CBD has taken the world by storm. Some tout it as a miracle drug that can help reduce and manage a variety of symptoms, from anxiety to muscle fatigue to cancer-related ailments. It’s helped so many people find comfort and good health, and you could be a part of that!
Starting your own CBD oil business isn’t as hard as it may seem! Here are five steps on how to do just that.
1. Plan the Business
The first step is always planning your business. This includes calculating startup costs, finding your target audience, and naming your business. You should also calculate your break-even point.
Calculating expenses and break-even figures can be difficult. You may want to hire an accountant or professional to help you out. Expenses can differ depending on if you’re going to be growing your own hemp for your CBD oil, or if you’re collaborating with a grower or supplier.
Some of the startup costs include farming, suppliers, staff salaries, and insurance. You’ll also need somewhere to store your product, and need to account for shipping of products. Website costs, and any help you hire while setting up also needs to be accounted for.
Setting up a website is always a good idea, and acquiring an LLC is a must. You can do this through many websites — it’s a much quicker process than you might think. You’ll want to put your LLC under the same name as your business.
Your target audience for CBD oil is probably similar to other CBD oil businesses’: People who are looking for the benefits of CBD. Try to come up with a name that reflects this and brings in your audience, and sounds inviting. The same goes for your logo.
The more professional your business looks and sounds, the more customers you’ll attract. A well-made website, logo, name, and of course product, are crucial in any market.
You should also familiarize yourself with state laws surrounding cannabis and CBD. There are certain things you can’t promote with CBD products in some states. You can’t claim it will prevent or treat diseases, for example.
2. Take Care of Taxes & Open a Bank Account
If you’re opening a business there are a number of federal and state taxes you’re going to have to register for. These differ from state to state, with some having specific cannabis-related taxes. You may not be selling cannabis, but CBD is an offshoot of cannabis, so it counts.
To do this, you’re going to need to sign up for an EIN (Employee Identification Number). There are a number of websites out there that’ll let you do this. It’s as simple as signing up and waiting, so don’t hesitate on this one, as you need it to get selling.
After you’ve done this, you want to set up a bank account for your business. This will keep your earnings separate from your personal money and offer you extra protection for your assets. If your business is sued and you use the same account for personal and business, all that money could be at risk.
Many banks offer business-specific accounts that make filing taxes and accounting easier.
You should also consider getting a business credit card. It’s always a good idea to build your business credit history. This can help you raise money and invest later on as your business grows.
A business credit card ensures you’re not purchasing things for the business on your personal account. Keeping your money separate and organized is of the utmost importance to any business.
Business insurance is also recommended, and a legal requirement in some states. This ensures further safety of your shop, assets, and employees. This includes e-commerce markets too, so you’ll need to consider this even if you’re all online.
3. Get on Social Media, Market Your Brand
Something that’s often overlooked is social media. Advertising on social media and the internet at large is a crucial step in today’s market. If you don’t advertise on the internet, you could be losing out on a lot of potential business.
A big part of this is securing your social media handles. Get as many social media handles in your business’s name as you can. Twitter, Instagram, Pinterest, YouTube — if it’s available, you’re going to want to snap it up even if you don’t use it immediately.
Even if you’re not going to use all of these, it’s a good idea to have them. As your business expands, you never know where you might venture to advertise. If someone scoops the name before you do, they may even try to sell it to you for a huge markup.
Advertising is also a big part of running a business. Look into advertising on Facebook, YouTube, and Instagram to name a few.
Ads on social media platforms will show up to people who show interest in products similar to yours. So if someone is Googling CBD products or shopping on CBD sites, they’re more likely to see your ad. Make your ads appealing, informative, and clear, and you’re going to see a huge boost in business.
Building a CBD brand doesn’t have to be hard. Just know your market, know your customers, and stay true to your brand. If you do all this, you’re on the right track!
4. Make a Quality Product, Stand Out
The CBD marketplace is pretty saturated with competitors. If you want to stand out and get the marketing advantage, you’re going to need a quality product. It’s very important to consider where you’re getting your CBD, and who you’re working with.
Only work with farmers and suppliers you trust and vet when it comes to your product. Take a tour of the premises and test out the products for yourself. If it’s not something you’d use, don’t sell it.
Get third-party testing done and flaunt those results in your ads and to investors. The better your product the more likely it’ll be that people will want to be involved in your business. You can even pursue certifications for your CBD oil, like Good Manufacturing Practices, FDA, and USDA organic.
Do a little market research and see what the top competitors are doing, then try to work off that. Put your own spin on what’s working and try to improve on it.
There’s no shame in taking inspiration from what’s working. Just make sure you’re not outright ripping off another brand and putting yourself in the way of a lawsuit.
Taking in and using feedback from your customers is important. Take criticism and let it improve your product. The customer is always right, so listen to their needs and wants and sell to that.
You may also want to try collaboration with another more established presence. Other CBD startups looking for exposure may want to work together with you on a product, as it is mutually beneficial. Whether the business is bigger than yours or around the same size, the more exposure the better.
5. Build and Maintain Your Brand
Once you’ve got everything up and running, it’s time to maintain that. Keep consistent in your values and mission statement, continue to post to social media, and expand your product line. Consider hiring an employee to manage your socials and your advertising to make sure there’s constant new content coming out.
As you start making more money, invest that money into your business in smart ways. More advertising, better products, and a more professional website are some ways you can do this. If even one aspect of your business starts to fall, some customers will see this as a sign they should move on.
Pay close attention to your analytics. This goes for advertising, your costs and profits, and who your customer base is. If there’s a certain subset of people who aren’t using your product think about why that is and try making a product to attract them.
Get involved with your community and try to find companies that will support your brand. You could try sponsoring an event or team, or just getting your product into some local shops. Word-of-mouth is one of the best advertising avenues.
Customer service is also something that’s more important than ever. The worst thing is dealing with a company that doesn’t care, so be there for your customers.
Respond to their emails, their social media comments, and any cry for help they may present. Remind them why they shopped with you in the first place, and give them a reason to keep using your product.
Starting Your Own CBD Oil Business Is A Good Idea
This may seem like a lot. But once you get through the initial steps you’ll find that starting your own CBD oil business is a simple and rewarding experience. Follow the five steps above and you’ll be on your way to the top of the market!
For more like this, check out the rest of our blog. Contact us with any comments, questions or concerns.