There is no doubt cannabidiol (CBD) is enjoying exponential growth throughout Europe. While the market in America is currently 25% larger, many analysts expect the European market to grow by around 400% by 2023 to become the largest CBD trading area in the world.
There are several critical reasons for this growth, and they also support the theory that the growth trend will continue. While CBD has been legal in most European countries for many years, it is only recently that the majority of potential customers have become aware of the reported benefits of cannabidiol products.
This awareness has had a knock-on effect, which allowed the European CBD market to grow to such unprecedented heights.
Increased Consumer Awareness
Without demand, there is no need for a supply. There were exhibitions held around Europe for decades, but the attendees were mostly producers and distributors looking for new opportunities.
While this has helped to support a certain level of growth, the main reason for the recent boom is that consumers are more aware of what CBD can do for them. What they used to think of as a cannabis market is now a mainstream cannabis- and hemp-derived market which is safe. More people are realizing that CBD does not have a psychoactive effect, removing the associated social stigma.
While CBD producers and suppliers have been working to raise its profile and extol the benefits to an unaware public, other factors have also worked in their favour. Potential customers have found that mainstream medicine may not have all the answers. While a decade ago awareness was still quite limited, that is no longer the case. A natural alternative can sound appealing and may also contribute to a higher level of interest from those seeking to support their overall wellness.
Huge Profit Potential
Producers, distributors, and suppliers are aware there is potential for a significant profit in the CBD sector. Now that CBD products are starting to take hold of the public’s attention, there is an excellent opportunity for developed brands to enter the area and sell in Europe. Market analysts such as the Brightfield Group are following the rapid rise of CBD in Europe.
Brightfield Managing Director Bethany Gomez believes there are impending regulatory changes that support producers looking to expand throughout Europe. Although the European market was worth €73.5 million (US $80 million) in 2018, analysts expect it to overtake the American market in the next three years.
Investors are also watching with interest, as they have recognised the potential in a new but fast-growing industry. The production facilities required for growing industrial hemp plants, from which they extract the CBD, need significant square footage to produce the product at scale.
Well-paid scientists are needed to extract and refine the highest-grade of products possible. Laboratories must meet rigorous hygiene standards, just like any other clinical setting, and this all costs a substantial amount of money before a return is available.
So far, the appetite in the industry shows no sign of abating, and companies and investors have committed many millions of euros to set up, maintain, and grow their operations. Businesses now seek to capitalise on the recent explosion in interest and invest further in trying to generate even more public awareness. It’s a time of great opportunity for developed and new companies to join a market that is undergoing rapid expansion.
Increase in Availability
While there is a fragmented approach to the availability and distribution of CBD products, as each country has its own response, there is no doubt that CBD is more widely available in Europe than before. Aside from the proliferation of products being accessible in pharmacies and even cafes, the increase in online stores allows most consumers to have CBD delivered to their door, depending on the regulations in their home country.
A decade ago, it would have been more challenging to find reliable information and reputable suppliers, but regulations have slowly caught up with the boom in the market. Now, CBD vendors must be open and honest or risk being shut down. It is strictly forbidden to make any claim that CBD may have a medicinal benefit. While the hope one day is that this link is finally proven, companies must not mislead their customers into thinking that has already occurred.
By having regulations in place, consumers can buy with more confidence, and this, in turn, leads to an increase in sales. Trust is essential when your customers are putting a product into their bodies, and robust regulation ensures that this level of trust can grow in line with consumer purchases.
There are already excellent companies in Europe with both a product and distribution network already in place. Ordering has never been easier, and consumers may benefit from the growth that is still to come, as operations become even more efficient.
The CBD market will continue to expand through Europe as long as product quality remains high. Now is not the time for companies to skip steps to get products out the door as quickly as possible. Product availability and consumer awareness, and confidence, continue to grow at a ferocious pace.
Those that take the time to produce high-quality CBD products may find it easier to enter and expand within a market that is hungry for help with many health conditions that affect the quality of life. Research may not have found the scientific link they are searching for yet, but CBD is just starting to take hold in Europe, and many hope they find the hard evidence sooner, rather than later.