Shopify offers a great platform to sell your products. You can sell your own homemade products or dropship. With the CBD industry buzzing, lots of physical and online shops are opening up. Shopify is an available marketplace option for CBD, but it does have some tricky fine print you need to understand if you use it.
Unless you’re planning to sell homemade CBD products, you’ll probably use the dropship option. Dropshipping is a method where you work with a wholesaler or supplier rather than carry the products yourself. When your store is set up this way, the third-party supplier handles the inventory and ships it directly to the customer. This takes away the costs of stocking your store beforehand and avoids hoarding leftover unpopular items in your closet. It lets you start your own business without such daunting overhead costs or arduous shipping and handling matters.
Here are some tips for dropshipping CBD products:
1. Know your local CBD regulations.
Rules about CBD from hemp vary from state to state and sometimes per city. Make sure you are crystal clear on what your state does or doesn’t allow you to sell. Even though it is an online store, you cannot sell products that are illegal in your state. Consider consulting a local lawyer if you aren’t sure about it.
2. Understand the additional application process for CBD products.
You will have to fill out a form, “Attestation for the Sale of Hemp and Hemp-Derived Products,” and apply for a third-party payment gateway. It’s a little more involved than most products because of the constantly changing regulations. When reviewing your application, they consider factors such as product type, age of the business, transaction history, volume, product variety, accurate representation of the effects as approved by the FDA, etc.
3. Anticipate transaction fees and extra shipping costs.
Shopify typically offers a Shopify Payments subscription that eliminates transaction fees. Unfortunately, CBD products are not covered by that and much endure them. To collect money, you can work with a third-party payment provider such as DigiPay or eMerchant Brokers.
Because you’ll likely be working with suppliers in multiple locations, shipping costs can add up. If a customer purchases multiple items that all happen to be at different locations, they won’t be happy paying three or more shipping charges. To provide excellent service, you may have to absorb that cost occasionally. This isn’t detrimental to your store’s success, but don’t be surprised when it happens.
4. Find your niche.
While the lower initial investment of a Shopify store is great, that applies to everybody else too. Competition gets harder when everybody starts selling the same products. Think about what makes you different and expand on that. As you develop your niche, select products that make you unique. That coupled with stellar customer service will make your store stand out.
5. On that note, provide stellar customer service.
Be ready with your biggest smile to deal with inevitable situations such as supplier errors and product dissatisfaction. Even the best suppliers slip once in a while but it’s still under your name. While you determine your threshold of “the customer is always right,” it is important to leave good impressions and encourage them to return to your store despite the mistake.
CBD stores come with some extra challenges but that doesn’t mean they aren’t totally doable. Use these tips to help you build that thriving CBD business you’ve always wanted!