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CBD MLM is the Latest Fad to Hit the Direct Sales Scene

CBD MLM business
Written by Alexandra Hicks
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Women, many of whom are mothers, have been following a decades-old trend of selling products directly and recruiting others to sell.

What started as the Avon lady of the 1970s and evolved into the “candle parties” and “lingerie parties” of the 90s, has now transformed into a modernized version of selling cleaning products, jewelry, nail accessories, or patterned leggings directly to customers online – often friends, relatives, and colleagues. But the latest addition to the MLM direct sales scene is CBD.

For reference, MLM stands for Multi-Level Marketing and is a type of pyramid sales model where people not only sell products directly to consumers and take a small commission, but they also recruit others to sell under them and keep a portion of those proceeds. According to the Washington-based Direct Selling Association, 18.6 million people are involved in this industry, and 73.5% of direct sellers are women. It appeals to women because – if they manage to find some success doing this – it offers flexibility so they make money while still taking care of children, working a primary job, or doing other household duties.

CBD in the Multi-Level Marketing World

cbd mlm

CBD is the latest trend of the MLM scene

Although feminine accessories and products have been the main focus of direct sales for eons, hemp and CBD products are the new frontier. According to analytics and market research firm, Brightfield Group, the CBD market ballooned to about $591 million in 2018. And this cannabidiol-craze has noticeably trickled into MLM.

It’s unclear exactly what the total numbers are for CBD direct sales profits, but according to Steven Thompson, founder of CBD MLM company Zilis, business has been exploding for him. He mentioned that his company has grown more than “500 percent in the last two years, and that includes about 30,000 brand ambassadors, or sellers — 70 percent of whom are women.”

This is great for a couple different reasons. First, women are able to earn an extra income while still taking care of whatever other business they need to handle. Second, a lot more people have access to CBD products this way and they’re often buying from a friend they trust. But there are definitely some issues with this style of marketing as well.

Problems with CBD MLM

The main issue is that many of the CBD products coming from MLM companies are low-brow and haven’t been lab tested. There’s no way to know exactly what you’re getting every time. This is definitely something to keep in mind, especially considering that a large percentage of products actually coming from established companies are mislabeled.

cbd mlm

MLM relies on a pyramid sales structure

There’s also the legal grey area surrounding CBD at the moment. Even though President Trump recently approved the new Farm Bill, the FDA still considers CBD largely illegal. It cannot be added to food products it’s unlawful to claim that CBD can officially treat and cure any specific ailment.

Another problem is with the MLM structure itself, in that a large majority of sellers only make a few extra dollars or even end up losing money if they’re required to purchase inventory upfront and can’t find anyone to sell it to.

Final Thoughts

If you’re interested in selling CBD, make sure everything comes from a legitimate company that tests all of their products. It would also be a good idea to use the products for a while yourself, to make sure you’re fully aware of the effects. Either way, it looks like CBD MLM sales are here to stay for quite a while.

If you’d like to learn more about other industry trends, subscribe to our Weekly Newsletter which is full of all the latest news and information about the cannabis industry.

About the author

Alexandra Hicks

Alexandra is the managing editor at CBD Testers. She has always been interested in alternative and natural remedies, and the versatility of cannabis as a healing plant is something that greatly appeals to her. It's for this reason that she decided to work as a cannabis industry journalist and editor, to help spread accurate information about the benefits of this plant.

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