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How to Start a CBD Supplement Line

How to Start a Hemp Supplement Line: Follow These 8 Simple Steps

How to Start a Hemp Supplement Line: Follow These 8 Simple Steps

CBD or Cannabidiol is one of the many cannabinoids present in the hemp plant. Its non-psychoactive properties and relaxing effect making it an ideal ingredient in health supplements for addressing cognitive health, pain management, digestive health, and much more.

Since the passage of the Farm Bill, CBD has dominated news headlines and the industry is experiencing phenomenal growth with no signs of slowing down anytime soon.

CBD Industry Facts

The time is ripe for current and aspiring brand owners to work with a qualified supplement manufacturer to create and bring a high-quality product to market. As with any new venture, though, it’s important to consider the risks and rewards before getting started and CBD is no exception to that rule.

We’ve leveraged our 50 years' of nutraceutical industry experience to help put you on the right path when it comes to learning how to start a CBD dietary supplement line.

How to Start a CBD Supplement Product Line - Infographic

Identify CBD Target Audience and Conduct Market Analysis

Like any other product, it is crucial to perform a market analysis to learn the trends and user demographics – to work out the sources of interest in various CBD products and finalize the target groups to focus on.

CBD Industry Statistic Quote

Research and Develop Your Product Idea

Out of the three primary CBD product types - oils, isolates and wax - that are further used to prepare different types of products including capsules, vapes, isolates, edibles, drinks, topicals, etc., oil is the most popular base ingredient, while vapes are the most in-demand CBD product followed by topicals. Choose the delivery method to focus on and then determine what is going to distinguish your product from the ones already being sold on the market.

Prepare a Powerful Business Plan

A robust business plan is vital if you want to map your success with CBD business opportunities and be able to effectively communicate strategies and goals to all stakeholders. Considering the following aspects may help.

  • Customer demographics and the type of CBD product you have finalized.
  • Source of money to support the business.
  • Product/brand name and strategies to generate sales and create awareness about your product.
  • Finalization of implementation and execution channels.
  • Realistic sales benchmark figures and strategies to achieve it.

Comply with Current Nutraceutical Industry Rules and Regulations

In spite of industrial hemp’s legalization, adding CBD to food and making certain health claims while marketing CBD goods should be strictly avoided under the current Federal regulations. Selling CBD oil doesn’t require a license; however, you need an EIN. It is wise to check the current state and local laws and stay in touch with the local authorities to ensure that you are following the existing laws.

Find a Reputable and Qualified CBD Supplement Manufacturer

A good CBD supplement manufacturer and a reliable CBD supplier are vital partners to ensure that you are

  • Sourcing high-quality and legalized raw material.
  • Following business processes that conform to FDA and state guidelines.
  • Guided through the process with authority and expertise.
  • Following FDA compliant labeling and packaging.

A turnkey service provider can be your best bet as they bring the capability to deliver your compliant CBD supplements to customers besides manufacturing them.

Correctly Label Your Product According to Industry Guidelines

Following FDA compliant labeling and packaging guidelines for CBD products is the key to staying off its radar. To accomplish this, ensure that your product’s labeling and packaging mentions:

  • Information about the part of the hemp plant that is present in the supplement.
  • The exact serving amount for CBD oil or extract.
  • Nutrition fact panel for foods.
  • Net weight in case of non-capsule products.
  • Accurate number of capsules in case of capsule products.
  • Product type in plain language.

Besides this, per serving CBD amount claims on the front packaging should match the ingredients panel on the back and the health benefits claims must be kept to what is acceptable for dietary supplements and food.

Gene Bruno, Twinlab's Senior Director of Formulation, has worked in the nutraceutical industry space for nearly 40 years and recently shared his knowledge of CBD labeling guidelines during one of his recent video podcasts which you can watch below:

cbd-supplement-label-facts

As discussed in the previous step, a manufacturer with turnkey capabilities, namely ab in-house packaging and labeling department, should possess the expertise needed to create a compliant CBD dietary supplement label.

5 Things to Avoid When Starting a CBD Supplement Line - Infographic

Marketing Your CBD Products

Now that you’ve identified your target audience and decided on the product you’re going to manufacture, you’re at the point where you need to craft your marketing strategy. Here are some key concepts to keep in mind as you’re going through this process:

  • Build and optimize a user-friendly and attractive website.
  • Select the right web-platform with required functionalities.
  • Provide original and compelling content with a strong SEO strategy.
  • Do not hesitate to market yourself. Also, encourage your staff to do the same and network.
  • Create a CBD affiliate marketing hub.
  • Research and leverage affordable social media influencers.
  • Leverage social media with effective hashtags and optimized profile.
  • Know where you can and cannot market CBD supplements. For example, Google currently does not allow CBD brands to advertise products on Google Ads. Additionally, Amazon has very strict guidelines as to how brands market and sell products on its platform. Do your research and stay on top of the latest news so you know where to allocate your advertising budget.

Start Selling Your CBD Supplement!

Know the benefits of online selling as well as selling in a retail place and decide your best fit.

Selling your CBD product online, whether through e-commerce sites like Amazon, or on your own website, looks like an easy, high-returns option, what with the wide internet reach and the low-setup costs, but comes with its own hurdles. With the CBD space being in a state of flux, the evolving policy limitations to what you can say about your CBD line on different sites, how you can name it or refer to it – necessitate constant vigilance, care and strategic thought in its marketing effort.

The brick and mortar store alternative is much more work and investment with a more localized reach, but the direct customer contact and interaction, builds product understanding and customer loyalty (both invaluable) like nothing else could.

Identify a CBD-friendly merchant processor - BONUS TIP

Should you decide to build a website in order to sell your supplement, it's important that you find a CBD-friendly merchant processor so you can accept transactions online. As of this writing, popular merchant account providers like PayPal and Square will not work with CBD companies and will not hesitate to shut your account down if you lie about the nature of your business. 

While these companies may eventually change their policies once the FDA and/or Congress determine how to best regulate the industry, Merchant Maverick has indicated that the following merchant account providers currently work with companies that sell CBD products:

  • PayWize
  • PaymentCloud
  • Easy Pay Direct
  • SMB Global
  • eMerchant Broker

Conclusion

Manufacturing and selling CBD supplements may be highly rewarding, yet challenging. Do not hesitate to contact a turnkey contract manufacturer, such as NutraScience Labs, to guide you through every step of the process. Request your nutraceutical manufacturing price quote today to start your own line of customized, high-quality dietary supplements.

June 19th, 2019

About the Author:

 
Andrew Goldman

Andrew Goldman is the Vice President of Marketing for NutraScience Labs. In this role, he leverages his 15+ years of B2B inbound marketing experience to develop cutting edge strategies for our firm. A health and fitness enthusiast, Andrew and his team won the 2012 Stevie Award for Marketing Team of the Year. He is also a two-time Best In Biz Silver Award winner for Marketing Executive of the Year and has received other honors and accolades for his website design work.