The Bubs Australia Ltd (ASX: BUB) share price has jumped 20% in early reaction to US expansion news.
US launch puts the Bubs share price in the spotlight
Bubs is going to launch on Walmart.com, the e-commerce platform of the world’s biggest retailer from September 2021.
How big could the USA infant nutrition market opportunity be? According to Euromonitor Data 2021, the total infant market formula retail market size is US$5.1 billion.
Bubs is initially going to launch with two products, and Bubs’ first ever bi-lingual English and Hispanic label. There will be the Australian goat milk-based toddler formula and the grass fed milk-based toddler formula.
One of the selling point focuses will be on the ‘clean’ element of the product. These products are going to utilise existing high quality and clean label Bubs Australia formulations – management said this will provide an important opportunity to leverage the consumer global trend towards clean label nutrition.
Bubs said that its range of existing formulations have met stringent ‘clean label purity’ standards with confirmation of the clean label purity award and Prop 65 regulations for the Bubs range.
This will launch will mean its the only Australian goat milk formula product on the USA market.
Other US launch growth details
Bubs is currently on the Australian Amazon site, but it’s also going to launch onto the American Amazon site too.
It’s going to establish a US subsidiary called Aussie Bubs Inc, which will do the in-country marketing and it will be based in the health-conscious Northern California.
Bubs has also commenced the expansion of retail distribution footprint with USA Broker appointment, including a national network of sales agent companies selected as exclusive sales representatives across the USA.
The infant formula business said that there is USA based supply chain infrastructure in place, including warehousing and distribution models.
QR authentication trust codes have been fully implemented across the Bubs range for the US market consumer product tracking authenticity with secure vertical supply chain integration.
Summary thoughts on Bubs and the share price
The Bubs share price has jumped 20%. If it can capture just a 1% market share then that’s a big opportunity. But there is a lot of investing for growth before getting much traction.
It’s one of the high-risk ASX growth shares, but Bubs could be one to watch over the longer-term.
