Over the course of the past half-decade, growth in the cannabis industry has been significant owing to rising acceptance of the use of cannabis for medicinal purposes. According to studies, CBD oil offers individuals suffering from pain conditions and chronic diseases several benefits.
Savvy entrepreneurs looking to capitalize on the increasing demand for CBD products need to be aware of some potential pitfalls that could impact the profitability of their operations. Are you thinking about entering the CBD marketplace? If so, this article contains 5 tips to help you start a successful business in the legal cannabis industry.
First, it’s important to know that in 2016, the global cannabis industry was valued at an estimated $9.3 billion by researchers. The researchers forecast the industry to grow by 34.6% before 2025. So, now really is the time to get started in the industry before the competition becomes too stiff.
#1 Research The Industry
It’s likely you have some knowledge about cannabis and CBD products if you’re already asking yourself the question, “How do I start my own CBD oil business?” But, if you don’t, now is the time to start researching.
Make sure you also learn about cannabis-related laws in your locality. You’ll then need to carry out the steps associated with starting a traditional business, such as obtaining business licenses, a tax EIN and incorporation.
#2 Develop A Clear Business Plan
Your business plan needs to be actionable. It should have clearly defined steps and time constraints. Here are some essential factors to include in your plan:
- Market analysis for targeted customer profiles
- Funding sources and a business finances management plan
- Offline and online brand marketing strategies
- Realistic sales forecasts, industry trend prediction, and steps necessary to reach stated sales goals
#3 Source Reputable Suppliers
Whether your planning to distribute white label products or manufacture your own CBD oil-based products, you need to source reputable suppliers to work with. Make sure you know the origin of any supplier’s products. Lots of CBD oil used to be sourced from Europe, but nowadays you also find many US-based hemp growers in operation.
You need a certificate of analysis for any wholesale CBD oil you buy and such a certificate should be provided by the supplier. A COA confirms the product’s THC and CBD potency and purity levels. (Check here to view an example of a COA provided by a legitimate supplier.)
#4 Design A Website and Optimize It For Search Engines
It’s hard to survive as a business in 2021 without a visually appealing, fully functional website. Your website should be easy to navigate and offer secure ordering facilities.
Take some time to research different e-commerce website platforms to see which one will work best for your CBD business. Next, it’s time to start creating original content and following proven SEO techniques that’ll ensure your site ranks well on search engine results pages.
#5 Develop and Advertise Your Brand
You need to develop a unique brand and implement an effective marketing strategy to help reach your target audience and acquire a loyal customer base. Make sure you are in a position to answer all questions a customer could present you with otherwise you jeopardize your ability to gain a trustworthy reputation in the CBD niche.
Your marketing strategy should involve website content, SEO, email newsletters, and social media engagement. There are many guides online that will teach you how to best advertise your business online.