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There couldn’t be a better time to start a CBD business in the beauty sector. In 2018, experts valued the global CBD skincare market at an impressive $710m USD. However, they also predicted that the net worth would rise to a whopping $959m USD by 2024. With the industry picking up steam, we recommend getting started right away. This gives you plenty of time to establish your brand within the CBD space, cultivating a reputation as an industry expert.
Why You Should Start a CBD Business in the Beauty Sector
Before we delve into the steps needed to start a CBD business in the beauty sector, we’ll briefly take a look at why we recommend doing so. You might be curious – can CBD be used in cosmetics safely? Absolutely. In fact, infusing cosmetics, like skincare and hair care products, with CBD can hold a host of benefits for your potential customers.
Some of the Main Benefits of Using CBD in Cosmetics Include:
- Anti-inflammatory properties: Because CBD has anti-inflammatory properties, it can help soothe irritated skin. It can help reduce redness, swelling and discomfort for people who suffer from acne or inflammatory skin conditions, such as psoriasis, eczema, or dermatitis.
- Analgesic effects: CBD acts as a mild form of pain relief, helping reduce pain and discomfort in the skin, muscles, and joints.
- Curbs sebum production: Experts believe that CBD can help balance the skin’s natural oils (sebum). This can help strike a balance between oily and dry skin, helping reduce acne breakouts and inflammatory skin condition flare-ups. In addition, adding the cannabinoid to hair care products could help balance sebum production on the scalp, preventing oily hair and dandruff.
- Contains antioxidants: Antioxidants are substances that neutralize free radicals. Free radicals are potentially harmful molecules that can damage the structure of our cells, leading to premature signs of aging, hyperpigmentation, and health concerns. Antioxidants also promote cell turnover, helping reduce the appearance of blemishes and scarring.
- Antimicrobial properties: CBD can help reduce bacteria on the skin, which can cause acne breakouts.
- Restores and retains moisture: CBD helps maintain the skin’s natural moisture barrier, as it helps lock in moisture. This can reduce the appearance of fine lines and wrinkles, as well as helping prevent acne breakouts and psoriasis/eczema flare-ups, which are triggered by dehydrated skin.
- Packed with omega fatty acids: Hemp oil is loaded with omega fatty acids that nourish the skin and hair follicles. They also promote healthy circulation in the scalp, supporting hair growth.
Every day, experts explore the capabilities of the cannabinoid, and we’re constantly finding new benefits and uses for it. Therefore, there are endless opportunities for your CBD cosmetics business.
How to Start a CBD Business in the Beauty Sector
Now that we know why you should get involved in this lucrative industry, let’s talk about the steps you will need to take to start a CBD business in the beauty sector.
Research Your Market and Find a Niche
Firstly, you will need to conduct extensive market research. Once you have familiarised yourself with the types of skincare and hair care products currently available, you should have an idea of what niche you would like to get involved in.
You should strive to identify a demographic that is underserved. Perhaps you can think of an innovative product that can help solve a problem or concern? For instance, you could use CBD-infused skincare products to help people suffering from particularly sensitive skin or inflammatory skin conditions. Or, you might want to build a plant-based CBD brand that serves people who choose to follow a cruelty-free/vegan lifestyle.
When you have identified your ideal customer, your target market, you will need to learn everything you can about them. You should gain an in-depth understanding of their lifestyle choices, buying habits, personal interests, needs, wants, frustrations, and their average income. This will help you understand who you want to sell your products to, who you want to reach with your marketing.
When you understand your target market, you can choose a specific product that will serve their needs best. You can choose from a wide range of CBD-infused cosmetics:
- Face masks for specific skin concerns
- Facial oils
- Eye creams
- Body lotions
- Body washes
- Muscle balms
- Hair masks
- Hand/foot lotions
- Shaving foams/lotions
Build a Business Plan
The next step you’ll need to take to start a CBD business in the beauty sector is to build a detailed business plan. This is a document that will act as a roadmap for your business. It will outline what you’re selling, how you’re going to sell it, to whom, and where you want your business to be in the future.
You should include the findings from your market research, i.e. everything you have discovered about your target audience and competitors. Here, you should outline your product range and why you chose those specific products for your target audience. You should discuss the unique selling points (USPs) of your products and how you intend on competing with existing brands in the same niche.
Your business plan should clearly lay out your brand vision – your brand vision statement. You should also include your goals and objectives for your business, both long-term and short-term. This is especially important if you are hoping to gain financial backing from investors, as they will want to know what the future looks like for your business. We recommend including any potential pitfalls and solutions for them, to show that you have considered every outcome and you’re adequately prepared.
A business plan would not be complete without financial planning. To calculate a realistic budget, you will need to predict how much capital you will need to start a CBD business in the beauty sector. To do this, you will need to look into what tasks you can manage in-house and what you will need to outsource – outsourcing can be more expensive. In addition, we recommend budgeting for unexpected expenses. You never know when you may need to go over budget, or you may be faced with unforeseen costs.
Decide on a Name, Register it, and Buy a Domain
The next step you will need to take to start a CBD business in the beauty sector is to decide on a brand name. We suggest coming up with a name that is original and easy to remember. Whether you’re selling online or offline, you will need a social media presence and a website. Therefore, we suggest making sure the name is easy to spell.
When you have settled on a name that reflects your brand vision, you can purchase a domain name and claim social media accounts. We recommend sticking to .com and .co.uk for your domain name, they seem more trustworthy to customers. Make sure your social media handles match your chosen domain name to avoid confusion.
We recommend registering your business name as soon as possible, as you will need business and tax information to hand when you are ready to place an order with your supplier. Additionally, you will need this information to set up a merchant account (a business bank account) so that you can receive funds from your customers when they place an order.
Research Regulations Before You Start a CBD Business in the Beauty Sector
The CBD industry is constantly growing and evolving, therefore you will need to make sure you stay on top of your research if you wish to start a CBD business in the beauty sector. For instance, you will need to make sure you’re familiar with current restrictions and regulations.
Some of the Main Restrictions You Should Be Aware of Include:
- THC limitations: Finished CBD products cannot contain more than 1 mg THC, and all CBD extracts must be sourced from certified industry hemp plants, containing no more than 0.2% THC.
- Advertising restrictions: When marketing your products, you need to be careful not to make any unsubstantiated or medical claims. This means that you cannot imply your products will cure, treat, or prevent medical conditions or illnesses. For instance, eczema and psoriasis are medical conditions without a cure. While CBD can help alleviate symptoms of these conditions, it cannot cure them.
- Notifying the European Commission of new products: For each new cosmetic product launched, you must submit a notification to the European Commission via the Cosmetic Product Notification Portal (CPNP).
- Certificate of Analysis: Whilst not a legal requirement, we recommend obtaining COAs for your products and granting your customers access to them. These are third-party lab reports that will show potential customers, and you, the cannabinoid profile and potency of each of your products. This shows trustworthiness and transparency as a company.
You will also need to familiarise yourself with the regulations and restrictions in place for all cosmetics in the UK. You can find more information about this, as well as labelling requirements, on the Cosmetic, Toiletry and Perfumery Association (CTPA) website.
If you’re unsure about COAs, legal requirements, or Cosmetics Portal submissions, our Cannmed team are more than happy to help you. Simply fill out the form and our team will be in touch.
Find a Reputable Supplier
If you have access to manufacturing facilities, you can keep costs down by opting for wholesale CBD products and making your own line of products yourself
However, if you’re wondering “how do I start a CBD beauty line without manufacturing facilities?”, we have that covered too. You can simply opt for a white label CBD service. This is a service where a supplier will use tried and tested formulations to manufacture your products to your specifications. In addition, if you don’t have access to labelling or packaging facilities, you can opt for a private label service where the supplier takes care of this too.
Whether you’re opting for our white-label or wholesale products, you can rest assured that each have been carefully produced and thoroughly tested. Each product is accompanied by a COA, which you can use for your own business, and seed-to-sale traceability. You can view our accreditations here.
Build an E-commerce Store
When you have ordered your products, it’s time to get your e-commerce site up and running to start a CBD business in the beauty sector. You should make sure your site is easy to use and your customers can easily find their way around.
When writing your product pages, you should include the most important information in bullet points or bite-sized chunks, so that customers know what the product is and how to use it at a glance. However, not all of your customers will be CBD or skincare connoisseurs, so we recommend catering to all experience levels. You can include sections with more in-depth information about your products, trying to answer any potential questions that customers may have.
We recommend including a page on your site which states your delivery, payment, and returns policies. On this page, you can clearly explain the costs of shipping, the timeframes for delivery, and in what circumstances customers are entitled to a refund or replacement.
You will also need to find a payment processor to handle transactions, i.e. moving funds from the customer’s bank account to your merchant account. In addition, your provider should have anti-fraud and security measures in place. Unfortunately, not every payment processor is available to CBD businesses at the moment.
Learn more about: CBD Payment Processors
If you want to start a CBD business in the beauty sector, we suggest conducting in-depth market search in the very beginning. This is because it will influence almost every aspect of your business – including your marketing and branding. Knowing your audience will save your time and money when it comes to advertising, as you will know where potential customers like to spend time on the internet. This will allow you to share information about your products in the exact place where they will them.
There are many types of advertising when it comes to selling CBD and which route you take will largely depend on your target market. Some of the most popular ways of marketing CBD products are:
- Social media marketing
- Content marketing and Search Engine Optimisation (SEO)
- Search Engine Marketing (SEM) i.e. Pay Per Click (PPC)
- Email marketing
Coming up with a flexible marketing strategy will help you build brand awareness and visibility. Essentially, it will help customers find your products, and it will help build your reputation as a trustworthy retailer.
Are You Ready to Start a CBD Business in the Beauty Sector?
There couldn’t be a better time to start a CBD business in the beauty sector. The beauty industry is growing every single year, and with a newfound emphasis on plant-based and natural products, it’s CBD’s time to shine. CBD is a plant extract that can have many benefits, whether it is infused in skincare or hair care products. As we learn more about the cannabinoid as time goes on, there is plenty of room for innovation and improvement within the industry too.
Ready to get started? Simply fill in this form with your details, and our dedicated team will contact you as soon as possible. We can help with everything from branding to packaging, from marketing to production. We look forward to hearing from you!
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