Starting a CBD business? How to prepare for it?

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Cannabidiol or CBD is now a household name as more and more people realize its therapeutic and health benefits. It is a compound found in cannabis and hemp plants that finds wide use in dietary supplements, and there are promising prospects in doing business with CBD products. According to the industry projections, CBD sales are likely to touch the $20 billion mark by 2024. Although there used to be a lot of confusion about the legality of CBD, the introduction of the Farm Bill in 2018 has cleared all doubts, and it is now clear that hemp and CBD derived from hemp are legal. This has encouraged entrepreneurs to start the CBD business. 

People have realized how profitable it can be to start a business in CBD products, and they are exploring the opportunities to make a quick and easy start. You can now open your own CBD store by taking up a Texas CBD franchise offered by some of the leading CBD Franchise systems. You will get ready access to a CBD business model, including a steady supply of CBD products inventory that will make it easy to gain a foothold in the business. All that you must ensure is that your business goals must fit with the concept and brand that you intend to represent. 

The evolving legal landscape of CBD poses some serious challenges to entrepreneurs, and it needs some good education about CBD and its legalities to prepare for starting the business.  A good understanding of cannabinoid and the products that it goes into it is essential to make a confident start.

What is cannabidiol or CBD?

Cannabinoids are compounds found in cannabis and hemp plants, and there are more than 100 such compounds known to date. Cannabidiol, commonly known as CBD, is one such compound, and THC or Tetrahydrocannabinol is the more famous cannabinoid because it is responsible for the ‘high’ that people experience from consuming cannabis more commonly referred as marijuana. However, CBD does not have the mind-altering or intoxicating properties of THC and on the contrary, is supposed to offer health benefits, including several therapeutic applications. Research is going on to discover more health benefits of CBD because it has immense potential in doing good for humans in areas of medical applications. 

CBD manufacturing

CBD extraction from the cannabis plant consists of several steps, and the supply of raw materials must come from cannabis cultivation. Usually, industrial hemp is the source of raw material for CBD, but to maintain a steady supply of the raw material, you must either cultivate or purchase the plant. There are various methods of extracting CBD oil from the plant, which you can either do it on your own or outsource the process to an extraction company.  You can then sell the CBD oil as a concentrate or infuse it in many other products like infused edibles, sublingual tincture, and gels, creams, etc.  

However, taking up a CBD franchise does away with the need for manufacturing, and you will get a ready supply of CBD products for selling.

What makes CBD legal

The confusion about whether CBD is legal or not arises because the compound is available from both cannabis and hemp plants, which are also the sources of the dreaded THC compound that is illegal. This raises doubts about the legality of CBD products as it may contain THC strains. The most important thing to note is that THC is a psychoactive substance that produces ‘high’ only if the concentration is above a certain level when it becomes illegal. Now, the CBD oil derived from hemp and CBD obtained from cannabis have different THC content, and it is only 0.3% in industrial hemp. This means that CBD from hemp is legal, while CBD from cannabis has a much higher concentration of THC, which is illegal. If the CBD products you deal in are a derivative of the hemp plant, then even if it contains THC, which will be in very small quantity, it is always legal.

Industrial hemp is legal

The closeness of hemp and cannabis is not the only reason for the confusion about the legal status of CBD products. Since industrial hemp is a member of the cannabis family, it’s another name is Cannabis Sativa L, which makes people suspicious about its legality. However, the technical name assigned to hemp is more for legal clarity as it defines the threshold level of THC that is legally admissible.  THC is almost absent or present in a very insignificant quantity in the flowers of the hemp plant, but it is very high in the flowers of the cannabis plant. Since the latter corresponds to marijuana, it is a Schedule I drug under the Controlled Substance Act, which is illegal for personal use as well as for trading. On the other hand, Industrial Hemp is now out of the Controlled Substances Act, and it is legal to cultivate and harvest the plant as well as trade in CBD oil products obtained from it.

Products that you can deal in

A few CBD oil products are available for starting a franchise business, and what kind of products you can get depends on the brand you choose to market. Here are some of the commonly available CBD products, and there can be many more beyond it as the CBD industry keeps evolving.

CBD edibles – CBD oil infused in candies, baked goods, and foods constitute the edible variety that is commonly available in the market even though the US Food and Drug Administration keeps it under scrutiny.  

Sublingual tinctures – CBD tinctures are available in small bottles with a dropper, and people normally place a few drops under the tongue for proper ingestion by the body. 

Vape concentrates – CBD oils and waxes are used for vaping with the help of an electronic device that vaporizes the oil for inhaling the product.

CBD topicals – CBD has pain healing properties and available in the form of gels, sprays, and creams for applying on the skin in the affected part of the body. 

New products are coming up all the time and which products you intend to start your business with depends on your market research. 

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