How CBD Product Sales Perform at Retail

As the effects of COVID-19 impact markets around the globe, the pet cannabidiol (CBD) and hemp category is no exception.

"Prior to the coronavirus pandemic, sales were continuing to grow at a steady pace, and this year was looking to be a stellar year for us in terms of growth," said Min Lee, president of brand development and co-founder of Honest Paws, a manufacturer of pet CBD products in League City, Texas.

Lee said many of Honest Paws’ retail partners closed their stores, but at press time, the company was experiencing an uptick in online sales, which protected its bottom line.

"I do believe that pet retail will have some resilience, but I do think the more essential products will have more insulation than non-essential goods," he said. "For example, I believe dog food and dog supplements will have more built-in protection than toys and treats."

Unrelated to the pandemic, the sales momentum of the pet CBD category has been tempered by an influx of brands entering the market over the past few years, noted Shelby Flinn, education manager for Pet Releaf, a manufacturer of pet CBD products in Littleton, Colo.

"The pet market in general has been down," she added. "A lot of the feedback we hear from our retail partners was that the [U.S. Food & Drug Administration memo warning of a potential link between grain-free dog diets and canine dilated cardiomyopathy (DCM)] has, unfortunately, led to less consumers walking into their store."

However, as people stockpiled essentials in response to stay-at-home regulations, sales picked up for Pet Releaf.

"We know that our product, in many eyes, is a necessity, along with stocking up on food for our pets," Flinn said. "It will be interesting to see the toll on the industry once the virus is controlled."

David Louvet, CEO of Innovet Pet, a pet CBD manufacturer in Gardena, Calif., is optimistic about the viability of CBD sales.

"While the coronavirus has slowed down CBD sales for everyone, sales aren’t declining anywhere near the rapid rate many other industries are seeing," he said. "… CBD makes it simple to care for health in so many ways, and that’s something that will keep this industry moving forward during this time." 

Many retailers are adapting by shifting sales online and offering pick-up and delivery options.

While P&F Pet Provisions in Austin, Texas, still had its physical store open at press time, it was also seeing a huge jump in customers using its delivery service. General manager Taylor Clee-Charlton said the store has had to increase staff, bringing on new delivery drivers and moving existing employees into delivery roles.

"We went from like 14 orders on our best day to 42 overnight," she said.

Prior to the COVID-19 crisis, the store’s CBD and hemp pet product sales were growing exponentially by about 40 percent each month, with chews performing better than oils, Clee-Charlton said.

Products for dogs continue to lead CBD sales by far, although cat owners are also increasingly interested in CBD, Louvet said.

"There are just several unfortunate reasons CBD is more prevalent for dogs," he explained. "They live shorter lives. As well as their bigger size and genetics, [which] make them more prone to several issues like hip dysplasia, seizures and cancer. As well, dogs are more prone to separation and other anxiety issues than cats are."

Clee-Charlton said the discrepancy between dog and cat CBD sales is to be expected.

"Sales in general, at any pet supply store, they’re probably going to be between 9-12 percent for cat, everything else is dog, and you might have 1-2 percent for small animal," she said. "For CBD oil, of course, it’s tremendously more. There are more options for dogs."

Cat owners tend to lean toward pheromone sprays over CBD to soothe anxiety, she added.

New Products

CBD Options Abound

With the spreading popularity of cannabidiol (CBD) and hemp products comes more formats and features for retailers to stock their shelves with.

In December 2019, Honest Paws, a manufacturer in League City, Texas, launched its On-the-Go CBD Peanut Pouches, which contain the same CBD peanut butter as the company’s full-sized jars.

President of brand development and co-founder Min Lee said the pouches, which retail at $3, make a great point-of-sale offering and upsell for customers who are on the fence about CBD.

And in February, Honest Paws released its Relief CBD Balm, which Lee said is the company’s fastest-growing SKU. The balm can be used to soothe and treat rashes, skin problems, and paws and snouts that are dry or cracked.

Pet Releaf, a Littleton, Colo.-based manufacturer, announced its new Pet Releaf Professional line at Global Pet Expo in Orlando, Fla., in February. The line, which, as of press time, was set to launch in May, offers products specific to veterinarian partners, including higher-potency capsules infused with essential oils, higher-concentrated Liposome Hemp Oil and the company’s new CBD & Honey Rescue Sticks.

"With critical ailments that require professional attention, we are offering products that offer a vastly larger milligram per serving," said education manager Shelby Flinn. "… The goal is that our customers recognize the brand that their vet has approved for more serious ailments and will bring new customers to our retailers for everyday ailments and prevention."

Innovet Pet, a manufacturer in Gardena, Calif., recently launched its Nutty Hemp butter for dogs, a natural, peanut butter-flavored supplement that combines the anti-inflammatory properties of CBD, turmeric and flaxseeds.

The company also introduced PurHemp with Catnip Oil, which combines CBD with catnip to mitigate mood and anxiety issues in cats.


Busting CBD Myths

Having a good handle on cannabidiol (CBD) terminology and what separates various products helps pet specialty retailers to dispel misconceptions and misinformation about CBD, said Min Lee, president of brand development and co-founder of Honest Paws, a pet CBD manufacturer in League City, Texas.

Lee said a fair amount of people still think CBD is the same as all other cannabis products and will get their pet high.

David Louvet, CEO of Innovet Pet, a Gardena, Calif.-based pet CBD product manufacturer, said he is most concerned by claims that any CBD is fine to use.

"More often than not, when tests are performed on different CBD brands, their CBD products contain way too little CBD, and illegal and potentially dangerous amounts of THC," he said. "Often, they use extraction processes that strip the terpenes and other beneficial compounds away, weakening potency and efficacy across the board. When buying CBD, if you can’t find the lab results or certificate of analysis that breaks down what’s in a CBD product, then run away."

According to Shelby Flinn, education manager for Pet Releaf, a manufacturer of pet CBD products in Littleton, Colo., retailers should teach consumers to see CBD as more of a vitamin or supplement rather than as a medicine or drug. There is a prevalent stigma, even among retailers, that CBD is only intended for elderly or sick pets, but its anti-inflammatory, immune system and neuro-protectant benefits actually make it a good everyday supplement throughout a pet’s life span, she said.

Discerning the differences between brands is also important, she said.

"No CBD brand is made the same," Flinn said. "… We want everybody doing their homework to ensure the product they give to their pet is safe and effective."

On the back of Pet Releaf’s brochures, there are five questions listed to get this homework started. If a retailer or consumer struggles to find this information from their manufacturer, Flinn said, it can be a red flag:

Where is the hemp sourced from?

If claiming to be organic hemp, is there any certification or documentation to prove that?

What extraction method is being used?

Is it full spectrum?

Is there third-party testing?

Crash Course on CBD

Manufacturers spell out the differences in terminology used for these popular products.

Are cannabidiol (CBD) and hemp the same thing? What about cannabis?

Min Lee, president of brand development and co-founder of Honest Paws, a pet CBD product manufacturer in League City, Texas, explained the terminology as follows: Cannabis is the scientific name for the family of plants that includes hemp and marijuana.

Tetrahydrocannabinol (THC) is the psychoactive compound present in cannabis plants that can cause a high. If a cannabis plant contains more than 0.3 percent THC, then it is commonly called marijuana. Cannabis plants that contain 0.3 percent or less THC are classified as hemp.

Cannabidiol (CBD) is a non-psychoactive compound that is extracted from hemp plants and offers benefits to the endocannabinoid system. Because of the low concentration of THC in hemp, these products do not cause a high.

What is the endocannabinoid system, and how does CBD interact with it?

All humans and animals have an endocannabinoid system, which keeps organs and systems working cohesively, Lee explained.

CBD binds to the endocannabinoid system’s receptors to help the different systems—including the nervous, muscular, immune, respiratory and cardiovascular systems—work together more effectively.

"[The endocannabinoid system] is typically designed to only communicate on a one-way street," said Shelby Flinn, education manager for Pet Releaf, a manufacturer of pet CBD products in Littleton, Colo. "By activating CBD in the system, that street can then turn into a two-way street that allows stabilization of any miscommunication simultaneously between all functioning systems."

What are terpenes?

"Terpenes are additional compounds found in hemp plants," Lee said. "They are not psychoactive, but they are aromatic elements that complement CBD to create what’s often called the ‘entourage effect,’ as they enhance the effectiveness of CBD."

Terpenes all play different roles and distinguish each strain of CBD. For example, pinene is believed to help with cognitive health and gives the plant a pine tree-like scent, while limonene produces anti-depressive effects and a citrusy aroma, Lee said.

Terpenes are also produced by other plants and even some insects, said David Louvet, CEO of Innovet Pet, a manufacturer of pet CBD products in Gardena, Calif. Limonene is also found in the skin of citrus fruits. Myrcene, a terpene that produces relaxation effects, is commonly found in strains of CBD as well as in basil and mangoes.

"The more we research the terpenes, the more we find they are essential to most cannabis products, especially CBD ones," Louvet said. "Without them, people describe CBD effects as feeling stunted, not as pronounced and one-dimensional."

What do full spectrum, broad spectrum and isolates mean?

Full-spectrum CBD is oil extracted from hemp that contains various cannabinoids, terpenes and other beneficial compounds. This type of CBD is the closest to the whole, Lee explained.

The full-spectrum version is often considered the most effective, given that it’s the most complete.

"This is the profile that Mother Nature intended in its most natural form," Flinn said. "The cannabinoids all work together in the endocannabinoid system."

Honest Paws, Pet Releaf and Innovet Pet all produce full-spectrum CBD products.

In broad-spectrum CBD, hand-selected cannabinoids are removed. THC is usually the first to go, Flinn said.

The problem with broad-spectrum CBD is that many other helpful cannabinoids and terpenes are also stripped away, Lee said.

While Innovet Pet is mainly focused on full-spectrum CBD, it also offers a broad-spectrum CBD with THC eliminated.

"[Full-spectrum CBD] contains weaker phytocannabinoids and terpenes that could be replaced with stronger ones," Louvet said. "Broad-spectrum eliminates the weaker compounds, so the strongest ones can replace them. … The issue with broad spectrum is we don’t know 100 percent which compounds are essential to have. There are so many, and many are incredibly tiny and in low amounts."

Lastly, CBD isolates contain only CBD, with all other cannabinoids and terpenes removed through the use of chemicals such as butane or hexane, Flinn said.

Manufacturers agree that CBD isolates are far less effective than full- or broad-spectrum CBD.