‘Rocky time’ for CBD industry leads to casualties in ‘good brands’

By Nikki Hancocks

- Last updated on GMT

‘Rocky time’ for CBD industry leads to casualties in ‘good brands’

Related tags Cbd Novel foods

An elite-athlete turned CBD supplement brand founder has described the ‘rocky’ road travelled in this fast-evolving market but says he ultimately looks forward to an ‘extremely exciting’ future.

Dom Day, co-founder of FourFive, a four-year-young UK-based supplements brand selling a number of CBD products, says the company has worked to diversify its range in the face of market uncertainty but he expects great opportunities once they have weathered the novel foods storm.  

The brand's product selection now includes CBD oils, gummies, capsules, sprays, creams and balms, with non-CBD products including vitamin C, a 'daily biotic', vitamin D3, and omega-3 oil.

In an interview for NutraIngredients' special edition newsletter on CBD, Day provided his brand perspective of this market.

How has the brand adapted to the changing market since launch?

As a company we want to be seen as a wellness company and we are selling many ingredients and products that we have used throughout our careers. 

CBD has clearly been through a rocky time with Novel Foods and that unfortunately has seen many casualties in good brands and companies not being able to weather the storm, but we believe having a regulated market is key for the future to gain consumer and retailer confidence.

As a company we have diversified our offering which means we are not wholly reliant on our CBD offering but we are hugely optimistic for the market going forward.

What geographical markets are you selling into now?

We are selling in UK and South Africa at the moment and have our eye on other European markets. The UK is definitely a focus for us in 2023 as we are still seeing strong growth as a business and we are keen to make the most of that before expanding.

What are your most popular products and why do you think that is?

On the CBD side, any product that is combined with other more well-known ingredients. For example our CBD capsules are combined with inulin and we have a CBD Oil combined with vitamin D.

We also have a range of CBD products that are tested for banned substances for anyone that may be drug tested, these do particularly well as I think in the hangover of the last couple of years where anyone could get into the market with some potentially unsafe products, people are still seeking products that are safe and tested product to give them confidence.

What are the demographics of your key consumers? What health aims are they looking to achieve?

We see a lot of customers who are looking to alleviate general aches and pains so they can go about their everyday business, up to professional athletes who want that extra 1% in performance that quality nutrition can offer.

It ties in to our story and how we got into the health and wellness industry, we wanted products and ingredients to help us perform on the field. We did see a lot of feedback during Covid of people who were using our products for anxiety, but generally it's those looking to live a happy, healthy and active life.

What different channels of sales do you use? Which is the strongest and how has this changed over time?

We have strong B2B sales in the likes of Boots, Tesco and Holland & Barrett and this was a focus for us in the first three years.

It certainly wasn’t the easiest way to do things and comes with a lot of complexities of supply chain and fulfilment and saw us spread thin at times, but we are really happy with the relationships we have built.

We definitely have growth to be seen D2C and it will become more of a focus, but with a relatively small team it just hasn’t been something we have been able to delegate a lot resource too. 

Tell me about the process of creating your novel foods dossier and the amount of resources that went into it?

We worked closely with our manufacturers on this front as well as some consultants. We jumped on it as soon as the FSA announced it was happening as we didn’t want to waste time and we believe that a regulated market is the way to go.

Now whether they have regulated it correctly I am not 100% sure, but we are where we are and we have to play by the rules if we want to be in the market.

It has seen a significant time investment and also capital which was unforeseen and its frustrating as in the grand scale of things we are a small business and that money would have been really helpful in scaling our operations and not on red tape and doing paperwork.

We have done things right from the beginning of the process and all products were sold prior to the FSA deadlines.

What are your views of the future of the CBD market in the UK and Europe?

There is no doubt that NF has slowed the growth of the market with so many brands falling off, the more brands the better in my opinion as it grows the market. Once we can get through this period I am extremely excited about the future, quality products and the ability to develop new exciting products will see CBD hit new levels.

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