Is the CBD Industry Expected to Grow? The True Value of the CBD Market
CBD products are now available at gas stations, smoke shops, health food stores, gyms, marijuana dispensaries, and countless sources online. Even with so many outlets, the demand for CBD continues to increase.
No matter how you look at it, the CBD market is expected to continue to grow in the U.S. and worldwide. Consumer demand is still taking off as CBD becomes a household staple. The 2018 Farm Bill legalized hemp and hemp products in the U.S., further giving the burgeoning CBD industry a boost in legitimacy.
This also invited many new and existing businesses to enter the market, meaning it is more important than ever for CBD brands to set themselves apart, find their consumer niche with innovative products, and offer quality products that will drive repeat business.
What is the CBD Market Worth?
According to BDS Analytics, the CBD market was worth $1.9 billion in 2018, including CBD products made with hemp and marijuana. This market is mostly driven by college-educated women with an average age of 40.
Already worth a couple billion dollars, the CBD market is likely to boom in the next 3-4 years. Different major market analysis firms predict varying growth rates for the CBD market, but all are pointing toward the CBD market approaching or breaking $20 billion in the U.S. alone in the next several years.
- Canaccord Genuity predicts U.S. CBD sales to grow to $18.4 billion by 2024.
- Arcview Market Research and BDS Analytics anticipate $20 billion in sales by 2024.
- Brightfield Group expects the market to grow to nearly $24 billion by 2023.
These reports all generally assume an average 50 percent compound growth over the next few years to reach these estimates.
“We’re witnessing CBD maturing from a cannabis sub-category into a full-blown industry of its own,” said Roy Bingham, CEO of BDS Analytics in the firm’s report. Although it is growing alongside the larger cannabis industry, CBD is more than just another cannabis product. CBD sold at dispensaries is growing at a faster rate than total dispensary sales.
The CBD market reaches well beyond dispensary sales, finding its way into edibles, beverages, skincare, and bath and body products being sold at major retailers like CVS, Kohls, and more.
What About the FDA?
With the full legalization of hemp in the U.S., regulation of the CBD industry falls largely on the FDA. As of now, the agency has been slow to roll out specific regulations, but late last year, it mailed out warning letters to 15 companies for not complying with the requirements of the Federal Food, Drug, and Cosmetic Act. The agency also expressed concerns about the unresearched effects of CBD in a consumer update. For now, the CBD industry is moving forward to fill consumer demand for CBD products.
What Happened to the Green Rush?
Even while the cannabis and CBD markets are growing, investment in the industry is slowing, as investors are looking more at sales revenue than projections and making safer investments.
Following the passing of the 2018 Farm Bill, 2019 saw a saturation of the CBD market by brands looking to secure their part of the $2 billion market, causing many of the big players to lose value and opening the door for smaller companies to gain a foothold.
This means that the CBD businesses that are ultimately going to succeed are the ones with solid plans, unique products, and the ability to remain compliant when creating and marketing their products.
How to Enter the CBD Market
Looking to get started with CBD but aren’t sure how? Nutralife Wellness Labs has the resources to help your business offer CBD products to your customers. With our CBD wholesale program, you can retail our successful CBD brand, Nutralife Wellness, on your shelves. Already have an established brand? Our proven white label CBD products make it easy to include CBD products in your line. Finally, our custom CBD manufacturing team can make your CBD product ideas a reality, so you can set your brand apart from the competition who are all selling the same few products. Come see what makes us different.
There is incredible opportunity for businesses and their brands to enter the CBD market. Visit our education page for more on topics like choosing the right CBD formulator, picking the best CBD products for your brand, and top tips for starting your CBD business.