Bubs Australia revenue falls as diagou trade dries up
Bubs Australia has seen gross revenue fall 34 per cent during the first quarter to $9.4 million, largely due to the disruption of the domestic daigou market hurting its milk-powder products.
The business’ infant formula sales, however, remained strong – enjoying a sales uplift across Australian retailers of 29 per cent – while it’s Goat Formula export sales to China jumped 76 per cent.
“To address the significant disruption to the diagou channel caused by the sudden border closures and increased international freight costs, we are working alongside our corporate diagou partners to continue to actively support social marketing with their diagou customers via live-streaming and social e-commerce,” said Bubs’ CEO and founder Kristy Carr.
“We have already started to see positive sales momentum return in late September through to October, and we anticipate improved performance from the daigou channel in the second quarter as we lead into China’s major e-commerce shopping events.”
The business’ new range of children’s vitamins and supplements, Vita Bubs, were distributed to 400 Chemist Warehouse stores in October and have so far exceeded expectations.
Chairman Dennis Lin said the business is now producing the products in anticipation of export orders across China, Vietnam, Malaysia and Hong Kong.
“This is a truly exciting development and demonstrates our ability to launch into adjacent high-margin categories that leverages our brand and core competencies in new consumer nutritional needs and consumption occasions,” Lin said.