Let’s just call them both “cannabis” beverages. Cannabis and hemp are really just variations of the same plant and only differ in the amount of THC they contain by dry weight. And whether they have THC below a limit making them legal as hemp or contain a significant amount of THC, the methods for making an extract for use in beverages are largely unchanged. Extractors just take out what naturally occurs in the plant.
But simply making a cannabis extract that is suitable for beverages is just the beginning. After more than thirty years in the more traditional beverage market, I’m amazed at the variety of challenges – and opportunities – for a supplier in this new beverage category!
In my previous experience, I could rely on a certain baseline of knowledge from my customers. Whether they were brand owners, suppliers, distributors or retailers, everyone had some relevant experience in the market which made it relatively easy to discuss products and make decisions.
In the cannabis beverage market, though, there are a great number of entrepreneurs who are newbies. They have great ideas – a lot of really innovative projects unseen in other beverage categories – but they don’t necessarily understand everything it takes to get from idea to finished product.
There are lots of questions these beverage pioneers pose to a supplier well beyond “How does your extract work and what is the price?” Other basic questions we hear all the time include:
How do I find a copacker and how does the relationship work?
Where do I find local/organic/exotic flavor ingredients?
What containers should I use or avoid using?
Tell me about preservatives and pasteurization.
Can I mix DSD and Warehouse Distribution?
We at Farmington Research spend a great deal of time with our brand partners doing far more than delivering water-soluble extract. Unlike some of the purveyors of cannabis extract in the market, my partner Cameron Meshell and I have a long history in the beverage business.
Cameron operated a glass bottling facility in California making a variety of beverage products and knows exactly how to source ingredients, batch products, and ensure the end result is a great beverage in the right kind of packaging. After practicing law, I founded and operated two beverage companies – one a branded beverage product (Mountain Valley Spring Water) and the other a container supplier (Veriplas Containers). My decades of experience in the beverage world have helped me build great relationships and learn everything from bottling to distribution to marketing.
Knowing many of our customers don’t have similar experience, we spend a lot of time upfront carefully onboarding customers so we understand their business model and where we can add value beyond selling them a cannabis extract. We are not a consultant – there are no fees for the extra help Farmington provides. It is simply in our best interest to help our customers thrive.
An example of a recent product launch we assisted is Hectare’s, a purveyor of “small batch wellness products,” packaged in a shot drink format. With early attempts at formulation with an extract supplied by another company, they had taste, dosing, and stability issues. In order to solve their issues, Farmington supplied them with a specially formulated water-soluble extract sourced from Kentucky hemp (a marketing requirement). We then worked closely with their flavor company to fine-tune the benchtop samples. Once the benchmark samples were perfected, Farmington went further to work on-site with the contract packer who had no previous cannabis experience to precisely dose the shot containers in large scale production. The end result: Hectare’s reliably delivers to its fast-growing and loyal customer base a great tasting product with a consistent 30 mg of CBD per serving.
We have also worked on beverages as diverse as carbonated beverages with citrus, uncarbonated water without flavors, tea products in glass, and flavored powder sticks. Yes! Our water-soluble extract can be transformed into a powder which can be delivered in a variety of ways from bulk to individual servings. Powder and liquid drop sales have boomed in recent years and attract consumers who want to use the product on the go or to curate their own beverages. The innovation in the powder/drop subsegment of the beverage market has been eye-opening and has attracted major players in recent years such as Kraft with their “liquid enhancer” named “Mio” and Unilever with their purchase of powder brand “Liquid I.V. Hydration Multiplier.”
Have a question about beverages beyond extract? We stand ready to help you get your idea off the drawing board and into the market.