Business opportunities in the CBD industry
In this article I’d like to tell you about the different opportunities for your company in the CBD market.
I have represented the biggest European hemp producer in every trade show in Europe, and I know everybody in the industry. I know how frustrating it can be for a newcomer to navigate this space. If I want CBD vape, where do I get it? Who has the best RAW extract? Who makes CBD gummy bears?
The terminology can be confusion because the same words are often used to mean different things.
To start off, I’ll explain the terminology we use to qualify your business. Starting with the difference between bulk, retail, wholesale, drop shipping and white label.
Difference between bulk, retail and wholesale CBD (Cannabidiol)
Bulk CBD – unbranded product
Bulk: large quantities of unbranded product, for example 10 kg of winterized, decarboxylated extract. This is most interesting for secondary producers, who need CBD extract as an ingredient for the products they manufacture.
Wholesale CBD – Business to Business (B2B)
Wholesale: a wholesaler is a business that sells products to other businesses. A wholesaler normally has a product catalog, and pricing can only be accessed by other qualified businesses, usually retailers.
Retail CBD – finished, branded products sold to the consumer
Retail: a retailer is a company selling finished products to the final consumer. To qualify as a retailer, you need to have a storefront or website, and be legally registered as a business. You should be able to show a corporate registration number and a tax number. A retailer typically has two options: sell existing brands’ finished products, or start a white label of their own.
Whitelabel CBD – Ready made products with your own brand
Whitelabel: it would be more accurate to call this no label. Whitelabelling a product means you buy a product from the producer without their label on it. You are responsible for creating your own labels and boxes with your brand, although some producers offer to do this job for you, at a certain cost. However, we advise keeping the branding and labelling under your own control. Conflicts often arise over changes to the label, misprints etcetera. If you are too small to handle labelling, maybe you can consider selling other brands to grown your company, and if you are a bigger company, it makes more sense to have full control over this aspect of the business.
Dropshipping CBD – Selling other CBD brands through your website
Another way of doing business that is gaining popularity is dropshipping. Dropshipping is a way to sell products, without having to stock or send them yourself. You do the marketing and or advertising, and handle customer care. When you make a sale, you transfer the customer data to your drop shipper, and they fulfilled the order for you.
In the next article, I’ll speak about what CBD products are available on the market, and what the differences between them are.
Firstly, thank you for a very informative website! Meanwhile, we are considering hemp production here in the UK from the approved EU varieties. Research indicates the typical % of CBD from these strains are around 2-3%. If however, you are aware of a strain that can lift this percentage to 4% + I would very much welcome your advice.
Your kindly,
Martyn Ellis
Hi Martyn,
thanks for reaching out and best of luck with your production plans. We suggest you experiment with different genetics and see which one performs the best under your local growing conditions. Variation occurs according to the weather and the methods you use. We will reach out in our network and see if one of our UK contacts has more specific advise, we’ll send you any useful info we get by email.
Hi Lise,
thank you for your message,
please forgive me for not publishing this message, as we don’t want any info that can be construed as a health claim on our website.
greetings from the team,
Thanks for the information. Do you also offer dropshipping as a service for white label products?
Hi Michael,
thanks for asking.
It’s in the pipeline for later this year, we’ll keep you updated.
You can enter the contact form and mention ‘dropshipping’ and we’ll notify you when the program opens,
Hi Adriaan,
Thank you for the information
I am starting a research into de European cbd market, do you have any tips on where to find valid information about the market and who to speak to.
Thank you in advance,
Daan.
Hi Daan,
we are trying to share as much info as we can here,
we have learned a lot from reading the articles on projectcbd.org
is there any topic you are particularly interested in?
I’m interested in the all the regulations in the EU, the target audience in the EU and the channels through which CBD is sold.
Those are some major topics, too big to cover in a post perhaps.
It is good to familiarise yourself with the new listing for cannabidiol in the novel food guidlines, however it’s not sure what practical implementation will look like on a memberstate level.
Target audience is wide and fragmented, with a wide range of usecases. The biggest channels we see are independent websites, distritutors of herbal preparats, health and wellness, and cosmetic brands. And off course the CBD vape segment. The edible market is underdeveloped and we expect strong growth in the coming years.
We also expect capsules to grow faster than other formulations.
Hi Adriaan,
Thank you for your answer, it helps me out a lot!
Hi Daan,
that’s very nice to hear!
We’d love to stay in touch and follow your progress,
good luck with you project.
Hi Adriaan,
we started outdoor growing medical cannabis in Africa. What we need for weed buds wholesale in EU?
Manufacturer’s license, laboratory certificate, special packaging or something else? documents, more EU certificates?
Regards,
Sergii
Hi Sergii,
are you operating under a pharmaceutical licence?
no, growing and export license
and maybe better to write to email?
Hi Adriaan,
I got another question for you. Can you tell me in which countries within Europe you can legally buy CBD online?
Thank you!
Hi Adriaan,
I have another question. Can you tell me what the biggest CBD markets are in Europe?
Thanks!
The biggest market in the first half of 2019 has been the United Kingdom. Germany is the next big thing.
Hi Adriaan,
Thank you for the article.
I was just wondering what the legalities are in regards to extracting CBD bulk, if you for instance use the strain Finola-314 that supposedly contains 0.15% THC and around 8-9% CBD.
If you manage to extract those 2 compounds to be 100% of the extract, you would have around 1.6-1.8% THC, so until you dilute it you would have an illegal substance and if this is the case, do the companies that produce these products work in a grey area or are they licensed to handle/destroy/reduce small amounts of THC or operating out of a specific EU country?
Best regards,
John Ulv
Hi John,
the issue you raise is significant.
The answer depends on the member state or country involved.
Plant extraction itself is strictly regulated in certain member states,
in others there are less restrictions.
An extraction never results in 100% cannabinoid content as there are impurities in every method of extraction (chlorophyll and plant-fat to name a few).
Either way, the issue you raise is relevant in almost every hemp extraction I believe.
Thanks for raising it here,
and thanks for your interest.
Do you know which countries have the most clear rules in this regard? I have some acquaintances that are looking to have their hemp refined into CBD, but they are unsure which lab in what country is the best for it in regards to the law.
Would be very interested in your drop shipping service. When do you expect to start it?
Thanks
Hey Nigel,
thanks for reaching out.
We are now testing the systems, and will be taking on a select few clients to test the scaling up,
this should be ready before the end of the year.
Please keep in touch,
Hi. Just wondering if the dropshipping service up and running already? If so, would it be possible to ship to UK? Thank you.
Appreciate it for helping out, great information. “Our individual lives cannot, generally, be works of art unless the social order is also.” by Charles Horton Cooley.