Starting Your CBD Business: What Actually Works in 2024

Virginia Miller

December 1, 2024

In this article

The CBD industry shows no signs of slowing down, with U.S. sales projected to exceed $16 billion by 2025. For entrepreneurs considering this booming market, selling CBD online offers tremendous opportunity—but navigating the complexities of this unique industry requires careful planning and expertise.

Understanding the CBD Marketplace

The cannabis and hemp industries have evolved dramatically since the 2018 Farm Bill legalized hemp-derived CBD products at the federal level. Today's CBD market spans everything from oils and tinctures to edibles and topicals, with new product innovations emerging regularly. However, success in this space requires more than just choosing products to sell—it demands a thorough understanding of regulations, compliance requirements, and industry best practices.

Hemp-derived CBD products containing less than 0.3% THC are federally legal to sell online in the U.S. However, state regulations vary significantly, and certain product types face additional restrictions. Before launching your CBD business, it's crucial to understand these nuances and how they'll impact your operations.

Establishing Your CBD Business Foundation

Legal Requirements and Compliance

Setting up a CBD business starts with ensuring proper legal compliance. You'll need standard business licenses and registrations, but CBD companies often require additional documentation. Research state-specific regulations where you plan to sell, and consider consulting with a legal expert familiar with the CBD industry. Many states require specific permits for selling CBD products, and some have stricter requirements about THC content than federal guidelines.

Finding Quality Suppliers

Your CBD business's success largely depends on product quality. When evaluating suppliers:

Request comprehensive certificates of analysis (COAs) for all products
Verify their hemp sourcing methods and testing protocols
Review manufacturing practices and facility certifications
Check their track record with other CBD businesses
Ensure they maintain proper documentation and licensing

Quality suppliers will provide detailed documentation about their extraction methods, testing procedures, and quality control processes. This transparency is crucial not just for compliance, but for building customer trust.

Building Your Online Presence

Choosing the Right Platform

Not all ecommerce platforms accept CBD businesses. Look for platforms specifically equipped to handle CBD sales, with features like:

Built-in age verification
CBD-friendly payment processing integration
Robust inventory management
Shipping restriction capabilities
Compliant checkout processes

Payment Processing Solutions

Payment processing remains one of the biggest challenges for CBD businesses. Many traditional processors consider CBD "high risk" and won't work with these merchants. Research CBD-friendly payment processors early in your planning process, as this will affect everything from your platform choice to your pricing strategy.

Marketing Your CBD Business

Content Strategy Essentials

CBD marketing requires a different approach than traditional ecommerce. Focus on education and building trust through:

Informative blog posts about CBD benefits and uses
Detailed product guides and documentation
Industry news and updates
Customer education resources
Transparent testing and quality information

Avoid making medical claims or promises about your products, as this can trigger regulatory issues. Instead, focus on providing factual, well-researched information that helps customers make informed decisions.

Navigating Marketing Restrictions

Many traditional advertising channels restrict CBD promotion. Focus your marketing efforts on:

Organic social media growth
Email marketing to opted-in customers
SEO-optimized content
Industry partnerships
Customer referral programs

Build your strategy around permitted marketing channels while staying current with platform policies regarding CBD promotion.

Operational Excellence

Inventory Management

Proper inventory management is crucial in the CBD industry. Implement systems to:

Track batch numbers and expiration dates
Monitor stock levels across channels
Maintain proper storage conditions
Document chain of custody
Manage returns and recalls if necessary

Shipping and Fulfillment

Understand carrier requirements for CBD shipping and develop clear protocols for:

Package labeling and documentation
State-specific shipping restrictions
International shipping compliance
Returns processing
Quality control checks

Building Long-Term Success

Success in the CBD industry requires ongoing attention to:

Regulatory changes and compliance updates
Market trends and consumer preferences
Product innovation and development
Quality control and testing protocols
Customer education and support

Stay connected with industry associations and legal resources to remain current with changing regulations and best practices.

Getting Started Today

The CBD industry offers exciting opportunities for entrepreneurs willing to navigate its unique challenges. Focus on building a strong foundation of compliance, quality, and customer education. Start with a focused product line, test your market, and scale gradually while maintaining high standards throughout your operation.

Remember that success in CBD ecommerce isn't just about selling products—it's about building a trusted brand that customers can rely on for quality, consistency, and expertise in the CBD space.

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FAQs

Can you ship CBD to all 50 states?

Yes, hemp-derived CBD products containing less than 0.3% THC can legally ship to all 50 states under federal law. However, some states have specific restrictions on certain product types, so it's important to verify individual state requirements before shipping.

How do you start selling CBD products online?

Start by registering your business and finding reliable suppliers who provide third-party testing certificates. Choose a CBD-friendly ecommerce platform, set up a secure payment processor, and ensure your product listings include proper disclaimers. Most importantly, maintain thorough documentation of your product testing and compliance measures.

What payment processors accept CBD sales?

Several payment processors work with CBD businesses, including Square, PaymentCloud, and Easy Pay Direct. While traditional processors like PayPal and Stripe don't accept CBD transactions, specialized high-risk processors provide reliable payment solutions for online CBD stores.

Can you sell CBD products on Amazon?

No, Amazon currently prohibits the sale of CBD products on their platform. This includes all hemp-derived CBD products, even those that are federally legal. CBD businesses should focus on building their own ecommerce store or selling through CBD-specific marketplaces.

Do you need FDA approval to sell CBD online?

No, the FDA doesn't currently require pre-approval for selling hemp-derived CBD products online. However, you can't make medical claims about your products, and certain types of CBD products, like those added to food or labeled as dietary supplements, face additional FDA scrutiny.

What's the most profitable way to sell CBD online?

Direct-to-consumer sales through your own ecommerce store typically offers the highest profit margins. This approach allows you to control pricing, build customer relationships, and avoid marketplace fees. Many successful CBD brands combine their online store with subscription models and bulk pricing options to maximize revenue.

Is selling CBD online profitable in 2024?

Yes, online CBD sales continue to grow, with the market expected to reach $16 billion by 2025. While competition has increased, businesses focusing on quality products, strong branding, and excellent customer service still achieve healthy profit margins, typically ranging from 20-40% depending on product type and sales channel.