According to the analysts over at Cowan, Starbucks—the world's biggest café chain by number of locations—could be the first fast food franchise to put cannabis-infused goodies on their menus.
On Monday, Cowan released a huge analysis on the booming market for CBD - the non-intoxicating cannabis compound, which could generate more than $16 billion in retail sales by 2025. That growth will be driven in part by the increasing adoption of CBD by large established brands—something that the industry has already started to see.
"In our monthly proprietary consumer survey, we were surprised to see that nearly seven per cent of respondents in January 2019 reported using CBD as a supplement," Vivien Azer - Cowan's senior research analyst specializing in the beverage, tobacco, and cannabis sectors - wrote in the report. "This strong consumer interest is validated by the growing number of brands and from factors that are now available through increasingly diverse retail channels, including Amazon, Sephora and Neiman Marcus."
While CBD already has a steady footing in the mainstream wellness market, it could soon break into fast food too. CBD-infused beverages have already become popular menu items at independent coffee shops in states where cannabis has been legalized. And while none of the big fast food chains have begun offering CBD lattes just yet, Starbucks —the world's largest chain of coffee shops—may just be the first to do so.
But you shouldn't expect to see any CBD-infused Frappuccinos until the regulations around CBD have been clarified.
"The dynamics are fluid, likely delaying adoption from major coffee players like Starbucks in the near term," Cowan analyst Andrew Charles wrote in the report. "Should the regulation of CBD oil as an additive to food/beverage change or craft/independent coffee shops find a way to comply with the existing regulation, we could envision Starbucks ultimately piloting the ingredient."
Despite Cowan's confidence that Starbucks will be the first fast food restaurant to dabble in CBD-infused goods, Starbucks CEO Kevin Johnson says it's not something the company is working on right now.
"We're well aware of what's happening around CBD, THC, and all the trends in the industry...We will always stay on top of consumer trends and new ideas," Johnson said. "I think that there are a lot of issues that we'd have to think through on that. Right now, that's not on the roadmap."
With Starbucks' home state of Washington being one of the first to legalize recreational cannabis, it may not be a stretch to imagine them piloting a CBD-infused drink in Seattle sometime in the near future. And with almost 28,000 locations worldwide they have some real potential to corner the market if they get in the door early.
h/t Yahoo Finance