Updated: Mar 21, 2022
You heard about the wonders of Kratom, maybe you have seen what the product can do first hand and now you are thinking about starting your own online Kratom business...
Here is what you need to know before you get started.
Merchants who sell Kratom are classified as "High Risk Merchants" and this is not because you have no previous online experience or because you have a lot of chargebacks this is mainly because Kratom has different legalities at Country, State and City Level.
Banks are unlikely to support products that have shipping restrictions, this creates a higher risk for the financial system as they can inadvertently, break the law with a single payment.
Because of these legalities around Kratom, a lot of dodgy payment enablers have managed to take advantage of Kratom sellers, holding reserves, abusing pricing, lying to banks on your behalf. If this sounds bad is because IT IS bad.
WAAVE works with a lot of sellers who have many horror stories to tell from losing thousands of dollars to getting blocked from main credit cards due to the schemes their service providers run. So we are sharing our Top 5 things to have in mind when you start your online Kratom business.
5. Setting Up your website right
Setup is key to your success. There are many website builders out there that do an excellent job helping you build a great site quickly but when it comes to Shopping Carts, they drop the ball big time.
If your site is built with Wix or SquareSpace, that is great! This site is a Wix site and we love it... but we would never try to turn it into an eCommerce website, they simply don't have the right tools.
When you are looking for a shopping cart provider you want one with a lot of flexibility, loads of eCommerce tools, and most importantly an open policy towards payments.
In our experience, Shopify is one of the worst options for Kratom. In the past year they have blocked out Third Paty payment providers and they do not give merchant accounts to Kratom merchants.
WAAVE's favorite eCommerce platform is WooCommerce.
They have the most built-in features, they are very economical and most importantly you can add as many third-party plug-ins as you want.
Once you have created the site with WordPress, you won't need professional help to maintain it.
These are our tips for a better experience on a site:
Simple and Clean is better: Don't over adorn the site or make it too dark, it is all about simplicity for your customers to feel comfortable with the experience.
Minimize the steps of the checkout, people don't really like to use multi-step checkouts from the cart to check out it should be a single click and they should be able to see your payment options right there.
You don't need fancy templates, when you are getting started make sure you start with something as simple as the free StoreFront option. Migrating a site to a new template is not that complicated so you can always upgrade later. At the start, save your cash flow for your inventory.
Customizing your new site can be tricky if you are not tech-savvy, as WordPress requires at least some basic coding skills. You can hire a freelancer to do this. If you go with a US-based freelancer you will pay more, but there is really no reason to pay more than $2500 for the entire job including inventory setup. A good alternative is hiring from Upwork or Fiverr where you can connect with international professionals to help you set up the site. We recommend you settle for a fixed price and always review the work before accepting it, also go with a freelancer with good reviews and high ratings. It is important to be hands-on with your freelancers to ensure the job is completed in the allocated time and that you love the end result.
4. Product Quality & Variety
Not all Kratom is created equally, like any product there are suppliers that provide better quality than others. Whatever you decide to purchase please make sure it is tested for impurities. Remember that this product is consumed by people and it is not FDA approved just yet, so it is important the industry makes an effort to keep the highest quality standards possible. Have questions? Need expert advice? Contact our friends at the American Kratom Association they have developed a very cool safety guideline to ensure quality for all consumers.
Kratom is infamous for not tasting wonderful, and for first-time consumers that can be a deterrent, look for new products such as gummies and the new drinkables that are popping up.
Selling the botanical in more than one format can truly bust up your sales.
Marketing is very important and not always easy for High Compliance products. What you tell consumers matters as you cannot make promises or make claims that can not be substantiated with scientific research, and no significant research will happen as long as the FDA continues to ignore the plant.
You will not be able to advertise on Facebook or Instagram, in this case, Google will be your best friend.
Make sure you build a good rewards campaign for your customers, Kratom as a product is an item that is purchased on a weekly or monthly basis so you have an opportunity to retain your customers and earn the repeat purchase.
There are two things we can help you with
Direct Marketing to a highly targeted audience through WAAVE
A Kratom specific subscription product so you can enroll your repeat customers and build strong MRR (monthly recurrent revenue)
Properly curate your brand from the name to the logo and the images you use. There are more and more e-commerce players in the space and you want to ensure your brand makes a memorable first impression.
As we already mention it is paramount that you understand the regulations in the Kratom industry and obviously, you must respect the rules.
WaaveCompliance is our main compliance product and protects the merchant, the customer, and the bank from illegal transactions.
If you want to learn what the regulations are today, you can dig into our Merchant Knowledge Base Look for the Kratom section and let us know if you have any questions. Our legal team updates the regulations constantly to keep the ecosystem safe for all.
If you sell other botanicals or products WaaveCompliance can monitor compliance for multiple verticals on one site and if there is a product we cannot accommodate, you do not need to remove it from your inventory we can actually suppress it from our payment method.
1. Reliable Payment Processor
This is the most important decision you will make for your business. Payment methods can make you or break you.
There is an infinite number of options in the market and most of them are a form of workaround or they are opportunistic businesses that will charge you an incredible amount of money and provide you with a shady service that can land you in legally murky waters.
If your payment processor doesn't have a legit acquiring bank that has approved Kratom, run for your life. And you will know they really have a transparent relationship with the acquiring bank if they name the bank on the merchant agreement.
There are only a handful of payment systems in the US that ACTUALLY have a transparent relationship with a bank and are indeed approved for Kratom sales.
Make sure you get your own MID (Merchant ID), this means you have a real relationship with a bank, and you are allowed to sell Kratom through them
Rolling Reserves are very common in the industry, there are very few solutions that do not require a rolling reserve, WAAVE is one of those unicorns! We do not require a Rolling Reserve for Kratom sales.
Getting your money on time is important that is why daily disbursements are a big selling point when looking for payment processing. Ask for daily payouts.
Payment options are key, for Kratom, we offer all credit and debit cards including prepaid cards, these are very popular for online purchases.
More products are key! Because of the repeat nature of Kratom purchases, having a quick checkout option is necessary, it saves your customer time and builds confidence. WAAVE offers WaaveComplete+ a unique plugin that gives you direct credit card payment on your checkout page but also a Checkout option, very much like PayPal for High-Compliance payments. Your customer can use one the first time and then add a password to check out faster the next time they shop at your online store. We also have a Payment Request feature that is ideal for wholesale and to help customers who require a little extra help to purchase.
We know that until now redundancy has been necessary because you do not know how long your payment processing will last, but one thing you must remember is that when you give your customer 6 options to pay, it can become overwhelming and confusing. Curate the payment options: One card, one ACH, one Crypto. We suggest you step away from PayPal, Venmo, and Cashapp as it can damage your good standing with the cards if things go sour.
Our goal at WAAVE is to provide a well-rounded service that includes Marketing, Compliance, and Payments. We have robust banking relationships in the US and Canada so we are able to get you your own MID and a number of features and products that will help you grow your revenue, sell more, and sell more often!
By partnering with us you will have a transparent relationship with the banks and will no longer fear service interruptions.
We are here to answer any questions you might have, email Kratom@getwaave.com
or go right ahead and get started with the only Payment Solution you will need for your credit and debit card processing of Kratom online sales.