I've been reading through these threads, and old company announcements for the past few weeks. I thought about buying in before the announcement, kicked myself for leaving it too late, then was glad I didn't (spending too much time at home in isolation with not enough to think about!) after earnings were announced.
I like what I've read about the company. The marketing, social media and packaging looks high quality. Vietnam is a huge, growing market which will benefit from a shift away from China. And the Chinese market itself is massive. I've spent the past few years living in Beijing (until February). Online shopping and e-commerce there is on a completely different level to anything we have here. The company seems to do a lot right.
The thing that concerns me the most is the number (and growing) of products Bubs is selling. These vitamins for kids seem like a distraction and, as others have said, nobody in China would know who Jennifer Hawkins is. I can't see how Bubs didn't increase Australia sales with all the new distribution options. Mostly, it's the huge product range I can't understand. It will use extra resources, and distribution channels, shelf space, warehousing, transport, etc. They're trying to leverage off the Bubs name with these product extensions, however the Bubs name isn't exactly Nestle or Cadbury... I can't see parents buying or trying this stuff, and it all being scrapped in a couple of quarters' time. So many companies have tried and failed with this plan. Why can't they just stick to the damn milk powder -- at least until "Bubs" is a household name. I have read other negative (against) comments about the product extensions. Can anyone please give me a decent *for* case? I know it has potential to create an extra stream of revenue, but considering Bubs is cashflow negative yet has these great, hard won distribution channels (Coles, Chemist Warehouse, etc.) I would have thought they'd be focusing on getting milk powders onto shelves and consolidating those gains.
They seem to trying too offer too many products to too many different people in too many different markets. I'd appreciate any comments on the line extensions. I am still watching this stock and weighing-up my options.
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