What is the future of CBD?

2019 had promised to be the year that the burgeoning CBD industry in the UK really took off but, as so often happens in anything related to cannabis, the powers-that-be have been doing their best to interfere yet again. The debacle around classifying all cannabis extracts as novel foods has thrown a spanner in the works and while I believe this will only be a temporary problem, it’s certainly stalled progress. Similarly, while the passage of the Hemp Bill in

the USA (properly known as the Agriculture Improvement Act of 2018) was expected to resolve all sorts of issues including banking, payment processing, social media advertising, it’s actually raised new problems, giving the FDA power to prevent CBD products being marketed in food or as food supplements. None of the issues have yet been resolved and it looks like there is some time to go before the FDA clarifies its position. Unlike in the UK and EU though, the FDA does at least consult with its stakeholders. It’s even holding public meetings on the issue. As far as the EU and the FSA are concerned, they behave with the typical high hand of bureaucrats that we’re so familiar with in the UK and Europe. You have to fight to be listened to and they’re really not interested. They just pay lip service to consultation and whatever they say, they’re only interested in top down government.

The truth is that any progress on cannabis has to be fought for and that applies to defence as well as attack. Reform has had to be forced and we will have to force the regulators to abandon this attempt to misuse novel foods legislation. It’s

only by creating a media and public outcry or through the force of law that we prevail against the anti-cannabis brigade.

So where is this market headed and what can we do to make the most of the opportunities that are out there?

Humans have a remarkable record on cannabis. Despite concerted efforts to remove it from use, some would quite literally like to see the plant eradicated as if it were a disease like smallpox or polio, we never let it go. We always find a way to bring it back, to overcome restrictions, even if it means breaking the law. Over the years, across the world, many people have put their lives on the line to enable access to cannabis, either for themselves, their relatives or people who need its therapeutic properties. It’s not going away and the sooner that governments recognise this and stop the ridiculous policies of prohibition the better for us all.

It’s hardly surprising of course. With the benefit of modern science we now understand why we have such an affinity to the plant. We have evolved in a world where it offers a unique form of nourishment that is essential to our health.

Fundamentally then, the legal cannabis market is secure. What’s happening is a battle for control. On the one hand, many believe we should be growing and using the plant at a domestic level. There’s no reason why not. It’s relatively easy to grow and there are plenty of ways of processing it in an ordinary kitchen that don’t involve toxic solvents or dangerous techniques. At the other extreme, some want to see it very tightly regulated, so tightly that it would be beyond the means of all but big businesses. The effect of the novel foods classification, were it to go ahead, could mean a cost of £300,000 just to get a single product authorised.

Over the next few years there is going to be an explosion in new scientific evidence about cannabis.

Legalisation means that more and more money is being invested in research and even governments are now looking for the benefits of cannabis rather than focusing all effort on trying to prove that it’s harmful.

Unless there’s a completely unpredictable discovery that overturns everything we know already then I believe the new evidence will confirm both the safety and the beneficial nature of the plant and its components. Cannabinoids and the endocannabinoid system will become a target for more and more medicines research. In whole plant form, the products that we now sell as CBD oil will prove their worth as health foods and become even more popular than the multivitamins and health supplements that millions of us take every day. Hopefully, soon, the ludicrous restrictions on THC will be lifted and a choice of products will be available ranging from zero to some sort of absinthe equivalent. Yes there will have to be age restrictions and warnings on the packets but essentially cannabis will become as any other consumer product, the stigma will disappear and there will be accepted and rational laws around it.

So this market is going to expand even more rapidly. Much bigger businesses will get involved and some smaller ones will be squeezed out. Some products will become more like commodities and I expect all the supermarkets will have their own brands very soon. Your bog standard, 10ml bottle of 20% CBD oil will probably come down to less than £10 in the very near future.

So today’s CBD businesses have to make a choice. Do they want to become very high volume, commodity businesses? There won’t be room for many of these and inevitably, if they’re not now they soon will be part of a multinational conglomerate. Or do they want to develop a different model, smaller, more specialist, niche markets, artisan, superior service, luxury brands, local or other distinctive offering?

For most small CBD businesses, the latter will make most sense and that’s why it’s important to start developing your own special offering and market positioning now. There will be rocky times ahead. I may be wrong about the novel foods issue. The regulators may be forced to push it through and there will be mass casualties among small CBD businesses. So unless you just

want to give up now, now is the time to start making your business fit for the future.

There already many doing this successfully but if your business is simply in the business of selling vanilla CBD products, it’s time to start developing your own special niche. You have to add value to what will become a very widely available product. Marketing, branding, continuous new product development, these are the issues ahead as cannabis becpmes an ever more serious business.

Of course, there will be further developments. Once we have a change of government there could well be more significant reform on the way and if you’re already trading in the legal cannabis space it will be your opportunity to take. The online CBD businesses of today may become the retail cannabis dispensaries of the future, just like the stores you can now see throughout North America. One day soon they will be coming to British high streets.

The online CBD businesses of today may become the retail cannabis dispensaries of the future