fats, and chlorophyll, thereby refining the oil into a cleaner, more consumable product. Another advanced technique is distillation, which involves heating the oil to vaporize compounds selectively, further purifying the CBD.

Reasons to start your own CBD business (brand)

CBD products are becoming increasingly popular across Europe, with many countries easing restrictions on its use. This shift has opened a significant window of opportunity for business representatives looking to enter the CBD industry. The saying “strike while the iron is hot” properly describes the current market dynamics for CBD products.

Starting a CBD business now could place you at the front line of this fastly evolving market. The CBD industry’s rapid expansion signifies that now is an opportune time to launch. For those considering starting a CBD business, the current landscape offers a promising chance to establish a strong position and thrive in an expanding market.

Different types of CBD business models

When starting a CBD business, it’s essential to understand the various business models available to determine which aligns best with your goals and resources. One popular model is the ecommerce CBD store, where you sell CBD products directly to consumers through an online platform. This model allows you to reach a broad audience without the overhead costs of a physical location.

Alternatively, physical CBD stores involve selling CBD products through a brick-and-mortar shop. This model enables personal customer interactions and the ability to build a loyal customer base.

The CBD distribution model focuses on supplying CBD products to other retailers. As a distributor, you will handle bulk sales, requiring you to build strong relationships with retail partners.

Start your CBD business by following these steps

If launching a CBD business is your aspiration, there are several crucial steps you must undertake to ensure everything is organized and complies with legal standards. Establishing a CBD business goes beyond simple registration – it involves a precise approach to set up and operate within the legal frameworks that govern the CBD industry.

At Hempo Solutions we offer professional consulting services designed to help entrepreneurs effectively enter and navigate the CBD market. With a deep understanding of the complexities and legalities involved in the CBD industry, Hempo Solutions provides invaluable guidance on everything from regulatory compliance to market analysis and strategic planning and helps to achieve competitive advantage.

Research the market

The initial step in starting a CBD business is completely analyzing the market trajectory and predicting retail trends for the next five years. A market like CBD, poised for significant growth, provides a solid foundation for making informed business decisions. Additionally, understanding the competitive landscape within the CBD industry is crucial. Observing competitors offers insights into potential business threats, opportunities for collaboration, and benchmarks for success. The CBD industry is experiencing rapid changes, with more businesses consolidating while the market itself becomes more fragmented due to diverse regulatory approaches across countries. This dynamic environment demands a strategic approach to ensure your CBD business not only enters the market effectively but also sustains growth and adapts to evolving conditions.

Find a reliable CBD products manufacturer

Finding a reliable manufacturer is crucial when starting a CBD business. A trustworthy CBD products manufacturer ensures consistent quality and compliance with regulations, which are vital for maintaining your brand’s reputation and legal standing. When selecting a manufacturer, consider factors such as their certification, production methods, and ingredient sourcing. It’s also important to verify that they adhere to good manufacturing practices and have robust quality control systems in place. Establishing a strong relationship with a reputable manufacturer like Hempo Solutions not only secures a steady supply of quality products but also enhances your ability to respond to customer demands and market changes efficiently.

Make a CBD business plan

Creating a comprehensive business plan is the cornerstone of launching a successful CBD business. This plan should outline several key aspects: first, choose a memorable and relevant name that reflects the ethos and offerings of your business. Analyzing the initial costs involved, such as licensing fees, inventory, and marketing, is crucial for financial planning. 

Your business plan should also estimate potential earnings. Researching what competitors charge and understanding the value of your offerings will help set competitive pricing strategies. Identifying your target market – whether wellness enthusiasts, individuals with chronic conditions, or casual consumers – will tailor your marketing efforts effectively. This will provide a solid foundation for your CBD business, positioning it for growth and success in the competitive market.

Create products design & a website

Creating a compelling product design and a professional website is an important step for establishing a successful CBD business. Your product design should reflect your brand’s identity, values, and target market. Invest in high-quality packaging that is not only aesthetically pleasing but also informative, ensuring that it complies with legal labeling requirements.

Simultaneously, developing a user-friendly website is essential for both ecommerce and brand visibility. Your website should be easy to navigate, visually appealing, and mobile-friendly to cater to all potential customers. Include detailed product descriptions, customer reviews, and educational content about the benefits of CBD to build trust. Additionally, implementing SEO strategies will help your website rank higher in search engine results, driving more organic traffic to your site.

Form a legal entity

Forming a legal entity is a critical step in establishing a legitimate CBD business. Choosing the right legal structure for your CBD business will depend on your specific needs and goals.

Hempo Solutions offers expert navigating CPNP services to ensure your CBD business stays ahead of compliance. The Cosmetic Products Notification Portal (CPNP) is a critical requirement for legally marketing cosmetic products in the European Union. With Hempo Solutions’ expertise, registering your CBD products with the CPNP becomes a smooth process. We guide you through each step, ensuring all necessary regulatory requirements are met. This comprehensive support helps you achieve market access without facing legal hiccups, allowing you to focus on reaching more customers in the competitive CBD industry.

Open a company bank account

When opening a business bank account as a CBD business, the safest approach is to use dedicated business banking. Mixing personal and business accounts can put your personal assets at risk if your business is sued or fails. By keeping your finances separate, you protect your personal wealth and consolidate your business accounting. Once you’ve opened your business account, it’s wise to get a business credit card. This helps to keep all your business expenses in one place, making it easier to manage your finances, track spending, and simplify your tax reporting. With these steps, you ensure a solid financial foundation for your CBD business.

Set-up shipping & delivery

Setting up shipping and delivery is a crucial step in starting your CBD business. Begin by researching and partnering with reputable shipping carriers that offer competitive rates and excellent service. Consider using multiple carriers to give your customers a range of options, such as standard, express, and international shipping. Additionally, invest in secure, tamper-proof packaging to maintain the integrity of your CBD products during transit. Implement a tough order tracking system to keep customers informed about their delivery status. Finally, establish clear shipping policies, including delivery times, return policies, and handling of damaged or lost goods. By carefully setting up your shipping and delivery processes, you can enhance customer satisfaction and ensure the smooth operation of your CBD business.

How to sell CBD products

When starting a CBD business, you have a choice between two general paths: opening physical stores or creating an online store. Opening physical stores involves a significant investment. You need to rent store space, furnish it, and stock it with your CBD products. However, with the rise of e-commerce, opening an online store is a more accessible and cost-effective option. 

To create an online store, design an attractive website showcasing your CBD products. Many platforms offer design templates that are easy to use, even for beginners. For instance, platforms like Wix offer user-friendly tools to set up your website, register your domain name, and host your site for a manageable fee.

The key to success: CBD of the highest quality

We know how important it is to have a good quality product. No matter how well-planned a CBD business venture is, it won’t succeed without a reliable and high-quality product. For this reason, it’s always worth opting for reputable suppliers with a proven track record in the sector. Hempo Solutions prides itself on being a well-known brand among users, which is why, during our expansion process, we decided to open a line of business offering wholesale CBD, private label CBD and white label CBD to other distributors and shops.

Getting the products to start your own CBD business

Hempo Solutions’s state-of-the-art factory produces CBD of the highest quality, extracting it from naturally-grown hemp as the sole raw material. Depending on your CBD business model, you can order unbranded CBD oil, isolate, or extract from the company in bulk quantities to use as components for making your own CBD products. Alternatively, you can collaborate with Hempo Solutions to manufacture ready-to-market branded products for you. The company will adhere to the exact product specifications that you provide. You can also let Hempo Solutions’s highly experienced development team create a bespoke brand for you from scratch. As you can see, the company is extremely versatile in its all-round approach to serving your CBD business needs.

Finding a reliable supplier

A quick internet browsing brings up a multitude of CBD product suppliers from all corners of the world. On closer inspection, many of them may turn out to be resellers that market other company’s products. It is, therefore, best to put your trust in a reliable supplier with a proven track record. Hempo Solutions manufactures all its CBD products and nothing is purchased from third parties. That gives Hempo Solutions full control over its product quality, which is constantly assessed and verified in the firm’s lab. This commitment to quality ensures that you receive the best possible products for your CBD business, helping you to build a reputable and successful brand in the CBD industry.

Key aspects to consider in selecting CBD suppliers

The CBD industry has grown rapidly in recent years, and with so many suppliers to choose from, it can be difficult to know which ones to trust. Here are some key points to consider when selecting a CBD supplier for your CBD business.

Product quality

Ensure the supplier provides high-quality CBD oil and other products. Look for suppliers who use naturally-grown hemp and have rigorous testing procedures in place.

Type of CBD

There are three types of CBD: full spectrum, broad spectrum, and isolate. Full spectrum CBD contains all the compounds found in the hemp plant, including a small amount of THC (the amount must not exceed 0.2%), while broad spectrum CBD also contains all compounds found in the hemp plant like cannabinoids, terpenes and flavonoids, THC is completely removed from it. CBD isolate is pure CBD without any other compounds. We suggest you find a supplier that offers the type of CBD that meets your needs – Hempo Solutions can offer you all different types of CBD oil.

Documentation and legal status

As we’ve mentioned, the CBD industry is one where regulations and legal aspects play a crucial role. When selecting suppliers for your CBD business, it’s imperative to choose those who have all the necessary documentation up to date and can provide support at all times. Here are the key documents you should request from your potential CBD suppliers:

Product analyses: these analyses must be no more than six months old. They should include the genetics of the seed certified by the EU and a batch number to ensure product traceability. This helps guarantee that the CBD oil or other products meet quality and safety standards.

Certifications: request certifications from the supplier that ensure the conformity of the products. These certifications might include the CPNP registration for topical and cosmetic products like CBD oil. Such certifications are crucial for ensuring that the products meet regulatory standards and are safe for consumer use.

Customer support and building reputation

When selecting a supplier for your CBD business, it is essential to evaluate their online reputation. Good suppliers are those who maintain a strong online presence and have a high number of positive reviews. Look for feedback and comments from other customers to indicate the supplier’s reputation. To do this, check their profile on review platforms like Google and Trustpilot, as well as other consumer review websites. 

Price

CBD products can vary widely in price depending on their type, strength, and quantity. When choosing products for your CBD business, it is crucial to consider the value and quality of the product in relation to its price. This ensures that you can achieve an acceptable markup while offering a quality product that meets market demand. As a retailer, your markup between the purchase price and the recommended retail price (RRP) should typically be between 35 and 60%, depending on the product. Balancing price and quality will help you maintain profitability while satisfying your customers with high-quality CBD products.

Creating your own CBD business (brand)

Instead of selling another company’s CBD products, consider creating your own unique CBD brand. This approach allows you to stand out in the CBD industry and build a recognizable brand identity. 

Offering a range of unique products is crucial to establish your CBD business successfully. Whether it’s CBD oil, CBD capsules, or CBD cosmetics, having diverse and high-quality products will attract customers. 

Hempo Solutions – a reliable partner for your CBD business

If you want to start your own CBD business, Hempo Solutions is the perfect choice to be your one-stop partner. Whether you need white label CBD products such as CBD oil, capsules etc. in smaller quantities or in bulk, Hempo Solutions provides the same high level of support. 

Our comprehensive services ensure that you receive uncompromising quality and high attention to detail. From conceptualizing your brand identity to producing top-notch CBD products, Hempo Solutions stands by you, making your journey into the CBD industry smooth and successful.

By partnering with a trustworthy CBD manufacturer in Europe, you can confidently navigate the complexities of starting a CBD business.