Legal hemp remains a niche product

The business still seems profitable, nevertheless - partly due to the professionalisation of the remaining providers.

There was a hype surrounding legal cannabis products in the Canton of Zug a few years ago: hemp spaghetti, hemp flowers, hemp-based supplements and hemp bottles containing cannabidiol, or CBD for short. The Hanftheke (hemp counter) in Raingässli 3 in the Old Town opened in the spring of 2017, followed by Werner’s Head Shop in the lower floor of the Metalli shopping area half a year later. "Hanflife" at Baarerstrasse 21 became the third provider at the beginning of 2018.

They all benefited from the Swiss-wide boom in legal hemp products, as confirmed by Alessandro Bernasconi. Together with his brother, the 32-year-old runs the Zug stores Hanflife and Roberto’s Smart-shop (formerly the Hanftheke). "Customers poured in as soon as we opened our shops two years ago. There was a veritable run on our products, "recalls Bernasconi. Things have changed in the meantime.

Two years ago, many people wanted to try out low-cost legal cannabis products, says Bernasconi. Various providers jumped onto this bandwagon, and offered cheap products, but sometimes with questionable quality. The demand for quality has increased in the meantime, which is why only a few shops have been able to keep up. Bernasconi explains that the profitability of the Zug CBD providers is due to their good quality. And that comes at a price: a hemp oil with 300 to 9,600 milligrams of CBD costs between 44 and 649 francs at "Hanflife" - depending on the CBD content.

The managing director ad interim puts this into perspective: "Our high-quality products thereby come from our own production in collaboration with Swissphytholabs AG in Ballwil, and are regularly tested. In addition, we are in contact with regional farmers in order to be able to produce everything ourselves, from the cultivation to the shop.”

There are hardly any occasional buyers motivated by curiosity nowadays. The offer is known, and the active ingredient does not help all customers. "We now have a regular clientele who are generally more than 50 years old," explains Sales Manager Denise Hubacher. These customers come by regularly for the same products, which help them against various complaints. Cannabidiol was also considered to be a miracle cure for many diseases. For legal reasons, however, sellers in Switzerland may not make any promises of healing. "But we do have customers who swear that the CBD helps them combat pain, sleep disorders or depression," says Hubacher. In addition, they now serve more business people who are looking for a remedy for stress. Tinctures are thereby an all-time sales hit.

Hemp flowers are also popular, and are primarily offered by the "Hanflife" team for cooking. "But there are always customers who tell us that they smoke the flowers. Some do that to help them to stop smoking pot, "says Alessandro Bernasconi. Flowers are sold more often in Roberto’s Smartshop. This shop in the old town of Zug mainly serves customers who prefer the Headshop product range.

The THC content in legal cannabis is usually between 0.1 and 0.5 percent. As this is not enough to have an intoxicating effect, CBD hemp is considered to be legal (see below). The owner of the third Zug provider, Werner’s Head Shop, did not wish to comment on the subject.

Sales manager Denise Hubacher and Alessandro Bernasconi, Managing Director ad interim, examine a new product at the “Hanflife”.

No clear overview of hemp cultivation and distribution

As long as the THC content is less than one percent, hemp cultivation, possession, trade and consumption are legal. Cannabidiol or CBD hemp usually meets this requirement, and is not affected by the Narcotics Act - also because it has no psychoactive effect comparable to THC hemp.

For this reason, there is currently no need for police checks in the CBD hemp shops in the Canton of Zug, says Frank Kleiner, media spokesman for the Zug law enforcement agencies. "If we receive any indications, or suspect that the permissible THC value of the products sold is being exceeded, we will carry out checks – working together with the respective approval authority." In order to distinguish between drug and CBD hemp, the Zug police has carried out a quick cannabis test for about 1.5 years now when checking individuals. This allows the emergency services to directly determine the THC content in hemp on the spot. This has provided positive experiences so far.

Exactly what is cultivated and sold in the Canton of Zug is not known in detail. The law clearly stipulates which CBD hemp products that are placed on sale must comply with which regulations: for example, medicines fall under the law on remedies and foodstuffs, while cosmetics come under the Food Law. In addition, all businesses that process and market products that fall under the Food Law must be registered with the cantonal Office of Consumer Protection. "But CBD products are booming and the delineation of products placed on the market is sometimes difficult. The Food Inspectorate is therefore sceptical as to whether all the businesses operating in the Canton of Zug are properly registered," says office head Rainer Nussbaumer. Five companies are currently registered with the Office of Consumer Protection.