“You can’t tell the players without a scorecard.”
The well-known saying for those hawking baseball scorecards might be just as appropriate in the fledgling CBD category. With more and more players entering the marketplace and many predicting that the category is finally ready to explode in sales, retailers may need a scorecard to know who the players are in the marketplace.
According to Boulder, Colo.-based BDS Analytics and Arcview Market Research, the collective market for CBD sales, which includes cosmetics, health products, food and beverage, pet products, skin care, and pharmaceuticals, is expected to exceed $20 billion in the United States by 2024. Consumer Reports has noted that 64 million Americans have tried CBD, and one in seven people use it every day. Chicago-based Brightfield Group estimated the CBD market will grow to $23.7 billion through 2023.
There have been some acquisitions, and industry experts said there will be more. Manufacturers and retailers still are waiting for the Food and Drug Administration to develop regulations related to CBD in food and dietary supplements. Last November, the FDA sent warning letters to 15 companies “for illegally selling products containing cannabidiol (CBD) in ways that violate the Federal Food, Drug, and Cosmetic Act,” according to the agency’s press release. The FDA maintained that there is a lack of scientific information supporting the use of CBD in food, and also noted that the agency is continuing to explore pathways for various types of CBD products to be marketed. While they wait, many retailers are limiting their assortments to topical products.
Even banking regulations have changed to keep up with this evolving industry. In December 2019, four federal agencies — the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Financial Crimes Enforcement Network and the Office of the Comptroller of the Currency — and the Conference of State Bank Supervisors issued a statement together, clarifying the legal status of hemp growth. Even though hemp growing was made legal with the Agriculture Improvement Act of 2018, banks that provided services to hemp-related businesses had to file suspicious activity reports, or SARs. The statement emphasized that banks no longer are required to file an SAR solely because a customer sells hemp-related products.
In the meantime, there is nothing suspicious about the growth CBD companies are enjoying. Manufacturers are continuing to generate excitement by launching innovative products, expanding distribution and moving into new facilities. Retailers that want to satisfy consumer demand for an expanding array of products said certain consumer trends are driving sales. Here is a roundup of what some of the top companies in the CBD space are doing
The Alkaline Water Company
Founded in 2012, The Alkaline Water Company produces premium bottled alkaline and flavored water sold under the brand names Alkaline88 and A88. The Scottsdale, Ariz.-based company recently announced a broad line of CBD infused topical and ingestible products. For its topicals line, A88 infused products produces salves, balms, lotions, essential oils and bath salts, all made with lab-tested full-spectrum hemp. For its ingestibles line, the A88 Infused Beverage Division produces CBD-infused drinks, beverage shots, tinctures, capsules and powder packs.
CBD Unlimited develops and distributes such products as oils, capsules, topicals and pet products, all with the focus on therapeutic and pain relief for humans and pets. The Cave Creek, Ariz.-based company is launching two topical products, expanding its current offering from two to four topical products. It will also soon unveil two ingestible products, hemp-derived CBD-infused chocolates and honey sticks.
Family-owned Joy Organics was co-founded by Joy Smith, who struggled with sleep and other issues and wanted to find a natural solution, and her husband Todd Smith, who has 28 years of experience at a metabolic health company. Joy Organics directors and managers include Joy Smith’s two daughters, as well as Todd Smith’s brother and sister-in-law. “We started in April 2018, and we expanded to other members of the family,” said Todd Smith, who added that his son Jared handles digital marketing.
CBD is different from other industries, Todd Smith said, because of the lack of federal regulations and the wide availability of products and information online. “I’ve never seen anything where results of trying the product are actually driving the industry,” he said. Topical products from Joy Organics include CBD Salve Balm, CBD Salve Stick and, to help the consumer unwind after a long day, CBD Bath Bombs. The company plans to roll out a CBD Lip Balm soon. The Fort Collins, Colo.-based company has a goal of making all products under a retail price of $40 to make the products more accessible to consumers.
Todd Smith, who is chief partnership officer at Joy Organics, sees a bright future for the category. “In 10 years, CBD will be the No. 1-selling supplement,” he said. “This is the tip of the iceberg.”
CBD products should help people in all demographics, and MarketHub is doing its part by managing the category for Dollar General Stores. “They’re looking at and answering consumer demand,” said Blake Patterson, CEO of Denver-based MarketHub. “CBD is good for everyone.”
As a wholesale partner, MarketHub vets products for retailers and helps stores with merchandising, legal, customer engagement and other areas. MarketHub is the exclusive hemp category manager for Dollar General, which will sell topical CBD products, mostly pain and beauty items, in 4,500 stores. The products are all $19.99 or less at retail, a price point that reflects CBD’s growing distribution. “We’re just looking at different channels and markets that are nontraditional for their space,” Patterson said. “I think that two years ago you could find these products only in specialty kinds of natural shops.”
Officials at Quicksilver Scientific said they are changing the way consumers take dietary supplements by launching a new line of products. Quicksilver Scientific’s CBD Synergies line is available in three formulations that combine the power of CBD and other effective nutraceuticals and botanicals, boosted by the proprietary Quicksilver Delivery Systems. The new products are AX-Calming Formula, SP-Sleep Formula and PN-Relief Formula. The proprietary Quicksilver Delivery System provides greater bioavailability and more immediate uptake for such difficult-to-absorb supplements as CBD and curcumin. “We are combining the power of CBD with the best ingredients in the natural health toolbox to create targeted remedies that fully express each of the many aspects of CBD’s broad range of beneficial effects,” said Christopher Shade, founder and CEO.
Uleva Products recently reformulated four of its original products in dye-free, vegetarian capsules. The four formulas are Flex with glucosamine and chondroitin, Fuel with green tea, Relax with ashwagandha, and Sleep with melatonin. On the horizon for Uleva are three new capsule SKUs — Focus, Vitality and Sleep 2.0 — along with a skin care line. Contract Pharmacal manufactures Uleva in Hauppauge, N.Y.
Boulder, Colo.-based Wana Wellness recently introduced Mixed Berry Hemp Gummies and Tropical Hemp Gummies, made with fruit pectin so they are vegan. The gummies are infused with Colorado-grown broad-spectrum hemp oil. The packaging has product batch numbers so consumers can look up contaminant and potency test results related to CBD content.
“Wana Wellness products are THC free, and we’ve included the test results as proof on our website since the company’s inception,” said CEO Nancy Whiteman. “Customers have an appetite for transparency and safety, and we knew it was our duty to provide this service to anyone seeking the benefits of hemp supplements.”