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When the Farm Bill passed, it solidified the future of the hemp industry and opened the door for expansive opportunities. Now we are seeing companies across the nation start to scale their operations – from their equipment to the size of their factories. Cannabidoil, known as CBD, comes from the hemp plant and has therapeutic properties for human and animal usage. CBD is very different from THC, the psychoactive component that gives marijuana its traditional allure as a recreational drug. It is a non-psychoactive component of cannabis that’s popular right now.
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The seal gives retailers and consumers solace in knowing that the companies that have earned those seals sell products which have been properly vetted. The certification means that the product is legal, that it has been audited by a reputable third-party organization, that it is properly labeled and contains no harmful contaminants. The health and wellness benefits of CBD have inspired many entrepreneurs to create their own top CBD companies online. The mass emergence of the underground industry came after the Hemp Farming Act of 2018 was passed. It legalized industrial hemp and allowed hemp producers to become eligible for the federal crop insurance program and some USDA research grants.
Furthermore, businesses benefit from the rise of CBD because it’s a considerably higher-margin product than traditional dried cannabis flower. With tobacco smoking rates hitting a more than five-decade low in the U.S., the allure of smoking any product is waning. Instead, a new generation of cannabis users prefer alternative consumption options, including vapes, edibles, topicals, concentrates, and oils, to name a few. All of these higher-margin derivatives can be targeted at a CBD-seeking customer base with little fear of oversupply or pricing pressure. The hemp-derived CBD market, one that was given new life with the passing of the 2018 Farm Bill, is raking in more cash than a Mississippi pimp. Depending on which study you choose to embrace as gospel, it is well on its way to generatingin upwards of $20 billion a year.
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For a CBD company to survive the uncertainty and competition, they must document and manage all steps of the production process. First, CBD companies can easily standardize raw materials, formulas, and ingredients into cloud-based specifications. Companies can also create, manage, and version all packaging and label specs directly in the platform, making it easy to see what’s in market so they can stay compliant with changing regulations. The arrival of COVID-19 highlighted all kinds of challenges for small business owners.
It’s hard to think of another crop that increased production that fast, and even as the industry is growing like a weed, questions around how to build a supply chain that big and that fast are growing even quicker. For all its publicity, CBD remains unfamiliar to much of the market. Plan on educating consumers, distributors and retailers so they can rationally evaluate CBD products and make their choices with confidence. The beauty industry has been relatively quick to jump on the CBD trend, primarily through anti-aging, antioxidant and corrective skincare products. However, many other categories — think haircare, cosmetics and fragrances — could take advantage of these same restoration and recovery claims.
- This growth is attributed to the increase in demand for cannabidiol oil in various sectors such as pharmaceutical, food and additives, health and wellness, and cosmetics.
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- His success in the venture capital and cannabis industries drives his desire to deliver safe, quality CBD products to the market.
- With tobacco smoking rates hitting a more than five-decade low in the U.S., the allure of smoking any product is waning.
Now that it is legal to produce and distribute CBD in the United States, early movers in the space are setting themselves up for potentially massive profits. Numerous companies are focusing on developing better CBD-infused products, creating new forms of consumer-focused CBD consumables and getting those products to consumers as quickly and easily as possible. Companies ready to deliver CBD products to market at scale are in ideal position to capitalize on growing demand. Demand is growing for organic CBD products in markets where such products are legal. Asking for forgiveness rather than permission is a risky business strategy when the FDA can shutter your business.
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Some of thelatest statistics from High Yield Insights show CBD users are mostly “stressed out millennials” between the ages of 21-and-35 and baby boomers 56 and older. These folks are buying up a variety of hemp-based CBD products to treat every condition from anxiety and depression to chronic pain, inflammation and insomnia. Nutraceuticals dominated the market in 2019 with a share of 48.3%, owing to the rise in user shift from chemical-based ingredients to organic and herbal ingredients in dietary supplements. Retailers say they’re constantly receiving pitches from people asking to put their products on shelves. Chris Burton, retail partner manager at online CBD store HelloMD, grills brands on where their hemp is grown, how the CBD is extracted, where their lab tests are and more.
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ARLINGTON, Va. — The market for cannabidiol products is booming but new researchreleased today by the Grocery Manufacturers Association shows that consumers are confused about what CBD is, what it does and whether CBD products are safe. More concerning, with one-in-three Americans using CBD, the overwhelming majority (76%) assumes CBD products are subject to federal regulations and safety oversight when, in fact, no such regulations exist. Consumers are also starting to explore CBD-based where to buy honest paws cbd oil products for more than medication, such as sports recovery, and skincare and beauty. This new wellness segment is creating opportunities for alternative delivery formats—in the same survey, consumers reported using edibles, tinctures, vapes, and topicals to consume CBD the most. Canada is still one of only two countries to legalize cannabis on a federal level. It also has the resources to become a research leader, and expand product offerings based on changing consumer needs.
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- As though the market weren’t complex enough, products can further vary by flavor, dosage, package size and other attributes.
- VMR is the largest online e-cigarette brand in the United States from 2010 to 2017.
- But hemp doesn’t contain enough tetrahydrocannabinol to produce marijuana’s euphoric high, a distinction that has fueled the growing acceptance of hemp as a commodity crop.
- The company is headquartered in Miami, USA. VMR′s flagship brands include V2, V2 PRO, Vapour2, and Vapor Couture, which are sold in 30 countries around the world.
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The relationship between Silicon Valley, the center of the crypto universe, and wellness has always been complicated. The world of health startups is booming, as entrepreneurs search for new ways to improve worldwide healthcare systems with technology. But the culture of Silicon Valley itself has been described as a “pressure cooker” where overwork, stress, and burnout are common. Along with Designer Brands, privately held luxury retailer Neiman Marcus also moved into the CBD space in mid-January. Neiman announced plans to carry a variety of CBD products at five of its locations, as well as online. Since CBD products tend to be priced at a premium to traditional cannabis flower, it plays perfectly into Neiman’s attraction of a more affluent clientele.
Thus, in recent months, a number of federal courts have stopped these class actions in their tracks pending further guidance from FDA as to how CBD-infused products should be regulated. This growing body of precedent should be welcome news for the CBD supply chain, as it may provide a disincentive to the plaintiffs’ bar to expend their resources on similar actions until the regulatory framework is clear. In 2019, the B2B distribution channel segment accounted for the highest revenue share in the market. This growth is attributed to the increase in demand for cannabidiol oil in various sectors such as pharmaceutical, food and additives, health and wellness, and cosmetics. The increase in the number of companies selling their products via retail pharmacies is fueling the growth of the segment.
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Of course, a fair number have witnessed first-hand both the consequences of stress and anxiety and the benefits of treating it. Rapid market growth means that more CBD companies are popping up every day— a phenomenon that will feel familiar to anyone who’s spent time in crypto over the past two years. In both industries, companies have to genuinely differentiate themselves from their competitors to stand out. With knowledge of the industry, Verma Farms has gone for a organic, all-natural ingredient standpoint as they understand that customers are increasingly weary of something so new to market— just like blockchain. It’s no surprise that the same kind of people who are attracted to the crypto market are also drawn to the CBD market, fighting an uphill battle against confusion and hysteria is a transferable skill set after all. AJ Agrawal is an example of the crypto/CBD entrepreneur, he is the founder of crypto marketing company Verma Media and fast growing CBD oil company, Verma Farms.
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Please read these updated terms and take some time to understand them. Investors are more than willing to open their wallets to spend millions of dollars building these companies up. That’s going to leave a lot of small businesses out of luck competing against their more well-funded competitors. Small cannabis growers are already feeling the pinch and taking preemptive measures like forming co-ops to save on costs, have the ability to scale, and purchasing power to compete. However the handful of key need states – addressing sleeplessness, for example – remain constant across all consumer groups. New users of CBD products are seeking new solutions to recurring and chronic conditions.
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- As more people continue to acknowledge the benefits of using Cannabidiol related products, we can expect the demand for these products to keep rising.
- With a median age of 45, CBD consumers skew a little bit younger than the average American adult; in fact, “CBDers” are 46% more likely to fall into the 25-to-34 age range, and 20% more likely to be between 35 and 44.
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Top ChallengesEmployee Response Rate (%)Unable to unplug27%Loneliness16%Collaboration and communication16%Home distractions15%Motivation12%Different time zones7%Other7%Challenges and flaws to the remote model are inevitable. Employee Benefits From Remote WorkEmployee Response (%)Flexible schedule32%Flexible location25%No commute22%Family time11%Work from home8%Other2%In addition to happier workers, productivity has seen an untick as well. About 56% of workers report being slightly or considerably more productive during the pandemic. By contrast, only 28% report being either slightly less or considerably less productive.
- Our deep-dive into this exciting opportunity addresses many of the barriers that are preventing the industry from achieving its full potential and highlights those trends and developments that are driving the market forward.
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- CBD is a vast and complex subject area that touches on all aspects of the cannabis market – medical, pharmaceutical, recreational and packaged consumer products.
- It can be slightly more toned-down than other cannabis products in its presentation, as the package itself is the best way to tell the consumer about the product’s accessibility.
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Estimates of the Chinese hemp acreage in 2017 range from 100,000 acres to 200,000 acres or more. From a consumer perspective, certifying your products as organic is an additional way to provide both supply chain transparency and increase confidence when trying new CBD products. It also provides a form of quality assurance to skeptical consumers, especially those who avidly read product labels prior to making a purchasing decision. Members of this “label reader” demographic will consistently choose organic products for the quality and transparency they provide with pure and natural ingredients. There are several companies that specialize in manufacturing end-to-end finished CBD products. They commonly provide third-party test results, certificates and data to verify the purity and potency of products created.
As more people continue to acknowledge the benefits of using Cannabidiol related products, we can expect the demand for these products to keep rising. Furthermore, there is an increasing demand for ‘green medication,’ and CBD seems to be offering this alternative to consumers. Most skin care products in the market do not disclose the ingredients used in making them.
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I was envisioning a pretty hip character and was incredibly curious to see what the insights from MRI’s National Cannabis Study might reveal. With major categories and brands already strategizing on the best ways to move into the CBD market, this consumer segment is sure to grow exponentially. Sign Up NowGet this delivered to your inbox, and more info about our products and services. Burton says this “green rush” worries him that people seeing dollar signs are moving as fast they can to brings products to market. At 52%, the majority of consumers are using CBD to help with sleep and relaxation while 51% of consumers are using CBD to manage health & wellness and to treat various health conditions.
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U.S. CBD leader CV Sciences began selling CBD, with its PlusCBD Oil, before the 2014 Farm Bill was signed, by sourcing hemp from the Netherlands and having it processed into oil in Germany. In Europe, France is far and away the leader in hemp production—mostly for fiber and grain production. In 2016, France led Europe by growing about 35,000 acres, followed by Estonia with 8,500 and the Netherlands with 6,000 acres. In 1941, for example, Henry Ford introduced a prototype automobile built almost entirely of hemp—all the way down to the fuel source. In its December issue that year, Popular Mechanics declared that one day Ford would “grow automobiles from the soil.” Unfortunately, as hemp had been outlawed in 1937 because of its association with marijuana, the project stagnated.
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- Both naturally occur in marijuana/hemp and the farm bill legalized hemp products with only low concentrations of THC.
- This has put a massive pressure on companies to properly select suppliers and track the quality of raw materials.
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- Beyond smokable or edible items, cosmetics and topical lotions are also becoming more available on the market.
- 95% of the hemp that is harvested within the US is destined for cannabinoid production according to industry operators.
- Retailers say they’re constantly receiving pitches from people asking to put their products on shelves.
In addition, CBD can be legally sold without a prescription and is being integrated into many consumer products. While CBD’s popularity may be a sure bet, the risks of running a business in this space are manifold. Unlike a normal consumer goods company, products that incorporate CBD will be under special scrutiny Wie viele CBD-Gummibärchen sollte ich auf einmal essen? from regulators. Though the Farm Bill pushed hemp-derived CBD to the purview of the FDA—rather than the DEA—the FDA is making it clear that they won’t be a pushover. Prior to co-founding High Yield Insights, Mike Luce led multi-million dollar insights engagements with Fortune 100 consumer goods companies.
Numerous studies, including from federal regulators, have found a slew of products don’t contain the amount of CBD they say they do. Farmers won’t find out how much THC their plants produce until they’re harvested, dried and the CBD is extracted. During this process, the CBD becomes concentrated and the THC gets dragged along with it, Weiblen said, possibly to the point where the amount of THC exceeds the legal limit. Industrial hemp produces such small amounts of CBD that growing it and harvesting it to extract the molecule is incredibly expensive.
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From a supply chain standpoint, that is not only the biggest and easiest low-hanging fruit, but frankly, it’s also where the market is heading. Many of the industry’s consistency, traceability, and documentation issues can be addressed by overlaying cGMP in manufacturing facilities. Many manufacturers of premium cannabinoid products have taken matters into their own hands, going so far as to install all of the same equipment used in their partner’s third-party labs into their own quality control lab.
North America dominated the market with a revenue share of 68.5% in 2019 owing to ease of accessibility, growing awareness regarding various medical benefits of cannabidiol among users, and the rise in the number of manufacturers. Based on the type of product, the full spectrum oil segment dominated the market in 2019. In addition, CBD consumers are more likely to be engaging in relaxing, healthy, and creative activities while consuming cannabis products. One-third report reading during cannabis use, while 32% meditate , and 13% practice yoga.
The USDA organic certification program is a rigorous multi-step audit process to increase supply chain sustainability. Organic certification is a form of elective, self-regulation for manufacturers which consumers have eagerly welcomed into the marketplace. Look for the USDA organic seal to help identify which manufacturers are trustworthy and can produce a range of organic products. Hemp Inc, Cannabis Strategic Ventures, and Sugarmade are some of the latest cannabis industry investors.
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Arcadia Biosciences, a company that has bred wheat to be more fibrous, recently entered the cannabis space with the aim of growing hemp that produces more CBD and no or reliably low THC. Federal law says CBD is legal so long as it contains less than 0.3 percent THC. Most hemp farmers are growing the plant like a tomato, a process that’s expensive and intensive, said David Williams, an agronomist at the University of Kentucky who studies hemp. This model works for marijuana because you want the flower to look and smell nice. For hemp that will be used to extract CBD, this system is incredibly expensive and unnecessary since you only care about what’s inside the flower, Williams said.
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As highlighted below, a significant proportion of CBD and cannabis-infused goods users reported an increase in use as a result of COVID-19, mainly related to a number of health issues. Specifically, almost 30% of users in mature markets, such as the US and Canada, stated that they expected to increase their usage of CBD during the global pandemic, primarily to deal with stress, anxiety and as part of a wellness routine. Consumers want federal oversight of the rapidly expanding CBD market.
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CBD line Willie’s Remedy, explained that the company is just as “cautious about supply chain selection” when sourcing clean hemp as it has been in sourcing marijuana. Careful selection and experience sourcing in one sector can make your company well suited for the other sector. Leading industry experts offer advice on why having both THC and CBD products is important, how to speak to both consumer audiences, and demystifying the “versus” mentality between the two markets.