5 Keys to Choosing the Best CBD Distributor
Not all wholesale CBD companies are created equal. Before partnering up, look for these factors.
As the CBD market explodes, more and more retailers are partnering with CBD brands. Doing so lets business owners provide their customers with the products they want. But it can also lead to a conundrum: How do you find and choose the right CBD oil distributor for your company?
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During my time in the CBD oil business, I’ve unfortunately learned that there are many substandard products and brands out there. But I’ve also found that reputable businesses have a way of shining through. Great CBD oil companies tend to excel in five key areas. If you’re considering adding CBD oil to your business, look for these five factors.
1. Choose a high-quality product
There’s really no nice way to put this: There’s a whole lot of junk out there in the CBD market. Different extraction methods and different formulations lead to a huge variety of products and price ranges. Unfortunately, very few of these products are effective. Use these four guidelines to find a product you can trust.
Full-spectrum: If you’re going to represent a CBD brand, it should be a brand that is full-spectrum. Unlike CBD isolates, full-spectrum CBD products contain a wide variety of beneficial cannabinoids, vitamins, minerals, fatty acids, protein, chlorophyll, terpenes, flavonoids, and fiber that, when combined, produce enhanced results (also known as the entourage effect). A 2015 study entitled “Overcoming the Bell-Shaped Dose-Response of Cannabidiol by Using Cannabis Extract Enriched in Cannabidiol” found that full-spectrum CBD was more effective than isolates in treating inflammatory conditions. Choosing a full-spectrum product gives your customers better results. It’s that simple.
THC free: If it’s important to you to sell a family-friendly product that anyone can use, look for an oil that is THC free. THC is the cannabinoid that makes you high. As a simple rule of thumb, if a brand isn’t promoting that their product is THC free, it isn’t. The process to remove THC from CBD oil creates a much higher expense for the manufacturer, so many brands choose not to do it. It may cost more, but in my experience, it’s worth it to provide the option of non-psychoactive product.
Consistency: You’ll find some companies create their own broad spectrum formula. While you may get more benefits from these products than from an isolate, these formulations tend to be inconsistent. Look for a brand that uses consistent formulations from batch to batch to ensure you know what you’re getting.
Variety: Choose a wholesale CBD company that provides a number of different delivery methods. Products like tinctures, softgels, vapes, and salves best address different needs. Work with a business that provides a variety to ensure your customer’s needs are met.
2. Choose a company with great service
The current level of growth in the CBD market is leaving most companies overwhelmed. Poorly run CBD distributors are not set up to provide a high level of service. As a result, many retailers find themselves dealing with delayed orders, missing product, and unreturned phone calls. As you choose a CBD partner, choose a company that has a level of service that leaves you feeling confident.
3. Choose a company that fits with your standards
As you consider companies to partner with, take a close look at their branding. Any brand you partner with will reflect on you. Ask yourself which brands align well with the image you want to project.
Product packaging is a great litmus test. How are their products presented? Are items sold loosely, or presented in boxes? Are the materials high quality? Is the packaging easy to display? Is the overall effect in line with other products in your store? Will it appeal to the customers you service or want to attract? Align yourself with a quality brand for the best results.
4. Choose a company with logical pricing and product selection.
As you look at a company’s pricing and product line, compare their offerings with your target market’s ability to afford them. Most full-spectrum CBD products fall within the same price range. What differs is the types of products and the strength of their formulations. This is where it is important to understand your customers’ wants and needs.
Formulation strength is where you’ll notice the biggest misalignment between price point and customer interest. You’ll find companies offering 2000 mg or 3000 mg formulas. Not many people are buying these. Instead, they choose formulations that are less potent, less expensive, yet still effective. For most retailers, it makes sense to focus in on these products.
Another thing to think about is the broad appeal of the products you offer. There are a lot of funky CBD products out there. I’ve seen items like CBD cookies and CBD spices sell very poorly. I recommend staying mainstream with the products you sell. Choose a brand that offers tinctures, softgels, salves, and other products your customers have experience with.
5. Choose a company with great marketing support.
A company with strong marketing support will make your life much easier when it comes to educating your customers and employees on the benefits of CBD. Some good questions to ask when evaluating a brand’s marketing support:
Does the company provide brochures?
Does the company make samples available to purchase that you can distribute to your customers?
Does the company provide product displays?
Does the company provide signage, banners, and other materials?
Can you access education materials for yourself and your employees?
What other marketing assistance is available that you could benefit from?
As the CBD market continues to explode, it’s likely that the number of irreputable wholesale CBD businesses and products will also rise. Fret not. A small amount of research can go a long way in helping you choose the right partner for your establishment. Use these five keys as a guide to finding the partners and products that will enrich your business and improve your customer’s lives.
Louisiana’s New CBD Retail Sale Requirements Will Apply to All Online Retailers
By Courtney Barnes
Louisiana House Bill 843, effective August 1, 2020, includes several notable amendments to the state’s hemp production and CBD programs that will impact operators nationwide. While many of the changes to state law are intended to promote consistency with the 2018 Farm Bill, others are more unique. Notable provisions of HB 843 include registration requirements for online retailers and strict prohibitions and penalties on processing and selling smokable hemp. If you are an operator who produces, distributes, or sells hemp-derived CBD products in Louisiana, it’s time to start preparing to comply with these soon to be enforced requirements.
Retail Sale Requirements for CBD Products
In what appears to be a first-of-its-kind provision for state hemp program legislation, Louisiana will require online retailers—including those without a physical in-state presence—to obtain a permit from the state to lawfully sell CBD products directly to consumers. Once HB 843 takes effect, all CBD retailers, whether online or otherwise, are required to obtain a permit from the Louisiana Office of Alcohol and Tobacco Control (ATC), as well as register with and have their product labels preapproved by, the Louisiana Department of Health to lawfully to sell CBD products within the state of Louisiana.
HB 843 explicitly includes “remote retailers” in its CBD product retailer registration requirements, defining the term as “a person or entity who offers any industrial hemp-derived CBD product for sale at retail, or for any transaction of products in lieu of a sale, through a digital application, catalog, or the internet, that can be purchased and delivered directly to a consumer in Louisiana.” The bill clarifies that operators are not required to have a physical place of business in the state of Louisiana in order to sell industrial hemp-derived CBD products at retail and, interestingly, classifies each individually registered domain name owned or leased by an online retailer as a separate place of business that requires a permit. CBD products may be sold at events held at a location other than the permitted retailer’s place of business, but the retailer must first obtain a special event permit from the ATC.
CBD Product Manufacturing Requirements
Like other states, Louisiana requires that all CBD products be produced from hemp cultivated under a United States Department of Agriculture (USDA) or state plan adopted pursuant to the 2018 Farm Bill, or a 2014 Farm Bill pilot program. HB 843 continues the state’s prohibition on the sale of CBD foods unless approved as a food additive by the Food and Drug Administration (FDA), and further prohibits such products from being marketed as “dietary.” The bill also prohibits hemp products from containing any active pharmaceutical ingredient (API) recognized by the FDA, other than CBD.
Before being sold in the state, a CBD product must be registered with the Louisiana Department of Health and have its label endorsed. An application for registration must provide test results for cannabinoid concentration, solvents, pesticides, microbials, and heavy metals, as well as include various information about the product testing and method of analysis. CBD products may not be marketed or labeled with medical claims or sold to consumers under the age of 18.
Smokable Hemp Prohibition
HB 843 makes clear that the production and sale of hemp rolling papers are permitted, but explicitly prohibits and penalizes the processing and sale of all other smokable hemp products. The law provides authority to the Department of Agriculture and Forestry to issue stop orders to businesses and allows the commissioner of alcohol and tobacco control to issue fines for violations. Violators may be subject to a fine of $300 for a first offense, up to $1000 for a second offense, and up to $5,000 for third and subsequent offenses.
Hemp Producer Application Process
HB 843 fine-tunes and amends a variety of provisions relating to the state’s hemp license application requirements to align the 2018 Farm Bill and USDA interim final rule. In addition to defining terms such as “key participant,” and “federally defined THC level for hemp,” it amends the definition of “applicant” to clarify that an applicant is a natural person who applies for a grower, processor, contract carrier, or industrial hemp seed producer license on behalf of a legal business entity or other organization through which the business is conducted, as opposed to the business entity itself being classified as an applicant. For purposes of conducting background checks, however, the term “applicant” further includes key participant or designated responsible party.
Restrictive Hemp Producer License Eligibility Mandates
Although HB 843 retains the state’s criminal background check and license eligibility mandates, it’s worth noting the restrictive nature of these. Whereas federal law prohibits individuals who have been convicted of a controlled substance-related felony within ten years preceding the date of application from obtaining a hemp producer license, Louisiana additionally prohibits anyone who has been convicted of a drug-related misdemeanor within the two years immediately preceding the date of application from obtaining a license under its hemp production program. The act specifically states that “no person shall be eligible to obtain a license if convicted under state or federal law of any of the following: (a) a felony within the ten years immediately preceding the date of application; or (b) a drug-related misdemeanor within the two years immediately preceding the date of application.”
Making sure your products are compliant with state hemp and CBD regulations can be a full-time job. Click here for an easy way to stay up-to-date on cannabinoid product compliance in all 50 states.
If you have additional questions about Louisiana’s hemp production and CBD programs or are interested in applying for a license or permit, contact our hemp and cannabinoids team at 303-860-4501 or via email.
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