Bubs Australia growing up after teething problems

There was a time just over a year ago when infant formula maker Bubs Australia seemed always in the news and the news was good.

The company whose unique selling point is its use of Australian goats milk in its products was Australian Exporter of the Year in 2022.

Its products were flying off the shelves in China and the company was basking in its unique access to the US market which was then facing infant formula shortages.

Bubs sent more than 1.25 million tins of formula to the US in that year under the US government’s emergency Operational Fly Formula, and was applying for permanent access to that market.

But then in 2023 Bubs seemed to suffer set back after set back with the company’s distribution in China in meltdown and Bubs forced to write off more than $25 million in stock held by its China distributor.

In July that year the company outlined a recovery strategy of online-to-offline (O2O) sales and installed new management.

That only sparked bitter dispute which led to a failed attempt later that month to spill the board of Bubs Australia by a shareholder group led by ousted founder Kristy Carr.

But those in charge of Bubs health are now hoping that a $14 million placement in November and new strategy are showing signs of renewed health.

Bubs issued a statement last week complete with steadily rising sales graph and news that weekly US sales were now exceeding 24,000 tins sold.

Chief Executive Officer and managing Director Reg Weine (pictured) told investors: “We are continuing to see exceptionally strong demand for our products in the USA, and we have now reached a new weekly scan sales record in the USA with revenue exceeding US$1 million.

“Pleasingly, we are seeing sustained demand from more than 5,800 bricks-and-mortar retail stores stocking our products.

“In addition to the rapid growth we are experiencing from USA customers in physical stores, we are now the #1 best-selling infant formula on Amazon USA.”

Bubs China market is also showing signs of robust health.

Weine said: “Bubs focus on the O2O channel is already paying dividends with 143 new outlets stocking Bubs during April and May.

“…Importantly the ‘overhang’ of Bubs Supreme inventory in the China market that created several challenges and was held by our former distributor is now behind us as we enter FY25 with ‘clear air’ and strong momentum.”

Further reading:
Australian Exporter of the Year award goes to Bubs
Infant formula maker Bubs makes inroads into US market

Picture: Bubs Australia/Reg Weine