In the USA alone the CBD oil industry in the USA is expected to explode to $20 BILLION in sales by 2024.
Before we get to the ins and outs of CBD dropshipping, let's take a look at the product itself.
CBD, short for cannabidiol is one of more than 100 different cannabinoids, which are chemical compounds found in the cannabis plant that act on cannabinoid receptors in cells that alter neurotransmitter releases in the human brain, and a byproduct of both the marijuana and hemp cannabis plant.
CBD has started to gain a lot of popularity because of its medicinal properties. Studies show that CBD has powerful anti-anxiety, anti-inflammatory, anti-convulsant, and pain-relieving properties.
Is CBD Oil Legal?
CBD is a controlled substance under United Nations drug control conventions.
In the USA, the government classifies cannabis plants into 2 categories;
- the hemp plant is less than .3% THC (that's what gets you high)
- and the THC that comes from the marijuana plant has more than .3%
Hemp plants have a higher concentration of CBD than marijuana so it is a better choice for extracting CBD. Also, it is legal to grow in all 50 states with the passing of the 2014 Farm Bill.
In 2018 the USA passed an updated Farm Bill which clears up the confusion of the legality of CBD. It states that hemp prohibition is over, and that hemp has been removed from the Controlled Substances Act. CBD is now deemed an agricultural commodity. This also includes extracts and derivatives.
In Canada even though it has legalized marijuana, because of the EU stance, it is considered a controlled substance.
As a result, CBD and products containing CBD are subject to all of the rules and requirements that apply to cannabis under the Cannabis Act and its regulations.
- Under the Cannabis Act, CBD products remain strictly regulated and are only legal when sold in compliance with the Act and its regulations. This includes CBD derived from industrial hemp plants, as well as CBD derived from other varieties of cannabis.
- You must have a processing license to manufacture products containing CBD for sale, no matter what the source of the CBD is.
- CBD and products containing CBD, including cannabis oil, may only be sold by federally-licensed sellers of cannabis for medical purposes.
In the EU which at the time of this writing still includes the UK, for CBD oil to be legal, it must contain no more than 0.2% THC. This will likely be lowered to .01% in 2020. Also, the THC must not be easily separated from it.
- CBD packages can’t be labeled with medical claims like CBD content, manufacturer details or ingredients. For a productive and efficient hemp market, the rules in the EU on industrial hemp cultivation have been harmonized.
- EU and non-EU farmers that wish to market industrial hemp in the EU must meet the regulations laid down in a number of Directives.
In Australia, the government legalized cannabis for medical reasons in 2016. They reclassified CBD from a prohibited drug to being legal by prescription only.
CBD is still highly regulated and available to only a limited number of people with a medical prescription (with no exceptions).
Regardless of where you live it would be prudent to know the laws and the tolerance of the police in the area where you live.
If It Doesn’t Get You High What Is It Good For?
A study in Molecular Neurobiology found that CBD could ease depression in a day. Commercial antidepressants typically take a fortnight.
CBD acts on the cannabinoid receptors in cells that alter neurotransmitter release in the human brain.
A 2017 report by the World Health Organisation (WHO) found that CBD could provide relief for a variety of debilitating conditions including Alzheimer’s disease, Parkinson’s, multiple sclerosis, cancer and diabetic complications, inflammation, and chronic pain, as well as general pain, anxiety, and depression.
There have been great results treating epilepsy and recently a study links CBD to weight loss.
Published in the journal, Molecular and Cellular Biochemistry they linked CBD to three causes of “fat browning”, which turns the dangerous white fat that is associated with obesity and diabetes turn into brown fat cells.
Brown fat cells aid weight loss by burning extra calories through thermogenesis, your body’s heat-production process.
CBD Dropshipping Products
It is legal to dropship CBD in the USA and EU, but not in Canada or Australia.
Some of the most common CBD products on the market today include sublingual tinctures, infused edibles, and topicals, like gels or creams and even bath bombs:
Different types of products available for dropshipping:
- Edibles: Edibles are a growing sector of the industry. These can include baked goods, candies, gummies, and other foods. CBD edibles have faced scrutiny from the U.S. Food and Drug Administration but are commonly found in products on the market today.
- Topicals: Topicals include gels, creams and sprays and bath bombs for aches and pains. These products are placed directly on the skin to target a localized region of the body or in the case of bath bombs to treat the whole body.
- Sublingual tinctures: A sublingual tincture is CBD oil that comes in small bottle brown bottles with a dropper inside. These are ingested by placing drops under your tongue and allowing the oil to absorb into your bloodstream.
- Vape concentrates: CBD oils and waxes that are made for vape machines are another product. These are used with a specially designed device to vaporize and inhale the CBD product.
- CBD capsules come in a gelatin capsule or softgel. Capsules are a fast and convenient way to take a dose of CBD. Capsules are quicker to use than tinctures and isolates. They are favored by customers who want to avoid edibles or just want to take CBD in a quick familiar form.
Requirements For Shipping In The USA
USPS issued new guidelines in March 2019 for sending hemp-derived CBD products through the mail.
- The shipment should be mailed with a self-signed certification statement, documentation showing your legal authorization to ship CBD products.
FedEx, UPS, and DHL rules state:
- Online merchants involved in shipping cannabidiol oil still must abide by Federal regulations and ensure their product is derived from hemp and contains less than 0.3% THC.
Rules And Laws From Companies You Might Need To Deal With
Shopify, a Canadian based company serving online retailers around the world announced on September 17, 2019, new platform features to help US merchants sell CBD products online or in brick and mortar locations where permitted by law.
In Canada, most sellers believe that CBD is a legal product because it does not cause intoxication, and don't realize that they are indeed breaking the law by selling it.
In the UK it is legal to purchase CBD via PayPal, but because Paypal is governed by US restrictions, PayPal in the UK still classifies CBD as a narcotic making it very risky for CBD companies using PayPal as a payment merchant.
There have been many reports of PayPal freezing the funds and accounts of CBD stores selling legal products in the UK. This includes all different products such as CBD vape liquids, capsules, and oil. And, unfortunately, there is no way to appeal the decision.
This means that businesses are unable to access the funds that they need in order to continue operations, and cash flow issues have led to the closure of some businesses.
This high level of risk means that PayPal cannot be considered a viable option for CBD stores.
Amazon and eBay ban the sale of CBD worldwide while the credit card processor Stripe has given CBD businesses access to credit card processing services in the USA.
As of June 26, 2019, Facebook announced it would be lifting its ban on some CBD products, meaning that advertisers can now publish ads promoting topical hemp products via the social networking platform.
Alphabet Inc.’s Google is taking steps toward ending its prohibition on advertising for cannabidiol products through a trial program that allows select companies in the budding hemp sub-industry to purchase ads on its platform, but there are some restrictions.
Advertisements for CBD can’t use the word “CBD,” for example. You need to use phrasing such as “full-spectrum hemp” on topical products instead.
Where To Find CBD Dropshipping Suppliers
While dropshipping CBD products is a very new industry, it's best to find a supplier that can help you customize your buyers shopping experience.
While we may be a little partial, we'd recommend you get started with the Dropified Private Label on Demand plan. You won't just dropship CBD, but be able to customize all your labels and build your own brand without having to worry about buying inventory or minimum orders.
Now that you know more about CBD and the laws in different countries would you be willing to work towards becoming the next CBD dropshipping success story?
Leave a comment and keep the discussion going.