Marijuana Business Magazine September 2018

“It’s kind of the Wild West right now, everybody trying to find their little niche in this market.There’s a lot more CBD coming in, and no one knows where it’s all going to go.” CBD prices already have fallen sig- nificantly from the $250 per gram that tempted Jarboe to enter the market in Tennessee. As more companies compete in the CBD market, prices are going to keep falling. CBD producers also are keeping a nervous eye on Canada, which grew 10 times as much hemp last year as the United States. Canadian hemp growers had been banned from using hemp flowers for CBD extraction. But Canada’s new marijuana law, which takes effect Oct. 17, ends that prohibition, unleashing a wave of Canadian CBD that will be legal to export to other countries. “The game has changed with can- nabinoids coming into this market,” said Russ Crawford, head of the Canadian Hemp Trade Alliance. “It’s about supply and demand. As we produce more CBD in Canada, prices are going to go down globally.” CBD entrepreneurs are gambling that consumer interest will grow as quickly as CBD production, keeping the CBD sector profitable for years to come. “I don’t think we’re anywhere close to the peak for CBD,” said Blake Schroeder, CEO of Kannaway, a San Diego CBD producer and subsidiary of Medical Marijuana Inc. “I can envision a time where we have a recommended daily allowance for CBD, just like we do with vitamin C. Our mission is to educate the world and bring CBD into the mainstream.” Back in Colorado, the Sharmas aren’t worried that the CBD market is overheated. “We get asked all the time, ‘Should I enter this space?’” Priyanka Sharma said. “I would say a resounding yes.There is still time.” ◆ NEW FRONTIERS FOR RETAIL C annabis in Kansas City, Kan- sas? Sure, if it’s CBD. CBD is creating oppor- tunities for entrepreneurs to enter the cannabis space in states where marijuana isn’t legal. Vince Sanders of Kansas City is one of them. He started mak- ing homemade hemp extracts from hemp growing wild in Kansas ditches in 2012 to help an uncle dying of lung cancer. Three years later, Sanders started a CBD business using isolate imported from Europe. Today, his chain of CBD retail franchises, CBD American Shaman, has more than 40 locations in six states. The shops are all in states without legal medical marijuana, such as Georgia, Missouri and Texas. CBD American Shaman stores carry roughly 120 stock-keeping units (SKUs) of their own CBD products, from tinctures and topicals to gum- mies and vaporizers, all manufactured in Kansas using imported European isolate. The company’s success helped inspire Kansas lawmakers to over- whelmingly approve hemp production in 2018. Sanders said that CBD retailing requires a different approach than marijuana retailing. “It’s like a liquor store compared to a pharmacy in some ways,” Sanders said. “One is much more about psychoactivity, and the other is purely medical-driven.” And unlike marijuana retailing, where zoning restrictions dictate location selection, CBD retailers can use the same market analysis employed by traditional retailers to find the best locations. “As long as the income level isn’t too low in a market, this thrives anywhere,” Sanders said. – Kristen Nichols Vince Sanders ON THE CAP¬TAL¬Z¬NG CBD SURGE CBD American Shaman operates more than 40 retail locations, including this one in Overland Park, Kansas. Photo courtesy of Shaman Botanicals 64 • Marijuana Business Magazine • September 2018