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It’s no secret that in recent years, our pets have become more than just an extension of our family, but part of our actual family.

This growing bond has brought innovation and a boom in products and services catered to our four-legged family members, and we wanted to tell the stories of not only our best friends but of the people driving this industry forward.

There’s never been a better time to enter the pet market!

Our Main Story

In this week’s issue, we’re exploring the world of CBD for dogs and delving into its benefits, side effects, popularity, growth, and market size.

What is CBD?

We’re glad you asked, CBD, or cannabidiol, is a compound found in cannabis and hemp. CBD oil does not contain delta-9-tetrahydrocannabinol (THC) and therefore is safe for dog consumption in small quantities. Your pup will not get high nor will they request your Willie Nelson Spotify playlist.

In recent years, CBD has gained significant attention as a natural remedy for various ailments in dogs and humans. It offers a range of potential benefits, including relief from anxiety, stress, joint pain, inflammation, seizures, and nausea. Many pet owners have reported improved mobility, increased appetite, and enhanced overall well-being in their furry companions.

Now the bad news: CBD is not FDA regulated or approved. There is a huge variation between products in terms of their quality, as well as potential contamination from THC and synthetic cannabinoids. Some pet parents have reported drowsiness and diarrhea as side effects.

Expanding Market Size The CBD pet industry in the USA has witnessed significant growth. According to market research, the sector is projected to reach $1.7 billion by 2025. This expansion stems from the rising acceptance of CBD, shifting attitudes toward pet well-being, and a wider array of product choices. Furthermore, Nielsen predicts that CBD pet products will make up 3-5% of all cannabidiol sales in the United States by 2025.

In North America, the primary retail channels for buying CBD pet products are:

1. Online pet stores

2. Veterinarian offices

3. Chain pet stores

4. Specialty CBD stores

5. Independent pet stores

In 2021, a significant majority of CBD-related pet products (77%) purchased in the U.S. were intended for dogs. Millennials make up 53% of pet CBD consumers, and 73% of pet CBD consumers also use CBD themselves.

Based on Zippia, these are some of the largest CBD companies in the US:

• Charlotte’s Web, estimated revenue of $74 Million (2022)

• Gaia Herbs, estimated revenue of $54 million (2022)

• Pure hemp botanicals, N/A

• cbdMD, estimated revenue of $35 million (2022)

• Medical Marijuana Inc., estimated revenue of $34 million (2022)

• Green Roads, estimated revenue of $33 million (2022)

• Medterra, estimated revenue of $24 million (2022)

No Regulation

Back to the regulatory aspect. Currently, everything in the Marijuana ecosystem is still a bureaucratic nightmare and the ones that suffer are not only consumers but entrepreneurs as well. The FDA is trying to figure out some regulatory paths for hemp as a dietary supplement but that’s it.

The lack of oversight makes it harder for pet parents to pick out the best products for their pets. However, these are some things you may want to consider when purchasing CBD products:

• Made from Superior Broad Spectrum CBD

• Doesn’t contain added fillers or artificial ingredients

• A Certificate of Analysis* (COA)

• The words “THC-free” on the label

• An NASC Quality Seal (for applicable products)

*COAs provide a quality standard that allows a third-party laboratory to test the product independently and verify the company’s claims.

Research

There aren’t a lot of studies that have shown the therapeutic efficacy of CBD in dogs, however, in recent years more universities are studying the potential benefits of CBD with optimistic results.

Some studies are revealing certain benefits such as a decrease in pain in 80% of dogs with osteoarthritis, allowing them to be more comfortable. Other studies have also shown an active reduction in seizures and an increase in epilepsy control for dogs with epilepsy.

As always, before giving your dog anything new, consult your veterinarian and ask them to recommend the best products.

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Business Roundup

• And the house is left to…Whiskers? A Tampa lady left her mansion and her inheritance to her 7 cats. As we covered in the past, this is becoming more common.

• D O Double G - Petco and Snoop partner up for a new pet health ad campaign. Snoop also has a new pet line which will be available at Petco nationwide starting in August.

• Grooming in the dough - Gabriel Feitosa is a dog grooming artist, besides having a massive following on social media, Feitosa’s salon raked in about $1.2 million in 2022.

• Farm to Dog - For The Love Of Dutch is a local company in Charlotte North Carolina that works with local farmers The food is made weekly and delivered to your home every Thursday and is only available in the greater Charlotte area.

• Lyka raises $25 million - Australian pet wellness startup Lyka just raised $25 million. Human-grade pet foods having their moment and investors are seeing the potential.

• A non-Chile market - US exports of dog and cat food to Chile almost tripled from $13 million in 2015 to $36 million in 2022. US pet-food companies

• Kids menu, no. Dog menu, yes - This NYC restaurant offers owners that dine with their pets a first-class meal using the same ingredients (minus the seasonings). Could this catch on in other restaurants?

Biz 101

Alright folks, so this week's section is going to be slightly different. Potentially a bit shorter than normal. This is something we want you to keep in the back of your mind and action when you think is relevant. You may tackle this before you start or a bit later on. Up to you. It's very likely you will need some support (Clifford the accountant) in doing this, so get the convo going early. In a nutshell, have you considered the legal structure for your business?

You probably have a couple of options - be a sole trader, create some limited company structure, or perhaps even go exotic with a partnership. The key here is to get some really good advice and guidance (from that expert) on what you should do, and potentially, if needed, get the expert to implement it as well. Here are some considerations:

• The more complex you go, the more likely you will need to account for some additional admin costs. As a company, you may need to file accounts annually and get your taxes done professionally. As a sole trader, those may not be needed, or be simpler/cheaper (tax prep)

• The more complex you go, the more likely you could get things like tax incentives and tax schemes implemented. You may also be able to plan efficiently for withdrawing money from the business through dividends and different allowance thresholds

• It's a lot easier to be a sole-trader if you are...hmm... a sole-trader. If there are a few of you launching the business, it may be "cleanest" to create some entity with clear ownership and rules

We are keeping it short in this one on purpose. A lot of this will come down to your specific geo of operation and cost-benefit analysis which you can do with your advisor. The key is to get the ball rolling here from the start and take the right time to plan and implement.

You reached the end, you deserve a treat 🍖

We’ll see you Thursday, same time, same place!

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Finally, Why did the lion eat the tightrope walker?

Because he wanted a well-balanced meal!

See you Thursday!

The Woof is a 2x weekly newsletter dedicated to covering the pet industry.