Why Would A Legacy Company Launch A CBD Lotion?
Personal Care Stalwart Dives In
By Todd Runestad, New Hope Network
ShiKai is a pioneering personal care brand that has produced topicals, creams and lotions for 50 years. With all the risk inherent in the emerging CBD/hemp extract business, why would a legacy company launch a CBD lotion?
“We go way back with retailers,” said Jason Sepp, president/GM of ShiKai and son of the founder. “It was more important for us to do legal due diligence than other companies that just do CBD. We found ourselves in a position of legal strength.”
One reason why is that the FDA’s infamous May 2015 comment that CBD does not qualify as a dietary ingredient for use in supplements made no mention of cosmetic products.
ShiKai uses a CBD isolate, and a big reason is to reach its target market.
“The future market for CBD topicals is going to be mainstream,” said Sepp. “Ultimately you’re going to be selling to older women with aches and pains or men with arthritis—shoppers at Costco, Walgreens and Walmart. If you can fast-forward five years, that’s your market. We wanted to reach those people with a product that wasn’t green or brown that smelled like dirt or weed, and no pictures of the marijuana leaf.”
An isolate also makes it effective in formulation because isolates do not have taste or color issues.
An issue remains distribution—ShiKai is a national brand, but it has been a challenge to get a national distributor on board because of the legal uncertainties in some states.
“Everybody complains about distributors, but now I know what they’re good for,” said Sepp. “They amplify your success.”
For now, the company is finding workarounds to the national distributor challenge, including direct sales—which is a new tactic for the company. But it’s worth it because of the promise of hemp.
“It’s nice to have found a raw material that actually works,” said Sepp. “We don’t see things like CBD every day with efficacy. We’ve been waiting for something like this that’s real.”
Excerpted by permission from the article “Brand Strategies: How 3 Companies Got Into CBD” by Todd Runestad, New Hope Network.
Update to distribution issue: press release – Threshold Enterprises to Distribute ShiKai Products’ CBD Topicals Line.