LONDONDERRY — The popularity of CBD products is driving the kind of growth once reserved for gourmet burger joints.
American Shaman, a national franchise producing and selling holistic cannabidiol products from industrial hemp, opened in Londonderry last month. The owners, Joshua Gragg and Casey Stingel, both of Derry, aim to open their next store in Manchester by May 3. Following that, they hope to open a store in Nashua in mid-May, followed by stores in Salem and Concord.
While the retail trend of selling CBD oil has spread across the state since the passage of the 2018 Farm Bill, which legalized industrial hemp, and in turn, CBD, Stingel said their company is unique and isn’t directly competing with the other vape stores and smoke shops that sell CBD products.
Instead, American Shaman caters to an older and middle-aged demographic and is designed to be a comforting, spa-like space, free of the stigma that accompanies traditionally marijuana-friendly establishments. Stingel said their product is superior and that they are equipped with more expertise for answering customer questions.
“A lot of our customers mix theirs with their coffee in the morning,” Stingel said.
The market for hemp-infused products is on track to become a billion-dollar industry, according to industry reports. Curaleaf, a Massachusetts-based cannabis company, announced in March that it signed a deal with CVS Health to begin selling hemp products at 800 stores in 10 states. Walgreens plans to sell CBD creams, patches and sprays in nearly 1,500 stores in select states, CNBC reported last month.
The cannabis family of plants, of which hemp is included, contains CBD, but not necessarily THC, the psychoactive ingredient in marijuana. The latter is still on the federal controlled drug schedule and is only legal in New Hampshire with a therapeutic cannabis prescription. While CBD reacts with receptors in the brain similar to endocannabinoids produced by the body to create homeostasis, Stingel said, it does not create a euphoric sensation.
Stingel said the response so far has been “overwhelming.” He said the initial investment of about $30,000 to open the Londonderry store has already been earned back, with $64,000 in sales in March. And they are on track to make about $75,000 in sales this month, he said.
“Seventy percent of our business this month will be repeat customers,” Stingel said.
The cost to start the business includes a one-time franchise fee of $5,000 and a recurring monthly fee of $1,000. The initial inventory from American Shaman cost about $10,000.
Setting up the Manchester and Nashua stores are expected to cost about $40,000 each, Stingel said.
CBD is believed to provide many health benefits, such as anxiety and pain relief, Stingel said.
Stingel said he has suffered from heightened anxiety and severe panic attacks for years, a condition that is common with the men in his family. Since he started using CBD products about seven months ago, he hasn’t had any anxiety, Stingel said.
He also gives it to his young son, who is diagnosed with ADHD, with enough positive effects that he has taken his son off prescribed stimulants.
American Shaman grows and harvests industrial hemp in Kentucky and Colorado, and manufactures its products at a facility in Kansas City, Mo.
Gragg said a proprietary nanotechnology enables the company to extract higher concentrations of CBD, and lab tests are done to demonstrate those concentrations on labels. American Shaman also uses every part of the hemp plant, not just the stalk, as other CBD processors do, which Stingel said results in capturing other helpful plant ingredients such as terpenes and flavonoids.
The stores carry at least 80 percent American Shaman products, and they are free to stock the stores with other brands out of the remaining 20 percent. They also carry brands such as Canna-Hemp, Terp-FX and PureHemp.
The primary products are water solubles and tinctures, which Stingel said are not oil-based, meaning they bypass the digestive system and enter directly into the bloodstream.
Stingel said oil-based CBD products need to be broken down in the digestive system, and many of the beneficial elements get destroyed in the process.
Other products include pet chews for cats or dogs, body lotions, gummies, protein supplements or vape cartridges.
“You’d be surprised how much pet stuff we sell,” Stingel said.
Stingel said the company offers a “compassionate care” program which offers a 30 percent discount on extra strength CBD products for patients with cancer or other terminal illnesses. There’s also a standing 10 percent discount for active members of the military, veterans and first responders.
Eventually, after the five stores are set up, Stingel said they would invite any other people interested in becoming franchisees to train with them about the product and the business.