According to an analysis done by Brightfiled Group, the CBD market in Europe is likely to grow by 400% in 2023. Comparing this to the market of CBD in the US, Europe is gradually catching up. The European CBD market can be quite lucrative if you know how to infiltrate it. CBD being a relatively ‘new’ product, many consumers are yet to understand its effectiveness. And so does the authorities.
Allow us to refer to the European CBD market as immature. The reason being, the laws are quite complex especially those that touch on hemp-derived CBD. Considering the high number of countries in this continent that are member states and have their laws and regulations. However, what does that mean for the smart investor that wants to venture into the European CBD market? Here are 5 factors you should consider.
- Novel Food Regulations on CBD
European regulators consider CBD as a novel food. In that, it is a food that wasn’t used for human consumption within the Union before May 15th, 1997. And as a result, should you intend to sell CBD products in Europe, you must acquire a license from the European Foods Safety Authority (EFSA).
This is one of the biggest challenges of entering the European CBD market. This law was enforced early in January last year. And what makes so complicated is that it was applied to an already existing market. Therefore, as we speak, there are plenty of CBD outlets that continue to market and sell their products without this license.
As a newcomer to the European CBD market, going about the novel food regulations can be time-consuming and costly. However, the Association of the Cannabinoid Industry (ACI), has advised buyers to get in touch with their suppliers and confirm the status of Novel food application on their CBD products. According to the ACI, it is easier for brands to sell on retail CBD products that have passed the Novel Food Regulations. More so, it is more convenient if suppliers apply for the Novel Food licensing as they are responsible for manufacturing the finished product.
Depending on whether you want to enter the European CBD market as a brand or manufacturer, you must understand the novel food regulation. In countries such as Italy, Spain, and Austria, their respective cannabis associations have taken action against the labeling of CBD products as novel foods.
- Legal Status of CBD in Europe
Another big hurdle for investors interested in getting into the European CBD market is the varying set of laws. Currently, Europe is yet to make a unanimous decision on the legal status of cannabis. You should therefore expect to come across different laws even in countries that share a border.
Kindly note that CBD is legal all over Europe except in Slovakia. The word legal however differs in terms of how much one can possess, use, or freedom to cultivate. Another area where cannabis faces fluctuating laws is in Italy. The country initially enjoyed a period of legal hemp, before they were revised. Nonetheless, CBD shops are still in operation.
While we are still on the legal status of CBD in Europe. It is imperative to know that not all CBD products are equal here. In countries such as the Netherlands, you won’t be able to find THC extracts or CBD isolates. Nonetheless, as stringent as these laws are, the CBD market is booming. And the more consumers learn about the effectiveness of CBD, the sooner these laws will start to be amended.
- Partnering with a Reliable Producer
You have already figured out the above two laws, now you are stuck wondering what’s next. Well, the third factor you should heavily consider is where I can find a reliable producer. Without a reliable producer who will give you quality CBD, there is no way you are going to survive this market.
According to Nordicoil.com, one of Europe’s leading CBD brands, a vendor needs to highly consider where they are getting their products from. As much as the marijuana plant is the same, irrespective of where it’s grown, the process of selection of raw materials and ingredients contribute heavily to the final product. At Nordicoil, the team of experts thoroughly investigate all the ingredients and raw materials before sending it to the lab for testing and preparation.
Thoroughly research on who are the best producers of Cannabis in Europe and partner with them. This way you can be assured of getting a steady supply of quality CBD products for your customers.
Don’t be misled by the perception that CBD is fairly new in Europe and that there is no competition. If you scour the market, you will find lots of CBD shops and plenty more online. Whether you want to open a shop or store online, it is essential that you are aware of the lingering competition.
To survive in the European CBD market, you need to create a brand with a story that stands out. It’s not just about opening up a store and stocking your shelves. You need to emphasize who you are and why people should buy from you. Most importantly, you need to associate yourself with quality.
A pro tip that can help you thrive in this fierce competition is educating your consumers about CBD. As the expert here, you can offer the knowledge you have on the effectiveness of CBD through blog posts, videos, or through social media.
- Capital and Time
To enter the market swiftly, you need to have enough capital. If you have set some money on the side, conduct a quick valuation to assess whether that money will be enough to get into the CBD market. Remember, you can always start small and grow your way up into a big brand. If your funds are inadequate, you can always secure funding from both private and public financial entities.
The other thing that you need to consider is time. If you look up future predictions on CBD, it shows that its demand in Europe is rising. If you start your CBD business now, by next year, you will have made lots of profits. So, what are you waiting for?