Since the Agriculture Improvement Act of 2018 was enacted by the 115th US congress, the number of businesses stocking CBD for sale has experienced an upward trajectory. The Bill saw the legalization of CBD for sale to the general consumer who is aged 21 years and above. Therefore, so long as the CBD product doesn’t contain psychoactive properties, it is legal to sell to consumers who meet the age regulations. A challenge among businesspersons is being able to get started with the CBD distributing business. Are you interested in starting a CBD distributor business? In this post, I am going to break down the requirements to become a CBD distributor, easing your way to starting stocking CBD for sale to retailers or consumers. First, let us begin by understanding who a CBD distributor is and what they do.
What is a CBD Distributor?
A CBD distributor is primarily a seller who is in either the retail or the wholesale side of the business when it comes to stocking CBD for sale. The seller on the retail side sells directly to the consumer, while the reseller on the wholesale side targets the retailer. Therefore, the retailer sells in smaller quantities to the consumer while the wholesaler sells in larger quantities to the retailer.
How to Become a CBD Distributor
Here are the guidelines you will need to follow to become a CBD distributor:
Step 1 Determine the business model: Online or Brick and Mortar?
Are you going to start a CBD for sale business online or establish a brick and mortar retail shop? The two business models offer different advantages and disadvantages. Like when starting any regular business, it is expected that the entrepreneur weighs the advantages and disadvantages associated with either model. In some instances, you can choose to operate both online and brick and mortar retail shops. Therefore, you can enjoy the advantages of either of the two. If this is your choice, be ready to face different challenges.
The online sellers will need to place competitive adverts online, targeting the relevant online buyers. The retail shops provide the benefits of hands-on experience, allowing the seller to connect conveniently and engage with the customers who they provide products.
Step 2 Apply for relevant licenses.
After the famous Farm Bill was enacted, there have been no special licenses required to sell hemp or CBD products. Owing to that, the sellers do not have to send applications for special licensing. The licenses that you are required to produce include standard resellers license to permit online CBD sale. For the brick and mortar shop, you will be required to apply for licensing as applies at your local state. Make sure that you verify the state and local laws when it comes to stocking CBD for sale.
Step 3 Pick the right suppliers.
There are dozens of companies manufacturing CBD for sale through distributors. Some target appointed distributors while others sell to any stockist with proper licensing. The next job is to find out the legitimate suppliers and apply to partner in the CBD for sale business. The requirements may vary from one business to another, and this is depending on the business model that you have chosen. When managing the distribution process for your business, it is recommended that you choose the distributors you can work with easily. The most important approach is ensuring you have collaborated with a legitimate company. Some sellers try to cut corners, selling substandard products. Collaborating with such distributors may result in the cancellation of a business license. In that regard, it is imperative that you ensure you have collaborated with a legitimate business.
Get references from the existing businesses. Avoid doing business with a reseller who has a negative performance history. It is important that you read online reviews relating to the quality of the products they are stocking. Ensure their products have undergone proper testing and surpass the industry standards.
Step 4 Ensure proper logistics and establish customer care.
Now that you already have a target market and you have established links to manufacturers or existing distributors, it is important you consider issues to do with logistics. In some instances, the manufacturer may offer to deliver the CBD products to your doorstep. This is particularly if you are involved in a brick and mortar type of business. For those in online business, you can use the logistics service providers available online, to ship the products from the manufacturer to the retailer. This means that you will not need to make arrangements relating to storage. Ensure that your supplier will accept shipping CBD products directly to the customers, you have sold to. This one applies particularly to business owners who are using the dropshipping approach to sell CBD products.
Are you ready to start the CBD sale business? Follow the steps we have covered above to establish a successful business.