By Alex Mardikian
CBD oil or hemp oil is a hot-selling product. The rate at which sales of CBD oils, cookies, and other hemp-based products are growing indicates that the market for these products is expanding at a fast rate. People are buying hemp oil and THC-infused foodstuffs for medicinal and recreational purposes.
CBD oil fetches handsome profits. It is a high-risk product because of the legal status in many states. There’s huge demand for it. One of the chief concerns with high-risk businesses is finding a secure payment gateway and then maintaining their merchant account with the gateway. Cases where CBD oil vendors find their credit card blocked and bank account restricted are not uncommon.
The first thing to do is to apply for a merchant account with a payment gateway that has the expertise in handling high risk businesses such as multi-level marketing, CBD oils, casino software, nutrition supplements, etc. You’ll have to do some searching because most of the well-known ones steer clear of such high-risk ventures.
One way of landing a secure account with a good financial services provider is to use the services of a broker. It is folly to run a high-risk business with the known payment gateways because the sword of an unexpected account termination always hangs above your business.
Such brokers can refer you to pre-vetted and trusted merchant account providers. With brokers in the picture, you can expect a smoother application process, lower application fees, and a proper underwriting process. If you wish to set up an online CBD oil shop and run the same on e-commerce platforms that enable smooth integration with payment gateways best suited for your business given the high risks associated with it.
Brokers do more than just match you with a good payment processor. Many brokers offer attractive additional services such as helping your business with SEO so that it ranks organically, and your ad spend is reduced. You will learn valuable information about prevalent risks, existing regulations, proposed changes, and steps you can take to stay prepared.
Brokers can also expose you to new business ideas aligned with the existing CBD oil business. For example, you can branch off into stocking and selling vaping oils and smokes.
Consider the following before setting up a CBD online store –
- Sole proprietorship and use of social security number is not a good idea. This is a high-risk business and there is always a chance that you will lose what you put into it. An LLC is the best alternative.
- Insure the business. It’s a high-risk business and you don’t want to cop losses unnecessarily. Get the CBD oils business insured with an insurer that knows the risks specific to this business given the state where you’re based, existing regulations, historic data, and other factors. Inszone Insurance covers your business from costs associated with unexpected losses, lawsuits, and contingencies peculiar to a high-risk business.
- Register the business. You need to furnish a tax ID / EIN from the IRS before a bank and financial service provider such as a payment gateway approves your business.
- You need a good online store. You’re in a high-risk business. Banks, credit card processors, payment gateways, and your customers know it. You have to do all that you can to create a good first impression. For this, you need a shopping cart that accepts CBD oil and hemp products. Since the shopping cart, payment gateway, and credit card processor work in tandem, rejection from any one will result in a shutdown for your business.
- Choose CBD products wisely. You can sell high-profit items. Indeed, you will make high profits because the risks are high. But the products must be genuinely useful to the consumer. Select the right CBD oil wholesalers to work with.