5 Mistakes New CBD Brands Make (And How to Avoid Them)

I've been making CBD gummies by hand in Louisville since 2016. In that time, I've watched dozens of brands launch with big dreams—and I've watched most of them disappear within two years.

It's not because CBD is a bad business. It's because new brands keep making the same preventable mistakes. After eight years in this industry, surviving bank shutdowns, payment processor problems, and constantly shifting regulations, I've learned what separates the brands that make it from the ones that don't.

If you're thinking about starting a CBD brand—or you've just launched one—here are the five biggest mistakes I see, and how to avoid them.

Mistake #1: Skipping Third-Party Testing

This is the fastest way to kill your brand before it starts.

Some new brands think they can save money by skipping lab tests or using in-house testing only. Big mistake. Your customers are putting your product in their bodies. They deserve to know exactly what's in it—and so do you.

Third-party testing isn't just about proving your CBD content. It verifies there are no pesticides, heavy metals, residual solvents, or microbial contaminants. One bad batch without proper testing can destroy your reputation overnight. Worse, it can hurt someone.

How to avoid it: Budget for third-party lab testing from day one. Use an ISO-certified lab. Test every batch, not just your first one. Display your Certificates of Analysis (COAs) on your website where customers can easily find them. Transparency builds trust, and trust builds brands.

Mistake #2: Choosing the Cheapest Manufacturer

I understand the temptation. When you're starting out, every dollar matters. But the cheapest manufacturer is almost never the best choice.

I've seen brands come to me after their "bargain" manufacturer delivered gummies that were inconsistent, had wrong dosages, or used low-quality ingredients. Some discovered their manufacturer was cutting corners on sanitation. By the time they found out, they'd already shipped product to customers.

Your manufacturer is your partner. They're making the product that carries your name. If they mess up, you take the hit.

How to avoid it: Visit the facility if you can. Ask about their processes, their ingredient sourcing, and their quality control. Request samples before committing. Look for manufacturers who are transparent about their methods and willing to answer your questions. A good bulk gummy manufacturer will treat your brand like their own reputation depends on it—because it does.

Mistake #3: Making Medical Claims

This mistake can end your business with a single FDA warning letter.

I get it. You believe in CBD. Your customers tell you amazing stories about how it's helped them. But the moment you put "cures anxiety" or "treats pain" on your label or website, you've crossed a line that regulators take very seriously.

CBD products are not approved to diagnose, treat, cure, or prevent any disease. Period. Making those claims—even in customer testimonials you share—can result in warning letters, product seizures, and forced shutdowns.

How to avoid it: Stick to structure-function claims that don't reference diseases. You can talk about "supporting calm" or "promoting relaxation" without claiming to treat anxiety. Have a compliance expert review your labels, website copy, and marketing materials before you publish anything. When in doubt, leave it out.

Mistake #4: Ignoring Compliance

The hemp industry has more regulations than most new brands realize—and they change constantly.

State laws vary wildly. Some states have banned certain cannabinoids. Others require specific licenses or registrations. The 2018 Farm Bill gave us federal legalization for hemp-derived CBD, but the details of enforcement are still evolving. And don't even get me started on the patchwork of rules around Delta-8 and other cannabinoids.

Brands that ignore compliance don't just risk fines. They risk having their products seized, their bank accounts frozen, and their business shut down entirely.

How to avoid it: Stay informed. Join industry associations. Subscribe to regulatory updates. Know the laws in every state where you sell. Build relationships with a lawyer who specializes in hemp and CBD. Yes, it costs money—but it costs a lot less than getting shut down.

Mistake #5: Underestimating Marketing Costs

Here's the cold truth: having a great product isn't enough.

The CBD market is crowded. Really crowded. New brands launch every week, all competing for the same customers. If nobody knows your brand exists, it doesn't matter how good your gummies are.

I've seen brands spend everything on product development and manufacturing, then have nothing left for marketing. They launch to crickets. No traffic. No sales. No growth. Within months, they're gone.

Making it worse, traditional advertising channels like Google and Facebook have strict restrictions on CBD advertising. You can't just run ads like a normal business. You need creative strategies—content marketing, SEO, influencer partnerships, email lists, and more.

How to avoid it: Plan your marketing budget before you launch, not after. Expect to spend as much on getting customers as you spent on making product. Build your email list early. Create valuable content that brings organic traffic. Partner with influencers who align with your brand values. Marketing isn't optional—it's survival.

The Bottom Line

Starting a CBD brand is hard. I won't pretend otherwise. But the brands that make it are the ones that take quality seriously, stay compliant, and invest in growth from day one.

I've been doing this since 2016 because I do it right. Every batch tested. Every ingredient intentional. Every gummy made by hand in our Louisville facility. If you're looking for a manufacturing partner who won't cut corners on your brand, let's talk about working together.

Your brand deserves better than the same mistakes everyone else makes. Learn from them instead.

— Steve Schultheis, Founder of Steve's Goods