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The American Eagle Outfitters teen clothing retailer is following in the footsteps of its rival Abercrombie & Fitch by entering the booming CBD sector.
The Ohio-based cannabis company, Green Growth Brands, announced Thursday that it has signed an agreement with American Eagle to start selling its CBD-infused body care products, including balms and muscle lotions, at nearly 500 American stores. Eagle to start in October.
That follows Abercrombie clothing retailer, which announced last month its intention to sell GGB products in more than 160 stores in the United States.
According to GGB, American Eagle is to date its third major wholesale partner, the other two being Abercrombie and DSW. More and more companies seem to adhere to the trend, or at least think about it, as the CBD sector could become a $ 22 billion business by 2022, according to the research firm specializing in Cannabis, Brightfield Group.
In December, Congress legalized CBD made from hemp. The non-intoxicant cannabis compound is added to just about anything, including makeup, tea, pet treats, and non-alcoholic beverages. Among the regulatory confusion surrounding these products, more and more retailers are feeling comfortable with the storage of skincare and beauty products, such as GGB products.
Even as consumer interest rises, many traditional retailers such as Walmart and Target have largely remained on the sidelines. Walgreens, CVS, Rite Aid and specialty retailers GNC and Vitamin Shoppe have introduced CBD products into stores in a few states, while the large luxury Barney's chain of stores opened earlier this year a High End, exclusive sale of pens and tablets.
Some shopping center owners also join us.
Simon and Brookfield have signed an agreement with GGB to open stores in shopping centers selling items containing cannabidiol, or CBD. Brookfield says that he opens about 70 GGB sites. Simon works on 108.
CBD does not attract users like THC, another cannabis compound. Nevertheless, some people – including regulators – are worried about the possible unintended consequences of marketing cannabis products to minors.
American Eagle stocks are down about 14% this year.