How to Get Started With CBD Dropshipping (2024 Guide)

In recent years, CBD products have become increasingly popular.

Dropshipping CBD products can be a great way to build an online business, as it requires no upfront inventory costs.

This guide will provide an overview of what is needed to start CBD dropshipping.

Let's dive in!

What is CBD dropshipping?

CBD dropshipping is a process of selling products containing hemp-derived cannabidiol through an online store without holding inventory.

If you want to start this unusual business model, there is one thing that you need to be aware of - legality. You should understand the laws in your area and ensure you comply with them.

In fact, the main difference between CBD dropshipping and regular dropshipping is that CBD dropshipping may have some legal restrictions due to government regulations around hemp products.

What are the pros and cons of CBD dropshipping

Like any business, there are always pros and cons.

Let's take a look at some of the pros and cons of CBD dropshipping:

Pros

• Low startup costs. CBD dropshipping allows you to start a business with minimal upfront costs, as you don't have to purchase inventory upfront.
• A broad customer base. CBD products can relieve pain, reduce anxiety, improve sleep, and more!
• Wide selection of products. With dropshipping, you can access various CBD products from different suppliers.
• Scalability. As your business grows, you can easily scale up your operations by adding new products or suppliers.

Cons

• Lower profit margins. Since you're not buying products in bulk, you may have to pay higher prices for individual products, affecting your profit margins.
• Risky items. Since hemp products may be illegal in some countries, there is always a risk that your business could be shut down if you're found to be operating illegally.
• Payment processors. They may see it as a high-risk business model; therefore, your business could not get approved for payment processing services.

Do you need a license to start dropshipping CBD products?

To start dropshipping CBD products, you need to obtain the appropriate licenses and permits.

The legality of CBD products varies from state to state, so you need to research the laws and regulations in your area before starting your business.

Here are some of the licenses and permits you might need to get:

• Business license. You may need a general business license to operate any type of business in the United States.
• Sales tax permit. You need a sales tax permit if you plan to sell CBD products in a state that requires sales tax.
• Hemp handler's license. If you plan to sell hemp-derived CBD products, you must obtain a hemp handler's license from your state's Department of Agriculture.
• CBD-specific license. Some states require a specific license to sell CBD products.

The regulations surrounding CBD products are constantly changing, so it's essential to stay up-to-date on your area's latest laws and regulations.

How do you start a CBD dropshipping business?

When starting a CBD dropshipping business, the first step is to find a reputable supplier who can provide high-quality products.

Don't worry; we will provide some suppliers in this article that are worth checking out.

However, we still recommend doing a thorough research and checking for certifications and third-party lab test results to ensure the products meet legal requirements and are safe for consumption.

So, here's how you can start selling CBD products in ten steps:

1. Research and understand the CBD market.
2. Determine the types of CBD products you want to sell.
3. Find a reliable CBD dropshipping supplier or manufacturer.
4. Obtain the necessary licenses and permits to sell CBD products.
5. Develop a business plan and marketing strategy.
6. Create a website or online store to sell your products.
7. Set up payment processing.
8. Develop a customer service plan.
9. Launch your business and start promoting your products.
10. Monitor and analyze your sales data.

We suggest using a user-friendly ecommerce platform like Shopify or WooCommerce to build your store.

But how do you actually sell hemp products? After all, it is a particular audience that you need to target.

You'll need to develop a marketing strategy to attract customers to your store. This can include social media advertising, email campaigns, influencer partnerships, and search engine optimization (SEO) tactics.

When a customer places an order on your website, you'll purchase the product from your supplier at a wholesale price and have it shipped directly to the customer; if you already have some experience in dropshipping, you know what we're talking about!

Starting a CBD business may not be as easy as starting a regular dropshipping one, but there are still several steps that you need to take: Choosing a platform and finding reliable suppliers.

1. Choosing a platform

The first thing you need to do is choose a platform to host your online store.

As we mentioned, there are many options, but the most popular are Shopify and WooCommerce.

Each platform has its strengths and weaknesses, so it's important to research and choose the one that best suits your needs.

Some things to consider when making your decision include:

• Ease of use
• Customizability
• Pricing
• Available features and integrations

For this article, let's take WooCommerce; it has a wide range of features and integrations and is easy to customize and set up.

WooCommerce has an excellent guide for CBD products, and you can read up on the legalities of selling CBD products in the US.

2. Choosing a payment processor

When setting up payment processing for your CBD dropshipping business, there are a few things to consider.

First and foremost, you must ensure that the payment gateway you choose accepts CBD products. Many mainstream payment processors do not allow CBD sales due to the legal gray area surrounding the industry.

You can sell CBD products using WooCommerce; however, you'll need to use third-party payment processors, such as Square or Viva Wallet.

Here's an interesting quote from WooCommerce stating that you can only use Square with your CBD business if you operate from the US:

Square’s program is currently only available in the United States. If you’re operating a store outside the U.S., you’re still welcome to use the open-source WooCommerce software, but we cannot host your website at WordPress.com or on Pressable.

WooCommerce's team

So, there are a lot of 'conditions' that you need to be aware of before selling CBD products.

If you are based in the EU and want to sell CBD products through a WordPress store using WooCommerce, you can use Viva Wallet as a payment provider.

They have a program that reviews stores that sells CBD products within the EU laws and regulations.

Currently, WooCommerce payment processors do not accept CBD sellers.

Setting up payment processing

Once you've found a payment processor that allows CBD sales, you must integrate it with your website or ecommerce platform.

This typically involves installing a plugin or extension that connects your website to the payment gateway.

Let's assume you're based in the US and want to start selling CBD products.

Since the payment processor options are limited, you will likely have to use Square.

With Square payments, you can integrate your ecommerce platform via their third-party plugins:

All you have to do is sign up for the platform and follow the wizard.

Click on the 'Third-Party App Integrations' and then choose the ecommerce application, which in our case, will be WooCommerce.

Once you've done that, you will need to follow the prompts to add the payment gateway to your website.

So let's jump into it!

Create an account

First, once you've signed up for Square, you'll need to choose the type of merchant you are; since you're building a business, let's choose a Limited Liability Company (LLC).

The other few steps are self-explanatory; therefore, we don't want to waste your time - just make sure you have all the necessary information and documents on hand.

Next, you need to know where you'll be selling your products.

Since we're talking about dropshipping, you need to choose 'through an online ordering page.'

The follow-up options are all up to you. They are not mandatory to start selling CBD, so for the purpose of this guide, we'll skip them. If you want to ignore them, choose 'I don’t need any of these features for now.'

Done? Great! Let's continue.

Next, to install Square on your website, you need to have WooCommerce; here's an awesome guide that will help you get started.

Once you have installed WooCommerce, you can finally upload the Square plugin, which you can download from here:

Once you've downloaded the plugin, you'll need to upload it on your site; that is very simple.

Done? Brilliant! Now, a few more steps, and we're almost finished.

Once you've installed WooCommerce and Square, scroll down the WooCommerce plugin settings options, then connect your Square account with WooCommerce.

Lastly, you'll need to sync your product data; in this case, you will need to decide if you want to have it in Square or WooCommerce.

In most use cases, you would go for WooCommerce because you could have multiple payment options; however, since we're talking about CBD products, stick with Square to avoid running into any trouble down the line.

So to finish the setup, where it says 'product system of record,' choose Square as inventory.

Fees

It's also essential to consider the fees associated with payment processing.

Most payment processors charge a transaction fee for each sale and a monthly or annual fee for using their service.

Square offers a flat fee for online transactions and for in-person payments; for US customers, they charge 2.6% + 10 cents for in-person transactions, while online transactions will cost 2.9% + 30 cents.

3. Finding reliable suppliers

The next step is finding reliable suppliers who can provide you with high-quality CBD products to sell.

This is crucial to the success of your business, as customers will expect top-notch products and services.

When looking for suppliers, there are a few things to keep in mind:

• Quality. Look for suppliers who offer high-quality products tested for purity and potency.
• Reliability. Make sure your suppliers are dependable and can deliver products on time.
• Pricing. Compare prices from different suppliers to ensure you're getting a good deal.
• FDA. Are the statements of the supplier been approved by Food and Drug Administration? If not, you'll need to mention it on your site.

Some popular CBD dropshipping suppliers include:

• Absolute Nature CBD
• Smoke Drop
• US Hemp Wholesale
• Charlotte's web

Evaluating popular CBD dropshipping suppliers

Since CBD is a new and fast-growing industry, it can be difficult to find suppliers that offer high-quality products at affordable prices.

That’s why researching the main suppliers in the dropshipping market is essential before you start selling.

SmokeDrop is a great option for those looking for premium CBD products; their inventory includes the following:

• Pam and nose balm
• Disposable vape pens
• Pets hemp oil 
• Tinctures

What's nice about them is that they give you access to their database of Facebook-approved CBD Ad examples.

This is a huge advantage due to the sensitive nature of the product. They also offer lab reports, which is nice if you want to increase the chance of gaining your customer's trust.

There is one more supplier that you must absolutely know! That is Charlotte's Web.

They did a great job at building a 'benefit' category specifically aimed at helping people with different needs, such as sleep or calming remedies.

The website looks very trustworthy; you can find what you need immediately since it highlights all the main categories on the homepage.

As a last note, they have a live chat, so any questions you may have will be answered quickly.

4. Marketing your CBD dropshipping business

Marketing your CBD dropshipping business can be tricky, as you need to be sure that you operate within the regulations.

Understanding the CBD industry

Before we dive into marketing your CBD dropshipping business, it's important to understand the CBD industry well.

CBD, or cannabidiol, is a non-psychoactive compound found in the cannabis plant.

It's known for its therapeutic properties and is used to treat various conditions, such as anxiety, pain, and inflammation.

The CBD industry is still relatively new and constantly evolving.

Some important things to keep in mind include:

• The legal status of CBD in your region.
• Different types of CBD products are available.
• The benefits and uses of CBD.
• The target audience for your products.

Developing a marketing strategy

If you plan to market your CBD products, a few tips specific to the industry can help you increase sales and reach your target audience.

One of the most important things to consider is educating your audience about the benefits of CBD, as many people may still be unfamiliar with its uses and effects.

You can market your products by highlighting how they can solve a particular problem and explaining why CBD might be the solution.

Also, there are plenty of influencers that you can use to promote your products, as this can help you gain credibility and reach a wider audience.

To find Instagram influencers to help market your CBD products, you can follow these steps:

1. Use relevant hashtags. Search for hashtags related to CBD, such as #CBD, #CBDoil, #CBDhealth, #CBDproducts, or #CBDcommunity. This can help you find influencers who are already talking about CBD and have a following that is interested in the topic.
2. Look for popular accounts. Search for accounts that have a large following and engagement rates. You can use tools like Hootsuite or Buzzsumo to find popular accounts relevant to your industry.
3. Check engagement rates. Look at the influencer's engagement rates to ensure that their followers are actively engaging with their content. You can use tools like Social Blade or Phlanx to check engagement rates.
4. Review their content. Check the influencer's content to ensure it aligns with your brand and messaging. Look for influencers who create high-quality content with a style that matches your brand.
5. Reach out to them. Once you've identified potential influencers, contact them directly or by email. Be sure to introduce yourself and explain why you think they would be a good fit for your CBD products. You can also offer them free products in exchange for a review or post about your products.

That is, in a nutshell, keep in mind that finding influencers may be time-consuming, so we've created a full guide that goes more in detail here. Bear in mind to specifically ask them if they are willing to promote CBD products.

Another great example is Billo; if you are not familiar with this company, well, you've missed out on a lot of stuff!

They have a huge selection of content creators who will make video products for you that can show a real-life example of the product being used! Awesome no?

So, the way it works is simple. You ship the product you want the creator to promote, and they will take care of the rest by creating stunning content. Then you can use this video for your marketing efforts through various platforms.

We recommend you learn more about our marketing strategies here.

Advertising your CBD products

Now that you have a marketing strategy, it's time to start advertising your CBD products. Here are some tips to help you get started:

• Use high-quality images and videos to showcase your products.
• Highlight the benefits and uses of your products.
• Use social media to connect with your target audience and build a following.
• Consider partnering with influencers to promote your products.
• Focus on niche markets (since CBD is quite competitive, you can focus on a sub-niche like CBD for pets or CBD for athletes.
• Offer free samples (since new visitors might be hesitant to try CBD).

If you are just getting started, we assume you don't have that many resources to invest in advertising.

This is why we recommend focusing on content marketing first. Content marketing is a great way to get organic traffic on your website and help you build credibility in the industry.

You can post informative blog articles, create social media campaigns and be active in relevant forums and communities.

Tip: Looking for an all-in-one article about everything you should know about dropshipping? If so, check out our dropshipping guide!

Navigating CBD dropshipping regulations

When it comes to dropshipping CBD products, navigating the regulations can be a bit tricky.

However, it's crucial to do so to ensure compliance and avoid any legal issues.

Here are some tips to help you navigate the regulations:

1. Know the laws in your state. CBD laws vary from state to state. Some states have legalized CBD, while others have not.
2. Check the legality of the CBD products you're selling. Not all CBD products are legal. It's essential to make sure that the products you're dropshipping are legal in the state where you're selling them. Also, you'll want to ensure that the products are derived from hemp, not marijuana, as marijuana is still illegal under federal law.
3. Understand FDA regulations. The FDA has not yet approved CBD for use in food and beverages, so it's essential to be aware of the regulations surrounding the sale of CBD-infused products.
4. Use reputable suppliers. When dropshipping CBD products, it's important to use reputable suppliers who can provide you with the necessary documentation to ensure compliance. Look for suppliers who can provide you with lab reports and certificates of analysis to verify the potency and purity of the products.

Note: The FDA has issued warning letters to companies making false claims about the health benefits of CBD. Make sure that the products you're selling comply with FDA regulations.

If you're not sure whether you're country and local laws allow you to advertise and sell CBD products, it is best to consult an attorney who can provide legal advice.

That said, in the meantime, you can check out this site that will give you a glance at where it is legal and where it is not.

Are you allowed to sell CBD on Shopify?

Since you are building a business around CBD products, it's crucial to understand that Shopify's terms of service prohibit the sale of certain products, including CBD. However, there are some exceptions to this rule.

While Shopify does not allow the sale of CBD products (through Shopify Payment) that contain THC, they do allow the sale of CBD products that are derived from hemp and contain less than 0.3% THC using their third-party services, just like Square.

This means that if you're looking to sell CBD products on Shopify, you'll need to ensure that your products meet these criteria.

Also, to sell CBD products on Shopify, you'll need to provide proof that your products are derived from hemp and contain less than 0.3% THC.

This can be done by providing lab reports and other documentation verifying your products' quality and purity.

Summary

Before we go to the final verdict, we've created a quick summary of this article for you, so you can easily remember it:

• Before building your business around CBD, ensure your country allow you to sell hemp products.
• If you plan to build a CBD dropshipping website, consider using Shopify or WooCommerce as your website builder.
• Do due diligence when choosing a CBD supplier; check out those shared in the article.
• Have live chat support to provide outstanding customer service.

Final thoughts

There you have it!

We hope this guide has helped get you started with CBD dropshipping. Remember, there are many factors to consider when starting any business, and CBD is no exception.

Happy selling!

Want to learn more about dropshipping?

Ready to move your dropshipping store to the next level? Check out the articles below:

• 12 Amazing Tips to Increase Dropshipping Sales in 2024
• What Is Branded Dropshipping and How Do You Start? (6 Tips)
• How Do You Create an Ecommerce Customer Journey Map? (2024)

Plus, don’t forget to check out our in-depth guide on how to start dropshipping here!