A Straightforward Checklist for Launching a CBD Brand in the United Kingdom
CBD is booming. That’s why you are here. Despite the USA being a half a decade ahead in terms of market development, the UK is already one of the major hotbeds of CBD growth in the world. The CBD market has already overtaken the Vitamin C and D markets combined in terms of overall sales with no sign of slowing down.
While human-based research into cannabinoids is still somewhat in its infancy the cannabis and CBD industry separate themselves from the general supplement industry as there is true biological evidence across thousands of studies that show cannabinoids have observable and marked effects on many aspects of physiology. In other words, they ‘work’ biologically speaking which cannot be said for the supplement industry as a whole.
While there are similarities to growing any business the cannabis industry throws up unique challenges for budding entrepreneurs which can prove to be major stumbling points if not properly planned for. We have documented the key things we learned as a brand a number of years ago with additional points from our more ‘mature’ selves now that we manufacture CBD products for some of the most well-established brands in the UK and Europe.
BRANDING
Branding is always important and goes beyond colour schemes and logos. Your brand is how the world sees you and should be consistent across all core media including your social media posts, your website and all other marketing materials. It is no longer enough to wack a cheap ‘CBD’ label on a bottle and expect it to sell. This market is flooded with cheap, knock-off brands and you need to stand out.
Some brands launch with specific purpose i.e. ‘I want this brand to be seen in high end retail’. If that is the case, then your brand needs to convey a high-end image from the get-go to convince buyers to not only buy into your brand story and image but to actually purchase your products. High end retail is typically not a fan of brands with very heavy cannabis imagery for example a logo made out of a cannabis leaf.
Appealing to the high-end retail market. Clean and bright.
Other brands take a completely different approach and really want to make clear their connection to the plant due to the importance of cannabis to their brand. These brands might employ cannabis-heavy imagery to attract existing cannabis users. The first question is ‘Who am I trying to sell this to and what would appeal to them?’. While you can create and find existing brands that have a generally wide market appeal, finding your core audience first is key.
Cheef promotes and is proud of its heritage. They attract existing cannabis advocates and users,.
Personal branding is also very useful in this space. As cannabinoids are beginning to be used in the medical world and by thousands of users for specific health support reasons, if you have a personal CBD story which is why you want to enter the industry then tell people about it. Make sure it is a core part of your story and clearly conveyed in your wider marketing materials. People love putting a face, name or specific story to a brand – it makes them feel connected to the products and helps instil trust.
PAYMENT PROCESSING & BANKING
Some businesses try their luck by signing up to PayPal or high street bank accounts by being selective in how they describe their business i.e., leaving out the part about cannabis! Don’t do this! If the banks or payment processors find that you have been deceptive, they will shut you down at the flick of a switch and may not release your funds. PayPal, Stripe and other leading payment processors do not process CBD in any form. A similar story is true for most , but not all, high street and fin-tech banks.
Numerous payment processors claiming to be the ‘next big thing’ in cannabis payment handling have been investigated and shut down over the last few months leaving many CBD businesses in turmoil and looking for alternatives. Even respected fin-tech banks like Anna which have fairly lax onboarding processes are not immune to being shut down or restricted overnight. Having a solid, reputable bank handling your money and a reliable and compliant payment processor handling transaction’s is absolutely critical for online payments. Issues with either of these can put an immediate halt to your business.
INSURANCE
It’s another boring entry but don’t ignore it! Quick expansion of the CBD and hemp industries in the UK has prompted an increased need for product liability insurance. Without the assistance of an agent who is well-versed on the ins and outs of the industry, you may fall victim to a claim that could seriously damage your reputation as an industry seller, not to mention cause you financial implications.
Just because CBD product liability insurance was created specifically for companies operating in the cannabis and hemp space, it is no different than regular product liability insurance. As a simple summary, CBD product liability insurance is useful/required when a customer feels as though he or she has been harmed by a faulty product. Even though your manufacturer will have insurances in place, the burden lies on the final seller of the product i.e., the brand or consumer facing business. CBD Insurance does not have to cost the world and is a real business saver should the worst happen.
As always, the best way to avoid issues related to issues like CBD insurance, payment processing and banking is to speak to a business who has learnt these lessons the hard way and have developed iron-clad solutions. The CBD Group is best known for being amongst the first purpose-built cannabis-product manufacturers in the UK but aside from our manufacturing capability, we provide unmatched support for existing and new CBD brands who need quick and reliable help with banking, payment processing and insurance. We can help even if you don’t manufacture with us.
PRODUCT TYPES
Tinctures and droppers remain one of the most popular CBD product types in the UK but they are but one of hundreds of types of potential end products. Some brands decide to offer a mixed range of products including cosmetics, topicals, edibles and oral products while others focus heavily on one product type and build their brand story about being experts in one particular field such as high-end CBD-infused facial serums or delicious vegan gummies. As well as having a substantial white label product list we are renowned for our New Product Development and general Research & Development work. If you are looking to create a new CBD product to stand out in an increasingly crowded market, we can help.
MANUFACTUERER
Choose a manufacturer that knows what they are doing and can guide you in the right direction; do they have scientific expertise, are they experts in their specific manufacturing field, have you tried samples, have you received example documentation and end product lab reports, have you seen or visited their factory or set-up? These are important questions to ask. So many ‘CBD Manufacturing Experts’ are Vape Companies that have tried to cash in on the CBD rush. By and large they don’t understand cannabinoid science and due to this they can’t create superior products. If you are entering a specific product industry especially a relatively new one, where possible you should look to work with a specialist manufacturer that knows your industry well both from a product knowledge standpoint as well as being very clued up on current regulations and laws.
NOVEL FOODS SUBMISSION
If you are thinking of entering the cannabis/CBD space in the UK and haven’t heard about Novel Foods, you need to get a beverage of choice, sit down and do some serious reading because this is the biggest shake up of the UK CBD industry has yet seen. CBD is now classified as a Novel Food. What this means in practical terms is that the industry needs to provide a wealth of safety data, historical use data and end product stability data to the UK FSA (Food Standards Agency) with the end goal to achieve designation as an ‘approved’ supplier of CBD products. Come March 31st 2021, companies which do not have (or are not named on) a submitted dossier are no longer allowed to sell their products in the UK. On the brand level this means you MUST have your name and end products specified on your manufacturers Novel Food Submission dossier in order to sell your products legally past March 31st 2021. If you are in talks with a manufacturer, you must demand their submission reference number. If they do not give this to you to check or otherwise ‘beat around the bush’ then they do not have one and are not cleared to manufacture CBD products in the UK. Please email or contact us directly for our submission reference.
SUMMARY
The CBD Group is a multi-service CBD product manufacturer. Not only do we design and produce world class CBD and cannabinoid products for our clients, but we help with all of the services listed in this article, carrying out much of the work in-house (Web, Branding, Graphics) or making appropriate introductions to 3rd parties that we use ourselves (Banking, Insurance, Payment Processing). Drop us a message or email any time if you need a hand.
This material does not constitute legal, professional or financial advice and The CBD Group LTD disclaims any liability with respect to this material. Please consult your legal representative or professional advisor on specific legal, professional or financial matters.
