When Australians began panic-buying toilet paper and other household essentials earlier this month in response to the COVID-19 pandemic, many parents of babies and toddlers were also left stranded, searching for supplies of nappies and wipes.
At least some of those shoppers turned to online providers instead, with one Sydney-based small business seeing sales for its premium, natural baby wipes jumping by 500% a day since the panic-buying first started.
At the same time, demand for its products is also increasing dramatically from shoppers in other countries, particularly the US.
Suthan and Durka Naganayagam founded Niki’s Wipes in January 2019, as an online subscription-based retailer, after a “heartbreaking” experience when their son, Niki, was hospitalised as a newborn with a serious condition his parents suspected was caused by nappy rash.
“When we recovered, we started to look very closely at the ingredients in many of the baby wipes on the market, and were quite shocked by what we found in some instances,” Suthan Naganayagam tells SmartCompany.
“We wanted an effective, all-natural wipe, and when we couldn’t find one, we spent a number of years developing Niki’s.”
Prior to launching Niki’s Wipes, Suthan worked in senior management at a global IT company, and Durka is an osteopath. Their company now has five full-time employees, as well as three part-time staff members and a number of consultants.
Naganayagam says the company expects to do more than $2 million in sales next financial year, with the majority of sales expected to come from the US market.
Growing with the demand
Niki’s Wipes can be ordered in lots of four, 12, or 24, and customers receive a 5% discount on the price if they sign up to a monthly, three-monthly, or six-monthly subscription service.
While Naganayagam attributes the continued spike in demand for the wipes to the widespread product shortages on supermarket shelves in recent weeks, he says parents are also attracted to an offering that includes free, usually next-day, home delivery.
Similarly, he says over the past year, the team has seen growing interest among people who buy baby wipes for natural and organic products.
Niki’s Wipes are designed for use on sensitive skin, and do not contain alcohol, chlorine or other chemicals. The wipes are also made from ethically sourced cloth, which the company says is eco-friendly.
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“The world seems to be becoming increasingly aware of the benefits of natural and organic products,” Naganayagam says.
“There perhaps isn’t as much brand loyalty to larger brands and businesses that there once was and this benefits our company.
“Consumers are ready to give boutique natural products a try and if they deliver on their promises … will turn into repeat customers very quickly.”
While Naganayagam says the company already had a fully integrated logistics system that allows it to pack and ship products on the same day, it has also now opened a second warehouse in Melbourne, in addition to its facility in Sydney, to manage the higher level of orders.
The company’s production facility can manufacture up to 270 million wipes per year, says Naganayagam, and he believes the company’s forecasting system, and daily contact with this production facility, mean the team will continue to be able to keep up with “oscillating” demand.
While Naganayagam says there is “certainly” a degree of concern about whether the company would be able to continue to operate its warehouses if federal or state governments were to announce further business shutdowns associated with the coronavirus, he says as baby wipes have been categorised as ‘essential’ items in other countries, “we would expect that something similar would occur in Australia to ensure the continued free flow of goods”.
He’s also thinking ahead with plans for if the high levels of demand do start to lessen as supermarket shelves around the country — and the world — return to previous stock levels.
These plans include several marketing campaigns, as well as being “more aggressive in our move from online to retail stores”, says Naganayagam.
“We are an online retailer but due to the level of interest in the product, [we] have begun to have conversations with a number of large retail chains to have a presence in their stores this year,” he says.
And looking further into next year, Naganayagam says future plans could include new product launches too.
“Our core focus is getting our premium wipes in the hands of as many parents as possible, but we do have some complementary products that we have been thinking about and may roll out to the market in 2021,” he says.