Cannabis
could add value to the cannabis beverage industry , because they have the infrastructure . They have the ability to move heavy liquids from point A to point B in a safe and responsible manner . Whether you call this a three-tier system , whether it ’ s the same actors , I do think that we will benefit from beverage infrastructure facilitating cannabis beverages at the state level .”
TeaPot is currently only distributed within Canada , due to the legal restrictions within the U . S . Despite this , they have hopes to enter the U . S . market in the near future .
CBD : AN ALTERNATIVE ROUTE Of course , while THC remains a touchy subject , the other cannabinoid on the market faces no such hurdles . CBD is a federally legal option that is now a popular ingredient in alcohol-free drinks . Many younger , health-conscious consumers view it as an alternative to alcohol . Southern Glazer ’ s sees massive potential in this area for distributors .
“ Studies anticipate that nearly 100 million adults have tried or will try CBD in the next 12 months ,” says Kariff Rhooms , VP of New Ventures at Souther Glazer ’ s . “ All projections indicate continued growth , as more retailers respond to increased consumer demand . Consumer interest in health and wellness is helping to drive growth in the category . CBD drinks are leading the category . As consumers are becoming more educated about the category , it ’ s our role as a distributor to educate our on and off premise partners . This includes our emphasis on compliance to help our customers feel more comfortable with the category .”
The distributor entered the market in 2020 , to both retailers and producers eager to capitalize on the new product category . “ At the time , some of our retail customers were already selling it and the supplier base was heavily fragmented , which provided an opportunity to achieve significant synergies with our established distribution model ,” says Rhooms . “ Hemp-derived CBD is a highly profitable category with significant market potential . It continues to be an emerging category , with growing interest and demand from consumers , and therefore retailers .”
Despite the buzz around the hot new category , CBD isn ’ t immune to potential legal pitfalls , such as those mentioned that pester THC . Like alcohol marketing , advertising around any cannabinoid needs to be handled delicately . “ Although our coffee does not contain THC , the laws surrounding the use of ads to promote THC and cannabis or even cannabis-adjacent products remain tricky due to ongoing legal complexities ,” says Amber Senter , founder of Landrace Origins , a beverage company dedicated to pairing coffee with CBD . “ To overcome these challenges , we leverage influencer marketing and niche online communities to advertise while exploring other mainstream and in-person promotional opportunities .”
Amber Senter , founder of Landrace Origins .
Kariff Rhooms , VP of New Ventures , Southern Glazer ’ s .
CANNABINOIDS AND RETAILERS CBD ( and likely THC to follow ) has edged into areas that were typically the purview of beverage alcohol . Yet , many don ’ t anticipate a tension between cannabinoids and alcohol . “ Retailers are open to selling CBD drinks ,” says Rhooms . “ In fact , a recent BevAlc Insights survey found that retailers are overwhelmingly optimistic about CBD , with more than 50 % of those surveyed indicating it has the industry ’ s highest growth potential .”
“ Because retailers see the growth opportunity ,” he continues , “ and because of the way CBD beverages are positioning themselves , CBD is not competing for space with traditional alcohol beverages . Brands are marketing themselves according to specific lifestyle-use cases , so they are looking to show up in similar categories on the shelf . A CBD isotonic brand wants to be with the other isotonic beverages , where CBD gummies want to be available for grab and go by the register , and CBD wellness drinks want to be on the shelf with other wellness beverages .”
This focus on niche audiences pays dividends . “ Different marketing strategies are required for different age groups ,” says Senter . “ Landrace Origins ’ target market includes coffee drinkers from all walks of life , from drip coffee drinkers and coffee shop lovers to specialty coffee drinkers and whole bean buyers .”
Coffee aficionados , wellness enthusiasts , and eco-conscious consumers are just some of the up-and-coming demographics that are influencing the market .
The lattermost is certainly one to watch . Sustainability is increasingly important to a growing number of consumers . In fact , you could say that green is the new green now , and many companies have built their ethos around it . “ Sustainability is a key issue in the industry for brands and consumers alike ,” agrees Senter . “ The Landrace Origins team considers sustainability at each phase of production from bean to cup .” Landrace Origins is one of many companies embracing the values of their customers .
THE BIG PICTURE As the future of THC remains murky , and CBD finds its footing in nationwide markets , businesses from all areas of the industry need to remain nimble to anticipate both challenges and windfalls yet to come . While cannabis may not become federally legal within the next few years , all sources agree that it ’ s only a matter of time . BW
Landrace Origins combines CBD with coffee to create new flavor profiles .
20 Beverage Wholesaler • Spring 2023