Episode 40: From 2016 to Now and Beyond



Joe: On this episode of the "CBD University Podcast," our monthly look at our partnership and distribution of CBD products to retail locations nationwide. We'll introduce you to Cardinal Bay Distribution, learn what led them to distributing our CBD products, the trends they are seeing from consumers of CBD products, and how the retail landscape continues to evolve in 2020 and what lies ahead in the industry. This is the "CBD University Podcast," and it starts right now.

I'm Joe Agostinelli, host of the "CBD University Podcast." If this is the first time tuning in, we welcome you to our podcast. If you are a returning listener, we welcome you back to our podcast. Reminder, you can subscribe to our podcast on your favorite podcast platform of choice, and you can also see full video episodes of our podcast on the Global Widget YouTube channel and the YouTube channel of our brands. And it's certainly been a challenging year for the convenience store industry, but CBD products continue to be among the products that consumers are buying at retail locations. And this is our time-to-time look at one of our retail and distribution partners. And with that in mind, I welcome Chase Cranford in for the podcast, the Founder and Managing Member of Cardinal Bay Distribution. For those of you watching on our YouTube channel, once again conducting this podcast via Zoom with Chase. And Chase, welcome remotely to our podcast.

Chase: Hey. Thanks so much. This is really neat, being on my first podcast. I'm glad to be doing it with you guys.

Joe: And we're glad you decided to do your first podcast with us. We appreciate that.

Chase: Us too.

Joe: First of all, Chase, just for our listeners and viewers, some background on Cardinal Bay Distribution.

Chase: Sure. So, Cardinal Bay is a CBD, or cannabis-only, distribution company. We've been doing business for 30 years in different iterations of that. We started in the weight loss and skin care product category, like I said, about 30 years ago, and our primary focus is the independent nutritional health food and herbal store space. That's been our focus for 30 years, and we hope to continue with that. But we've been in the CBD space for five years now, and we've been right alongside you guys, so I look forward to talking about that.

Joe: Yeah, we'll hear more about that, but first, where are you guys headquartered?

Chase: So, we're headquartered in Raleigh, North Carolina, which is where I live and where I am right now, and our shipping warehouse where everything ships out of is just right down the road in Pinehurst, North Carolina. That's the home of golf. If you're a golfer, you've probably heard of Pinehurst. And we love it there, and that's where I had the pleasure of being born and raised.

Joe: And how large in the company...how large is the company, excuse me, and when we talk about service area, how large of an area are we talking about?

Chase: Okay. So, the company is a pretty tight-knit, lean operation. We have a three-man core team, but the model that we use really leverages long-time partnership channels that we've developed over the years. We have several regional sub-distributors that really dramatically enhance our reach, but like I said, relatively lean operation in the sales and operational capacity, but we service all 50 states. Independent brick-and-mortar retailers, our core specialty is that. The ideal customer is that independent, community-centered brick-and-mortar retailer in the micro, small, and medium-sized market, and they certainly have those in all 50 states.

Joe: And we touched on this a little bit in the introductory, but what type of retail locations do you distribute to?

Chase: So, like I said, our core is the nutritional sort of herbal store, that store that has that owner that is willing to develop the passion to educate the customer, and that's really been very important in the CBD space. But yeah, that's our core. But we also service all kinds of different, you know, independent stores that are coming about, independent CBD stores, smoke shops, really anyone who has the ability to educate the customer and really drive the experience positive for their customers is who we look for. But we really want them to be independent because we find that to be very important to have that skin in the game.

Joe: And let's go back in time a little bit. So, you were deciding to incorporate CBD into your inventory. What was the process like of deciding to add that? And I ask that because for the folks who have not maybe yet included CBD in their inventory, they're just going through this process, or in the middle of this process, but what was it like when you guys first went through it?

Chase: Well, it's pretty easy to remember that. We've kept our eye on the cannabis industry really over the last decade, but, you know, us doing that from North Carolina, it felt like we were really only doing it at 30,000 feet. But I remember back in early 2016, one of your founders, Kevin Collins, called the office and he asked if we'd ever heard of hemp-derived CBD or if we'd been approached about any kind of distribution opportunities from other manufacturers. And I said, "Hold on, what do you mean? What is CBD?" I didn't really know what it was. Obviously, one of the major cannabinoids in the cannabis plant, but at the time, the big one was the one that began with a T. Of course, that wasn't legal to sell out of North Carolina or across state lines, so again, it felt like we were at 30,000 feet.

But the CBD came in and we tested it out. He had a two-count blister pack called Hemp Bombs, which we loved the name. We did a ton of research. We sampled and lab-tested the products, everything came back the way we hoped it would. We started sending it out to our retail partners, we got on the phone, we educated them. We did all kinds of different marketing, educating folks about the benefits of CBD that we were learning ourselves. And like I said, we loved the customer feedback and the name, and so we just went crazy marketing it.

You know, it might be a little bit different for some of the retailers who are getting involved in it today. Today, it's a whole different world. Back then, it was the Wild West, and Global Widget really was one of those businesses that, you know...they offered the product, they offered the lab-testing that was easily traceable, and I really felt like you guys have always been on the forefront of that, especially with all the different information that you get from your legal team and everything. But anyway, I get off on a tangent pretty easily, but we really started feeling the potential energy of the product from the feedback. People would call and just give incredible feedback about all the products that we were sending from Global Widget. And so, we just went crazy marketing it, like I said, and the product line just started becoming even more robust.

Today, when I hear from a retailer, "What should we carry?" you know, "Just give me an example of what we should carry," people don't understand there's so many more questions that they need to be asking, "What's your average customer looking for? Are they looking for something that could potentially help with pain relief or with sleep?" And most of the time, these brands that I've seen on the market, a lot of them have sort of just said, "Yeah, this is it, this is the Rosetta Stone," so to speak, and you really need to focus...these independent retailers understand that they really need to focus on educating, "This is what product you need for this specific issue that you're facing."

And, you know, that's one thing that Global Widget has certainly helped with, the educational side. But like I said, today, it's a completely different ball game. Everyone needs to make sure that there are multi-stage testing for their products, the quality, and everything like that, which of course Global Widget brings to bear. And so, getting started in that retail space today, that's a completely different ball game.

Joe: And it's interesting you mentioned the two-pack of capsules, which was the very first product. And I invite our listeners and our viewers, if you haven't yet done so...just a couple of weeks before this podcast episode was first published, we featured a video across our social media networks through our Hemp Bombs brand that took a look at the timeline from 2016 to where we are today, and then this is our Year of More, a lot of the newer products that have come out this year, but also where we've been from the beginning in 2016. And is that how you incorporate new products into the inventory, is that feedback from retailers?

Chase: Well, absolutely. You know, it's very, very clear what sells in these small, independent retail spaces. You know, you can look at the display and say, "Okay, this is what's selling. Well, what is it? Is it an edible? Well, yes, it's an edible, the edibles are selling incredibly. So, maybe we should continue developing those." That's the one thing that Global Widget does better than many, many manufacturers. A lot of these manufacturers that I've seen that approach us with distribution opportunities, you know, have one edible, and it comes in 1 milligram, and this is that key to that space. Well, you know, the development of that product line, the gummies, for example, with the calming and the high potency, I saw that from day one.

Obviously, at the end of the day, sales are what is gonna entice retailers to bring the product in, but at this point, we've got such a legacy with the products that Global Widget has developed that it literally only takes me picking up the phone and saying, "Hey, they came out with another product," and 9 times out of 10, the retailers are gonna say, "All right, throw some in my order," which is great, to have that kind of a brand loyalty that, for example, Hemp Bombs has developed, as well as Nature's Script and Perfect Paws.

But yeah, I mean, at the end of the day, the retailer really needs to have something that can be eaten, something that can be consumed maybe like a tincture, sublingually, and certainly something, you know, for pain management, if you will, like a Pain Freeze, which is, I believe, the best topical on the market. So, you know, the retailer really does need to understand before they get involved in distributing CBD exactly what the individual is looking for. And we believe that through Global Widget and all the educational initiatives you guys have put forth, this podcast being a great example, we know exactly what to tell the folks and the folks know exactly what to go for, what to offer their customer.

Joe: And on that note, it's been an interesting year, obviously, with everything that's gone on in 2020 and some of the consumer trends that you're seeing when it comes to CBD products in the convenience store industry. How have you been able to incorporate the new products given what has changed throughout this year in the industry?

Chase: Well, I mean, that's a great question. What we've seen since day one is that the customer has requested, "We need more potency, we need more milligrams per unit," and we would love to see the value of those milligrams rise. I'd love to be able to see more milligrams per unit which would equate to that value. That's certainly something that Hemp Bombs, and Nature's Script, and the manufacturer have really pushed forward. With all the changes in the industry, you know, that's very difficult for all that to sort of hinder our initiative. I mean, there are things that happen from time to time, there's always gonna be the regulatory uncertainty that can create headaches and things like that, but we just try and keep our nose to the grindstone because we know that these products are helping our customer's customers, they're helping our customer in the fact that they've been a godsend for our industry.

Our industry's going through a lot of changes itself, the independent retailer, you know, with the Whole Foods of the world and the Amazons of the world, which certainly have their own place. But, you know, the changes that have happened over time have all been for the better, especially post Farm Bill, in my opinion. But I do find it very interesting to listen to folks like Rod Kight, who have a tremendous blog, and I know he's been on your podcast, and to stay up and involved with regulation, and so on and so forth, proposed regulation in that manner. It really helps sort of ease our minds to know that there's someone out there who's really fighting the good fight. So, that's been really interesting. But our customers are saying, "More CBD, more CBD products, please," and we're focusing on that, and it's very clear that Global Widget is as well.

Joe: In our Year of More, we'll be happily able to satisfy that demand. We talked a little bit about this with the education. What are some of the most pressing questions or issues that you hear from retail location when it comes to the sale of CBD products?

Chase: Yeah. So, obviously, those concerns have changed over time. In the early days, they were a lot different than they are today, as you can imagine, but today our customers are really focused on quality and product availability. I mentioned earlier back in 2016 when we started sampling these products out and started actually partnering with Global Widget, you know, back then it was absolutely the Wild West. We were getting samples probably starting around after they called me. We were getting samples from manufacturers, white-labelers three, four times a week, I mean, wanting us to distribute products. And some of the stuff looked like it was made in a bathtub.

Now, obviously, that's changed over time, but the access to quality and to documentation of that quality has been paramount to our customers since day one. And, again I take my hat off to Global Widget for the incredible amount of data that you guys have provided, that Global Widgets has provided since day one in that regard. And they also, frankly, are a little bit concerned about product availability. I get a lot of phone calls from customers that maybe they have a hot product from A, B, C manufacturer and, well, that's sold out. So, then, you know, they start pushing something else and it just leaves their head scratching.

So, when we get a hot product, which we have had many home runs with Global Widget in this space, you know, they wanna know, "Is this product gonna be available? Do I need to buy large quantities so I don't have to worry about, you know, selling out, and so on and so forth?" And that's always been a huge plus for Global Widget because, you know, you guys are not a small operation and the product availability and the ability for me to get that product distributed to our store, you know, whether it's somewhere in California, or somewhere in Michigan, or Florida, or wherever, you know, quickly is extremely important. And so, the product availability piece is also very important, and that's also a huge selling point for the products that Global Widget offers.

Joe: And hard to believe, but we're heading into the final months here of 2020. What challenges do retailers continue to face regarding CBD products that a trusted partner such as Global Widget may be able to address?

Chase: Yeah, still that headwind of regulatory uncertainty. Like I said earlier, you know, listening to various industry insiders, and attorneys, and things like that on podcasts, and reading blogs and things has been very enlightening when it comes to that, and I've been able to share a lot of that with our customers. You know, a lot of things that are happening right now and were proposed to be happening right now in different areas such as cannabinoid isolation, things like that, it'll be interesting to see where that falls on the regulatory spectrum. I think it's very important for us to be able to continue to develop the cannabinoids inside the cannabis plant to help our customers, our customers' customers, but it'll be interesting to see where that line in the sand is drawn. I'm hoping that we can continue to have a little bit more of a liberal-type policy on that, but time will tell.

But, you know, regulatory uncertainty, uncertainty about, you know, product availability again, which we don't face unless you guys do a big run of a huge product and then it's like, "Oh, two weeks. Oh, no, Vince, I gotta call Vince and get him on the horn." But, you know, the headwinds in the industry is really primarily, in my opinion, regulatory and we just gotta continue to grow, and evolve, and, you know, show that we are extremely transparent to regulators and maintain all that documentation that's needed. That's something that we've needed to do from day one, and that's what we're gonna continue to do.

Joe: And we look forward to being along for the ride as your partner in your CBD journey. And I do appreciate you taking time for joining me on this episode of the "CBD University Podcast." But before we wrap up the podcast, side question. Have to ask it because you brought it up and I noticed it on your LinkedIn profile picture. You talk about Pinehurst, you talk about golf, so I gotta ask. I mean, you're probably a golfer, you've probably played Pinehurst. What's the handicap piece?

Chase: When people ask that, I always give them my pre-children handicap, which was a two, which was cool. But now that I have children and I can't go out and practice as much, but I do take them with me, I'm at about a six right now, but I'm working hard at getting that back down towards that two here soon. It's cool watching my kids go out and do something that I love so much. And I'm trying to get my wife involved in it, but she just likes to drive the golf cart, so it's fine.

Joe: Well, best of luck with the golf game, and from all of us here, continued success with all you guys do over at Cardinal Bay. Chase Cranford from Cardinal Bay Distribution, my guest on this episode of the "CBD University Podcast." And once again, thank you for taking time out of your busy schedule to join me today.

Chase: This was so cool. Thank you so much. I look forward to all the future "CBD University" podcasts, and just thanks for the time.

Joe: Yeah, anytime. We look forward to having you back on the podcast with some more topics in a future episode. So, once again, thank you. And I thank you, our listeners and viewers for tuning in to this episode of the "CBD University Podcast." If you have not done yet already, please do subscribe to our podcast and you'll get notifications on whichever platform you subscribe to, whether that be the audio version on your favorite podcast app or on our YouTube channel, that's the Global Widget YouTube channel or the YouTube channels of our brands for full video episodes, and you'll get notifications each week when new episodes are published. I'm Joe Agostinelli, the host of the "CBD University Podcast." Thanks for tuning in.

These statements have not been evaluated by the Food and Drug Administration. The CBD products are not intended to treat, cure, or prevent any disease or condition. Always consult your personal physician about CBD and using CBD products. CBD should never be used by anyone under the age of 18. This content is not intended to provide legal advice regarding the legal status of CBD and CBD products.