Starting Your Business With White Label CBD: A Quick Guide

Once a high-risk novel food is now a booming industry. Consumer demand for CBD is, no doubt, high and growing. Thanks to the legalisation of CBD’s recreational use in numerous states across the globe, there has been a significant increase in the number of individuals looking to experience the potential benefits of this wellness compound. 

Indeed, CBD is no longer a fleeting trend, but it’s here to stay. In fact, a 2019 report commissioned by the Centre for Medicinal Cannabis shows that the UK CBD market has a double-digit annual growth expected to hit approximately £1 billion by 2025. 

Now seems to be the best time for small businesses to dive headfirst into the CBD market and establish their own CBD brands. However, there can be several obstacles along the way, especially if you’re competing in a saturated market. You need to ensure the uniqueness, authenticity and compliance of your products in order to gain traction and survive the growing competition. Additionally, the required capital to set the business up and running can be reasonably high. Nonetheless, it’s plausible to bring your dream business to life as long as you understand the CBD game and know how to cut the long way short. White labelling might be the answer you’re looking for.

What Is White Label CBD? 

White labelling is a process where a manufacturer sells out re-brandable or re-sellable products or services to other companies who want to create their own brand with lower capital. Put simply, the white-labelled products are being rebranded under the marketers’ name to make it seem like they had made their products in the first place. 

White label production is typically used for mass-produced generic commodities, ranging from electronics to beauty essentials, basic foodstuffs and more. Of course, CBD is no exception. Various CBD products, including CBD gummies and capsules, can be manufactured by a white label company and sold to multiple retailers that set their unique brands on the package.

Investing in white label CBD products is relatively cheaper than manufacturing your own. The latter requires creating your own formula, which can take a lot of time and resources. For instance, you will need to hire experts and source ingredients from outside the country, which can be very costly. 

On the flip side, if you partner with a white label CBD manufacturer, you’ll likely save a lot of money because you simply pay for the product’s quality and not the prestige of an already-established brand. Wholesalers offer products at marked-down prices because they rely on the quantities of stock. 

As a retailer, you have more control of your brand image, pricing and marketing strategies. On top of that, you can place your products on the shelves without going through the nuisances and expenses required in the entire manufacturing process and supply chain. This will give you more time and energy to focus on other essential aspects of growing your business, including marketing and advertising.

Before you get started, there are some valuable tips to finding success in a crowded CBD industry that you should bear in mind.

Develop a realistic business plan

With many startup owners jumping on the CBD bandwagon, it is vital to have a well-crafted plan that describes what sets you apart from your competitors, where you want your business to go and how you can achieve your goals. Make sure your business plan contains adequate information about your business, especially if you’re thinking of presenting it to potential investors. 

Since some of them might not be familiar with the CBD industry yet, it’s good to have a business plan that elucidates your brand very well. Some of the important parameters to focus on when creating a feasible business plan include your products and services, target market, SWOT analysis promotional strategies, execution channels and summary of finances.

Understand current CBD laws and regulations

Gone are the days of operating in a grey area. Consumers can now safely purchase CBD products like any other common goods. Still, there’s a lot of confusion about the regulatory framework surrounding the use and sale of CBD products. Working with CBD manufacturers means you can count on should anything go wrong with the product, for example, non-compliance or customer dissatisfaction. Despite that, it’s essential that you understand the current CBD laws in your area to ensure your products’ compliance. 

In the United Kingdom, cannabis products abundant in tetrahydrocannabinol (THC) are classified as controlled drugs under the Misuse of Drugs Act 1971. The country does not permit the production, supply chain and possession of cannabis-infused products. Hemp-derived cannabidiol (CBD), on the other hand, does not fall in the same category as cannabis. It is, therefore, legal to sell CBD products within the UK, as long as they meet the following criteria:

• Obtained from hemp plants with less than 0.2% THC;
• Not particularly designed for THC administration;
• Not constituting a risk to health or making any health-related claims; 
• Contain no more than one milligram of THC per product container.

Take note that there has been a lot of movement going on in the federal regulatory structure relating to CBD in the past. Perhaps, more changes are set to arise in the future. Therefore, it’s important to stay up to date with the current CBD laws and regulations at all times.

Find a reputable white label CBD supplier

While investing in white label CBD is a great idea, you need to be careful when it comes to choosing the right CBD manufacturer. After all, your business depends largely on the products they create. Be clear on what it is that you are selling to your consumers to ensure their safety. 

To identify a reliable supplier, there are a few important factors to consider. These include its products’ source, quality, authenticity, compliance and pricing. Before you work with a potential supplier, get to know more about their farming methods and extraction processes to determine whether or not their raw materials and mechanisms meet the standards of the industry regulators. 

A transparent CBD manufacturer provides a certificate of analysis (COA), a detailed report showing the amount of THC, CBD and other molecular compounds used in the products. The purity, potency and concentration of each ingredient should also reflect on the COA.

Finally, if you want to establish a profitable CBD business, the products you will invest in must be affordable. Invest in a CBD manufacturer that provides reasonable pricing that does not compromise the quality of its products. Reviewing the pricing structure of your potential supplier helps avoid surprises like hidden fees, additional charges and high shipping costs in the long run.

Establish your brand

Once you’ve found your trusted CBD supplier, it’s easier to step into the CBD game. The truth is that CBD’s novelty is over. The market is already saturated with different CBD brands, competing over the same goal: to become number one. Consumers these days are not likely to buy “just any” CBD. You need to convince your audience that your brand is different from the rest. To do so, you must establish your brand first and foremost and make an impact. 

A website will be your ticket to the online market, so be sure to create an accessible and engaging website. In addition, it pays to invest in social media marketing to build a stronger web presence by connecting with a wider pool of audiences. Product diversification is another key if you want to expand your market. Providing a range of CBD products backed with enticing promotional campaigns is a great way to attract new customers and obtain repeat purchases. 

Success and survival can be challenging in the CBD industry, but your chance of winning increases when you have proper planning, a reliable supplier and a little bit of hard work and compliance.