Bubs Australia and Beingmate have entered into a memorandum of understanding which will see the dairy company manufacture Bubs’ goat infant formula in China.
As part of the agreement, Bubs has the opportunity to acquire an ownership interest in one of Beingmate’s infant formula manufacturing facilities in Beihai, China. Beingmate will also support Bubs in securing a state administration for market regulation (SAMR) brand slot.
After obtaining SAMR approval for its infant formula, it will be sold by Bubs to the Beingmate joint venture company, Bubs Brand Management Shanghai Co.
According to Bubs, the new deal will secure it with a faster route-to-market and full access into China’s trade channel, including Beingmate’s existing distribution network across 30,000 mother and baby stores.
The agreement builds on its current joint venture with Beingmate which sees Bubs supply its portfolio of infant formula and baby food products to Beingmate’s distribution network.
“As part of the proposed arrangements, Beingmate will assist in developing a formulation specially for Chinese babies and oversee the regulatory application process,” said Bubs founder and CEO, Kristy Carr.
Bubs Brand Management Shanghai will continue to distribute the Bubs China label product to China’s general trade channel, under the terms of the existing venture.
Carr added: “We are highly confident this step up in our collaboration with Beingmate, one of the largest Chinese owned enterprises in China’s infant nutrition industry, coupled with their extensive capability to manufacture locally in China, will provide invaluable support in securing our SAMR brand registration.
“Given the current geo-political landscape and regulatory risks, this breakthrough localisation strategy for a ‘Created by Bubs’ product to be packed in China exclusively from our own Australian premium goat milk mitigates key risks and provides a secure pathway to gaining full access to the world’s largest and fastest growing infant formula market, valued at AUD 55 billion.”
© FoodBev Media Ltd 2019