4 Steps in the Hemp Supply Chain Process

The Hemp Supply Chain Process is much like any other supply chain – a product goes from base materials to finished product with a series of steps in between. But the hemp supply chain is unique in that it requires significant diligence to remain compliant and relevant in the CBD space. Let’s take a look.

The Hemp Supply Chain Process

The 2018 Farm Bill legalized CBD hemp for commercial production and sale. However, hemp and its components remain tightly regulated due to its close association with intoxicating marijuana-type cannabis. Consequently, every link along the hemp supply chain must follow strict protocol lest authorities demand its destruction.

This is especially challenging for small to medium-sized businesses due to the excessive time and financial investment required for each step of the CBD supply chain. However, by outsourcing supply chain management, CBD business owners can focus, instead, on what they’re best at: selling awesome hemp products.

Cultivation

The first link in the hemp supply chain process is cultivation. Whether from seed or cutting, farmers must monitor each plant closely for compliance and cannabinoid production. Following a detailed seed-to-sale system, hemp farmers must know exactly which cultivars they’re growing, how many they’re growing, when they plan to test and harvest their plants, and what they will do if a crop goes hot.

To clarify, the FDA requires total crop destruction if plants produce more than 0.3 percent THC, which is the psychoactive chemical in cannabis. Because THC is still federally illegal, any plant that produces more than the permissible amount is also illegal. In other words, hemp farmers risk significant loss if they grow or maintain non-compliant plants. As such, it is crucial that hemp farmers have extensive experience growing this finicky plant.

Processing

CBD hemp processing encompasses a broad scope of production. To begin, farmers must slowly cure cannabinoid flowers or flash freeze them to preserve the volatile hemp terpenes and cannabinoids. Afterwards, the (cured) buds are either processed for sale (for example, rolled into hemp cigarettes) or moved to an extraction facility.

Notably, extraction is the process of removing the potent cannabinoid and terpene-rich trichomes from hemp flowers. There are many hemp extraction methods available to create things like full-spectrum, broad-spectrum, or isolated hemp products. From here, the extracts are either moved to a distributor for consumer sale or infused into other CBD hemp products.

Distribution

After processing, products move to the distribution phase of the hemp supply chain process. This phase includes product testing, packaging and labeling, and retailer distribution. Notably, products that fail the testing portion of this phase will not make it to the end user and instead require destruction. As such, careful product development is crucial to maintain compliance by reducing the risk involved with a shoddy hemp supply chain process.

Additionally, hemp distributors must pay heed to varying hemp CBD laws throughout the nation. To be clear, each jurisdiction holds ultimate authority over their area’s hemp laws, with some more progressive than others. An experienced hemp supply chain manager will understand these variances and distribute CBD products accordingly.

Sales

The final link in the CBD supply chain is retail sales. In this phase, retailers acquire finished CBD products then market and sell them to the end user. Examples of CBD retailers include CBD shop owners, boutique stores, department stores, and other retail facilities.

The sales portion of the supply chain has direct contact with consumers via marketing strategies, sales channels, and educational tools. As such, they must pay attention to both the product and the message to ensure everything is compliant and brand-focused. Notably, this is a massive undertaking. Consequently, many CBD sellers outsource the rest of the hemp supply chain process to experienced supply chain managers.

Outsourcing the Hemp Supply Chain Process

If you’re a CBD retailer, consider outsourcing CBD supply chain management to professional hemp farmers and producers like VCM. Notably, as an experienced CBD supplier, we can help streamline your sales, reduce production costs, and ensure product compliance.

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