BUBS AUSTRALIA BOOSTS CHINESE PRESENCE, SHARES SURGE MORE THAN 13 PER CENT

BUBS AUSTRALIA BOOSTS CHINESE PRESENCE, SHARES SURGE MORE THAN 13 PER CENT
BUBS Australia Limited (ASX: BUB) has expanded its footprint in China after signing a strategic partnership with NetEase Kaola.com which will give it access to up to 15 million potential new customers

The infant formula and organic baby food producer will sell its range on Kaola's cross-border e-commerce platform and the announcement sent Bubs shares up by 13.8 per cent to $0.17.

Kaola has the highest market share among China's cross-border retail import e-commerce business, meaning Bubs is well placed to tap into the strong appetite the Chinese market has for safe infant formula products.

NetEase Kaola CEO, Ms Zahng Lei, says Bubs' products will be well received by their 15 million targeted and affluent customers.

"Their goat milk infant formula and organic baby food will be in great demand in the high-end oriented and diversified Chinese market," says Lei.

"Kaola is looking forward to the deeper collaboration with Bubs Australia to offer Bubs high quality Australian made products to our Chinese customers."

As part of the announcement of the partnership the two companies participated in a livestream event showcasing Bubs products which was viewed more than 1.3 million times.

Baby products, including infant formula, make up Kaola's second largest product category, behind cosmetics, with 42 per cent of their customers having purchased related products.

Kaola's customers spend twice as much as the cross-border e-commerce industry average per transaction.

Bubs Australia CEO, Nicholas Simms, says the partnership with Kaola, owned by NASDAQ-listed Chinese internet group NetEase, is an important step in the group's international expansion strategy.

"We consider this strategic partnership with NetEase Kaola to be an important development in progressing our cross-border e-commerce strategy," says Sims.

"By establishing long-term agreements directly with leading platforms, we can reinforce Bubs premium positioning and Australian provenance in a controlled environment, whilst remaining highly scalable and appropriately manage our inventory."

Bubs is not the only company successfully tapping the Chinese demand for infant formula. Last week the a2 Milk Company (ASX: A2M) upgraded its forecast revenue by almost $19 million because of increased Chinese demand.

Never miss a story: Sign up to Business News Australia's free news updates

Follow us on Twitter, Facebook, LinkedIn and Instagram

Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

Four ways businesses can use artificial intelligence to triumph in 2022
Partner Content
The last two years have delivered major disruption to the technology industry and broad...
PROS
Advertisement

Related Stories

Zip Co annual transaction volume tips over $10 billion mark

Zip Co annual transaction volume tips over $10 billion mark

Australian buy-now pay-later (BNPL) giant Zip Co (ASX: Z1P) is now ...

Pet Circle raises $125m to become Australia's latest unicorn

Pet Circle raises $125m to become Australia's latest unicorn

The dogs, cats, birds and fish that grace the pages of Pet Circle h...

Digital used car dealership Carma emerges from stealth with $28 million seed raise

Digital used car dealership Carma emerges from stealth with $28 million seed raise

Sydney-based online used car dealership Carma has today revealed a ...

Shipeezi pre-seed raise attracts logistics, tech experts as SaaS eyes future ASX listing

Shipeezi pre-seed raise attracts logistics, tech experts as SaaS eyes future ASX listing

Fast-growing supply chain management software company Shipeezi has ...