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Navigating novel foods regulations and growing consumer brands

The public list is not due to be released until next year which has left brands in limbo waiting to see what the industry will be like in 2022.

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: A selection of CBD products from lotions to oils on a green surface with cannabis leaves

As part of the GCI Summit, Hannah Skingle, director of South West Brands and Dominic Day of fourfive CBD held a discussion about navigating novel food regulations.

Hannah Southwest is the director of South West Brands. They are one of the first global, multi-brand consumer goods groups developed specifically for the CBD industry. They have a selection of brands such as Gen-Z focused skincare line, LoveMeMeMe and menstrual cycle brand, FEWE.

Dominic Day is the co-founder of a sports-focused brand, fourfive who specialise in supplements and CBD. A former rugby player for 14 years, he established fourfive with the athlete George Kruis.  Fourfive have recently signed deals to partner with rugby clubs while offering supplements to a gym chain in the UK.

Navigating novel foods

The novel foods process has been a difficult time for brands. It meant an increase in testing and costs before making an application to be authorised. The idea was to make sure CBD products were fit for consumption and authorised by the Food Standards Agency (FSA) before being allowed to be sold.

The public list is not due to be released until next year which has left brands in limbo waiting to see what the industry will be like in 2022.

“We are pretty much where we were at the beginning of the year unfortunately as we are still awaiting this public list from the FSA to come out. It’s really important for UK companies because it will allow us to continue selling our products, Hannah said.

“The brands that are now validated can continue selling but the list still hasn’t come out in terms of Europe. What we are seeing is not only synthetic products being validated but we are now moving through the stages of suitability which is exciting as it’s been stagnant for four years. I’m hopeful that next year, that will move forward into authorisation.”

CBD products

Diversifying brands

Dominic explained that fourfive took the risk out of their application by creating supplements alongside their CBD with the aim of creating products safe for athletes to use. This has given the brand a vital bit of ‘pivot’ if needed.

“A year ago, we decided to move into vitamins including non-CBD products. There’s a couple of reasons behind it as obviously, it kind of de-risked the novel foods scenario that everyone was worried about and it also really fit with our brand story. We looked at the vitamins we would take every day for full recovery or wellness purposes and we were shocked around the quality of the products. Although it fits our product range and story, it also gives us some pivot on novel foods if we need to.”

Hannah was in agreement about diversifying a range to be less dependent on consumable CBD products.

She said: “It’s pretty much the same for us. We are a consumer brands group where we are all about owning and creating brands. On the basis that there was regulatory uncertainty, we didn’t put all of our eggs into creating tinctures and ingestible CBD products. We diversified all of our brands.”

Southwest brands offer a range of skincare, topicals and food supplements that have no CBD in them. As their brand portfolio is mostly concentrated on the skincare market, they have managed to avoid any uncertainty with novel foods. Hannah explains that by being consumer-focused, they bypass the difficulty of the CBD market.

Hannah added: “With Southwest brands, we look at consumers first. We want to service a need for a consumer so we aren’t looking to service the generic CBD industry which is challenging. To do that, you need a lot of money and I don’t think it could be effective for a long period of time.

“With FEWE, we examined functional menstrual care like tampons or pads. We also looked at menopause which is where we found a huge gap in the middle. There was nothing that really honed in on the consumer need for cycled care. That is how we have approached it. We target specific groups of people where there is a need and they are not currently being serviced then we create a brand around that.”

When it comes to marketing, Dominic highlighted how difficult it can be to directly approach consumers. Earlier this year, fourfive CBD announced partnerships with different rugby clubs to promote their products. As Dominic and co-founder, George Kruis are rugby players themselves, it was a natural fit for the brand.

“Marketing continues to be extremely difficult in this space. With regulated products, you can’t do the traditional methods so one thing we are really excited about is our partnerships. We’ve released a few in the last month with Saracens rugby club and Leicester Tiger’s rugby club. It fits with our story but also, legitimises the products because we have worked really hard on them.”

He added: The way we got into those clubs was by talking to nutritionists, doctors, fitness coaches and selling them on it. It’s not a necessarily paid partnership where we are just chucking them money. It’s a very mutual thing where they are using our products and finding the benefits of them. This is something we want to  scale up over the next 12 months.”

Drawing on your USP

When choosing retailers to approach, it’s more important than ever to select the right partnership and build on relationships.

Hannah said: “We believe in our brand and we believe they are different and super unique. The passion part really sells in retail. It’s been agonisingly painful during COVID but that’s starting to change now. Brands are starting to partner more strategically in retail whereas five years ago, it was you would have to go for whoever said yes.”

Dominic agreed on the importance of building relationships. He stated it took around nine months for fourfive to get a listing and into Boots stores. A huge part of their success is that they offer a unique, true story behind the brand.

“They love our story and that there is a face behind the brand. We put a lot of work into building relationships when everything shut down during COVID. They are starting to come to fruition now and we’ve recently launched in Sport’s Direct. For us, there is no point in going to a retailer that mainly serves 23-year-old women because they can’t relate to our brand.

We did fall into that trap at the start where it was about grabbing everything. We just want to grow but now we are looking at it with a more long term perspective. We are going to retailers that really fit with our brand that we can grow with which is key for the long term.”

Navigating novel foods….and COVID

It’s impossible to discuss the difficulties faced by brands within the past two years without mentioning COVID. Hannah and Dominic both touched on how it affected their business models.

“We built during COVID so we had a light headstart in knowing what was happening. The entire business model was built during COVID so we did have that advantage. It really reflected in our business model and how we operate. We understood that the last mile of the value chain was that brand to consumer piece. We work with other partners and it’s not really a buy, sell model. It’s working with people we trust in the industry which means having some understanding that we are all experiencing issues with COVID,” Hannah said.

Dominic said: “We had planned big growth before COVID in terms of retail. We were okay for stock because we had planned ahead and pulled it all in so we looked at our supply chain to make sure things were going to be seamless when everything opened up. It allowed us to get structured.”

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US cannabis companies state that banking is the biggest issue facing industry

Banking access can be a huge issue for cannabis companies

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Banking for cannabis companies
Home » Politics and policy » Navigating novel foods regulations and growing consumer brands

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Cannabis companies cite lack of banking access as the biggest issue facing the industry according to a new survey.

Some of the other issues facing the industry were listed as difficulties accessing investment capital, the legacy market, market volatility, big business competition, and taxes.

Researchers conducted a survey of 396 licensed cannabis companies about challenges facing the US industry. Over 70 per cent of businesses said that the lack of access to banking or investment capital was their top challenge. A further 42 per cent said that state regulations were a huge problem with only 39 per cent referring to the influence of the legacy market.

The report also highlighted that fewer than half of those who responded are currently making a profit. In terms of profitability, women respondents and non-white respondents are faring much worse than white, male respondents. Only 40 per cent of those surveyed believe that the industry is ‘heading in the right direction.’

The banking difficulties are often caused by federal laws and regulations that discourage banks and financial institutions from working with cannabis companies. The Safe Banking Act aimed to amend federal banking laws although the senate refuses to debate this issue.

Beau Whitney, founder and chief economist at Whitney Economics said: “Operators are kept up at night worrying about how to survive in an environment where there is little support, extremely strong competition from illicit dealers from one side, and the existential threat of corporate competition on the other. The only solution for operators is to advocate for a level playing field and hope that reform will occur sooner, and not later,”

The ‘U.S. Cannabis Business Conditions Survey Report‘ was conducted by Whitney Economics. They collect data on hemp and cannabis cultivation, processing, investment, manufacturing, regulation and legislation to build insights into the industry.

The survey was conducted in October 2021 and collected responses from businesses in 20 states. It aimed to examine policy, regulations, success and the industry. It will be the first in a series of ongoing quarterly reports into economic conditions.

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Politics and policy

Beyond the Green: offsetting COP26 carbon footprint by planting hemp

Beyond the Green and the Future For Humanity Foundation has pledged to offset COP26’s entire carbon footprint by planting hemp.

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Beyond the Green: offsetting COP26 carbon footprint by planting hemp

This weekend, Beyond the Green, the first-ever hemp-focused COP Fringe Festival, taking place in St. Luke’s in Glasgow’s East End, is putting hemp and its untapped potential to be good for our planet on the COP26 agenda.

Beyond the Green, EarthAid and the Future For Humanity launch this weekend as solutions to ensure the future of humanity is bright at the United Nations Climate Change Summit, COP26. Founder Sam Cannon says the festival wants to highlight that music and entertainment can bring people together to help the planet.

Beyond the Green and the Future For Humanity Foundation has pledged to offset COP26’s entire carbon footprint by planting enough hemp to ensure COP26 has a climate-positive result. Third-party assessments will be tallied to produce an official report of the carbon footprint surrounding the COP26 events in Glasgow and the number of acres of hemp contributing to this offset. Farmers will benefit directly from this offset from the carbon credits issued.

To do this, the Future For Humanity Foundation is launching a Regenerative Impact Magnifier which demonstrates the power to not only offset the carbon footprint by growing and farming one acre of Industrial Hemp for every one tonne of carbon generated through the COP26 ecosystem of events, but to also create exponential impact by using industrial hemp to replace all of the products that humans use that currently pollute and destroy our environment. This includes replacing plastics, paper, packaging, advanced materials, building materials, fibreglass, fuels and much more. 

Beyond The Green founder, Sam Cannon, former head of music for Ministry of Sound, said: “The time for denying hemp a place at the table for climate discussions is over. Hemp, with its wide range of industrial applications, has been scientifically and industrially proven to be the number one sustainable solution for the climate, capturing at least twice as much carbon as trees whilst taking a tenth of the time to grow. 

“If politicians are serious about fighting climate change and not just dancing to the tune of big business, they need to stop treating this environmental wonder crop as a controlled substance and start putting it at the forefront of climate discussions.”

“What’s needed is for us to demonstrate actionable solutions in a way that engages others to do the same. We need people and the best of solutions from all walks of life, from all cultures and communities, cross-sector and we need it now,” added Future for Humanity Foundation’s founder and executive director Melinda Woolf. 

“This is a movement of using entertainment to reach the masses. Bringing people together with events, music and concerts and even sports to reach people where they are. And it’s exactly what’s needed to bring people together to educate, inspire, and celebrate so that we can create the moonshot solutions for the world’s greatest and most urgent challenges.”

Cannon says the festival’s focus is to create measurable impact both locally in Scotland and across the UK, and continually with its global roadmap of events through 2022 and beyond to contribute to creating action and success for the United Nations Global Goals for Sustainable Development and the 2030 Agenda.

Scottish rock band The Fratellis will join the festival on Saturday night, and the festival will feature panels, workshops and musical surprises. Its special event will include live performances, plus DJ sets from Andy Cato of Groove Armada, Sarra Wild, Darwin and BEMZ, and talks from climate experts across charities, governments, NGOs, culture and entertainment industries.

UMA Entertainment, chaired by Harvey Goldsmith, producer of Live Aid, Live Earth and Live 8, will announce EarthAid Live as a series of stadium events coming in 2023.

Ross Patel, UMA Entertainment Group said: “Music and entertainment will forever inspire, unite and empower. Culture plays a more important role now more than ever in bridging the gap between the challenging realities we face today and the bright possible futures we all have the power to create. 

“We are honoured to be able to provide a platform for artists to speak out and for the entertainment industry to engage in the hope that we create a welcoming and exciting first step on the ladder for those just joining the climate conversation”

All profits from Beyond The Green will be invested into the East End of Glasgow in the form of hemp-based sustainable building materials and multiple other products using the wonder-crop. 

The festival takes place Friday 5 – Sunday 7 November 2021, St Luke’s, Glasgow. For more information please visit www.beyondthe.green.

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European reformers ‘must prioritise medical access over recreational’

The MEP behind an EU effort to unlock the cannabis industry across the bloc has outlined his strategy

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European campaigners must concentrate efforts on unlocking medical cannabis for patients rather than worrying about recreational use.

That was the conclusion of two figures at the head of the push to open up patient access: Maltese MEP Alex Agius Saliba and Bedrocan founder Tjalling Erkelens.

The pair called for harmonisation of rules across the European Union and said helping patients must be a priority for the industry and reform-minded lawmakers.

In March, Saliba announced he had founded a cross-party alliance with the European Parliament to push for liberalisation.

Speaking at Prohibition Partners Live, he shed light on how the project is progressing: “This is a cross-party initiative bringing together different MEPs from different groups.

“The EU as a political institution, if we don’t have cross party agreement it will be very difficult to ultimately gain ground when it comes to pushing forward an agenda.

A cross-party alliance within the EU’s political body is pushing for reform

“I think the numbers are very encouraging, we have more than 40 MEPS from nearly all political groups in the EU, geographically there is a very good balance from different member states.

“We are nearing agreement on the general and specific objectives we will be tackling as an alliance, we are aiming to focus specifically…on medicinal cannabis rather than on issues of non-medicinal use, although I have my own strong views on that.

“We are focussing on stopping stigmatisation of patients who are basically making use of medicinal cannabis.”

Erkelens of Bedrocan, a medical cannabis company based in the Netherlands, said he supported the approach of prioritising patients above leisure, saying the medical versus recreational argument is ‘apples and pears’.

He said: “[Saliba] is totally right with the approach where you say although you have an opinion on the recreational market it should be separated and that is what I have always been saying.

“I’m not opposed to recreational use of cannabis, although there are always issues, but what can not happen to my mind is we have a situation where outlets for recreational are being used by patients to get access to a product they need.

“That separation is important. I would encourage the industry to go for that separation too…the mix up of medicinal and recreational in one company doesn’t work.”

Saliba said key issues that need reform in the European market include the cost to patients, agreed technical standardisations, harmonisation of national laws and fostering cross-continent research.

Commenting on the need for harmonisation across the block, Erkelens said: “Harmonisation of regulation is becoming a theme that everyone is starting to see now where the needs are.

“We have one Europe where everybody does the same thing and then we have this product that divides everybody.”

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