Private-labeling CBD products involves rebranding & reselling the product made by the origin company(provider). This allows retailers to skip a step in the production chain and bring a product to market in an efficient and effective manner.
In this quick guide you’ll learn how you can effectively private-label CBD products in a timely and organized fashion.
How Does This Work?
The art of private-labeling is simple. A manufacturer makes the products to then be resold to consumers under the brands (buyers) name. This can be especially convenient for retailers with an established brand or customer base looking to expand their product line, but doesnt have the “in-house” capabilities.
Commonly Asked Questions:
Q: Do I provide the bottles/jars?
A: Traditionally, private-labeling is a full-circle experience where you do not need to provide packaging for the product; however, in some cases, if there is a specific bottle/jar desired that the provider does not stock, then you would have to provide your own bottles/jars to the manufacturer.
Q: What about labels?
A: Private-labeling with labels as a complete product, or without labels as a packaged product is a case by case scenario in which you would need to identify if the provider prints custom labels to your rebranded liking.
Scenarios
See a list of scenarios for private-labeling CBD products below:
Private-label CBD for DTC (Direct to consumer)
- Company X, a CBD product manufacturer, sells their CBD product to company Y, a brand, to resell
- Company Y sells the CBD product rebranded to their customers
Private-label CBD for Distribution
- Company X, a CBD product manufacturer, sells their CBD product to company Y, a distributor, to resell
- Company Y sells Company X’s product to retailers rebranded OR private-labeled
Why Would I Private-label CBD Products?
Private-labeling comes in handy for brands in many ways. This section will cover the top three reasons brands choose to private-label CBD products.
Manufacturing CBD products in the USA requires certifications & testing
If the company private-labeling does not already produce CBD products, most will look to private-label the products they bring to market rebranded as their own.
Formulating safe and effective combinations of CBD and terpenes requires knowledge and experience
When it comes to producing the actual product, companies will choose to outsource the production in order to comply with regulations and create a product that works best for consumers.
You want to be seen as a competitor
Let's face it. No industry has an easy entry point. It comes down to building a great product that people love. This often requires the help of experts in designing a product that aligns perfectly with the brand that is private-labeling. When you private-label a CBD product, you can expand your current line or start a new one!
How Do I Start Private-labeling CBD Products?
In this section we cover the step-by-step process for companies looking to private-label their own collection of CBD products.
Step One
Select Product
Step one consists of brainstorming and choosing which product or collection you want to private-label. Depending on the manufacturer you should have options such as tinctures, creams, gummies, capsules, powders, etc.
Step Two
Select Strength
Once you’ve determined which product to move forward with, you’re going to select the strength you’ll make available to consumers. It varies among manufacturers whether you can do custom amounts or stock amounts in each product.
Step Three
Select Flavor/Scent
After you have come up with a product, and chosen it’s strength, you would pick what flavors or scents you will offer in the collection. Certain manufacturers offer custom formulation for specific flavors or scents on a case by case basis.
Pro’s & Con’s Of Private-labeling CBD Products
Let’s get into the pro’s and con’s of private-labeling CBD products with a section to help you determine if this will fit in properly with your business model.
Dessert first…
Pro’s
- Private-labeling makes it easy to brand
- Manufacturers are constantly innovating and updating products
- Differentiate & surpass competition
- Niche down and target a specific sub-audience
- More cost efficient
- Added value for clients/customers
- Partner with the best
- Decrease risk of launching new product
- Lower the barrier of entry
Time for the Veggies…
Cons
- Determining mark-up (unless your private-label partner recommends retail prices)
- Customers will associate any weakness in the product with you
- Communication and support are a vital factor (if your private-label partner doesnt have you set up with a personalized account manager to ensure a smooth transition to market you may run into some roadblocks down the line)
The Bottom Line
There are many companies out there who will offer private-label CBD products. The key is finding a company that will offer you a fast and complete service at a competitive rate. There a a few things to look for in a company. This section will give you a bottom line when it comes to choosing a CBD product manufacturer.
Things to look for
Custom formulation
If you have your own idea for the type, flavor, or scent of your product look for a manufacturer who offers custom formulation on manufacturing contracts.
Good communication
Communication is key. Partner with a company that will make this process easy, not a headache.
Brand identity & consistency
When you work with an established and experienced CBD manufacturer you’ll get nothing but the best. To avoid putting your brands reputation on the line, avoid using a company that lacks a basic process to private-labeling CBD products.
Final Thoughts
Private-labeling CBD products doesn’t have to be a nightmare; in fact, it can add a lot of value to the lives of a lot of people when done properly. Working with a well oiled machine beats a rusty one. Choose carefully who you decide to work with when it comes to CBD, if you choose right, you’ll grow your business in a fast and efficient way. Learn more about our 4-step private-label system when you visit our build-a-product suite.
-The Wholesale Hemp Suppliers Team