Dive Brief:
- Cannabidiol (CBD) product manufacturer American Shaman has opened a retail store inside a Price Chopper supermarket operated by Balls Food Stores in Kansas City, Missouri, according to a press release.
- The store-within-a-store features reclaimed wood and botanical images meant to evoke the cannabis-based products it sells, which include tinctures and sparkling beverages. The shop also includes a customer seating area.
- American Shaman said this is the first CBD store-within-a-store concept to open inside a multi-store supermarket chain in the U.S.
Dive Insight:
By carving out floor space for a CBD mini market inside one of its stores, Balls Food, which operates more than two dozen supermarkets in Kansas and Missouri, is calling attention to a leading manufacturer in what's become a hot category for grocers. It's also providing a space where workers can answer questions and provide information on products that are still novel to many shoppers.
In the release, Balls said it decided to host the shop in response to growing interest in CBD products from consumers, and that it may expand the concept to additional locations.
According to Hemp Industry Daily, the shop is 550 square feet and will sell 160 products. It will be staffed by American Shaman employees.
Grocers across the country have introduced CBD products to their stores over the past two years. Kroger began selling CBD items at more than 900 stores in June 2019, the same month that Dierbergs Markets added the products in the category to all of its locations. Whole Foods announced in September 2019 that it would expand distribution of topical CBD products to stores in 30 states.
Pharmacy chains have also jumped on the CBD bandwagon, Walgreens said in May 2019 that it would sell CBD creams, patches and sprays in some of its stores, following a similar decision by CVS earlier last year.
Nielsen estimates the CBD market will be worth anywhere from $2.25 billion to $2.75 billion this year, and said educating consumers as well as medical providers will be key.
The market for products that contain CBD, a non-psychoactive component of the cannabis plant used to treat a variety of health conditions, received a jolt from the 2018 Farm Bill, which removed hemp — cannabis with extremely low concentrations of the high-inducing compound THC — from the federal Controlled Substances Act.
That change cleared the way for certain products containing CBD to make their way onto shelves at a number of mainstream retailers. The FDA does not permit the sale of foods or dietary supplements that contain CBD.
Although hemp production is regulated by the USDA, prices for the plant have fallen sharply this year due to oversupply after surging in 2019, Bloomberg reported, citing data from PanXChange. Meanwhile, growth expectations for the CBD market this year have come down because of factors such as store closures and unemployment that have weighed on sales, according to the news service.
