Entrepreneurs know that there’s always a risk when it comes to starting any business. It takes a special mindset and ambition to start something of your own, making it important to know the risks that come with your certain industry. While every industry has its own set of pros and cons, here are the risks that are presented to any CBD business owner.
The Risks of Starting a CBD Business
- High-risk consideration from banks and payment processors: CBD companies are considered high risk from financial institutions. Even though hemp is legal in all 50 states, CBD is still scheduled as a Schedule I drug from the DEA. While the DEA isn’t enforcing any legal restrictions with CBD, this is the issue causing unease for banks and payment processors. We’re always happy to recommend CBD-friendly banks and payment processors for individuals interested in starting a CBD company.
- FDA stance and waiting period: The CBD industry is still waiting for the FDA to release its regulatory program for CBD. Since the CBD industry is still newly emerging, regulations just aren’t set in place yet. That brings a level of uncertainty for companies in this industry, making it important to be adaptive and ready for whatever regulations are ahead.
- Marketing considerations: Like any dietary supplement company, marketing claims need to be scrutinized. This is definitely more true for CBD companies since there is a lack of clinical research and data available. Since CBD lives in the health and wellness space, companies need to understand how to be FDA-compliant with all of their marketing, product labeling, and content.
The Benefits of Starting a CBD Business
Great risks can bring great reward– there are some great benefits for starting a CBD business. That’s why so many individuals have been jumping at this opportunity.
- Easier licensing: CBD businesses don’t require the same level of complex licensing as the marijuana industry. This makes starting a business a lot easier and more attractive for those interested in being in the cannabis industry.
- Health and wellness: Starting a CBD company can be a great way to help people as long as you provide safe, non-toxic CBD products that are ethically sourced and produced. There is a growing interest in cannabinoid therapy, creating a significant demand for this industry.
- Highly-valued industry: The CBD industry was valued at $2 billion for 2019 with estimates of this rapidly-growing industry to reach $22 billion by 2025. The incredible growth structure forecasts that this industry is here to stay regardless of the obstacles with FDA and regulations.
Work with the Nation’s Number One White Label CBD Supplier
Hemp Depot is proud to share all the leading tips on how to start a CBD company. We understand the risks and obstacles that our industry faces but remain hopeful that these concerns will be worked out in the near future. We work with startups from all over the country to help them set up for success. With the nation’s number one white label CBD program, we’re honored to ensure the safest, purest CBD products for your company. For more information regarding our exclusive white label program, please contact us!