Below trend growth to continue
When Careline first entered the international market place with their infant formula products, they faced some very tough competition and had not yet developed relationships with big local distributors. Now, they can successfully boast China as one of their main export markets, along with Thailand, Singapore, Macau and Hong Kong.
“We had no idea who to talk to in the beginning,” says Alexandra Zhang, Careline’s Head of Marketing. “But we were very confident about our products, and we spent a lot of money on marketing in order to increase our brand awareness while searching for distributors.”
The initial marketing outlay caused a series of financial difficulties for the company, which Alexandra credits NAB with helping to resolve. “They gave us a lot of support, with an informative and constructive consulting service and great financial products,” she explains.
NAB’s assistance saw Careline overcome their financial problems and develop firm partnerships with their distributors. And now they’re a leading exporter into Asia.
Careline was launched in the early 1990s when the company’s founder and CEO, Norman Li, spotted a gap in the market for health care products. His intuition was proven as the number of orders the company received increased dramatically. “Many of our customers required a delivery service,” says Alexandra. “We were hiring more people, as well as using more trucks to ship orders. So we came up with the idea of wholesaling – it’s helped us increase productivity and reduce cost.”
As the company grew, it became necessary to diversify in order to satisfy different consumer needs, as well as developing brands and products targeting different groups of consumers. Careline is now made up of three divisions: Careline, Health Life Pharmaceutical and Oz Care Dairy.
Although selling direct to consumers could be a future option, Alexandra emphasises that wholesaling is their focus. “Selling direct is a trend of business growth,” she says. “But currently we’re focusing on developing new products and delivering more value to our customers as a wholesaler.”
The global health care market is becoming increasingly competitive, but Careline felt that the quality of their products and the success they’d enjoyed locally meant the move to exporting was worth the risk. “We were No. 1 in sales at the Australia Pavilion, during the 2010 Shanghai World Expo,” Alexandra reveals.
“Unlike the products of many of our competitors, our infant formula is 100% made in Australia. That includes the source of the milk, the manufacture and the packaging. This is what makes our products authentic and competitive in both the domestic and international markets.”
As Careline attempted to enter the international marketplace, they discovered that increasing their brand awareness was a major challenge. Crucial to their success were effective marketing strategies, and the success they’d had at the Shanghai World Expo gave them the confidence to invest in high-end marketing. “Before the Expo, we hadn’t done much advertising or promotional activities,” she admits. “But the Expo showed us we had consumer recognition. It was a good beginning for us when we went into China.”
The cost of that marketing campaign took its toll on Careline’s bottom line, but with NAB’s help, they overcame the challenges with confidence. “Now, we have big distributors in each of our international markets who help us to promote our brand and products with their powerful network,” Alexandra says.
Careline’s products are diverse and they’ve got more in development. “We have different product lines in terms of health care and skin care,” Alexandra explains. “So our product strategy – the way we manage many different lines – has to match up with our targeting and positioning strategies.”
Careline’s expansion plan will see four new products launched in August, and they’re working on the promotion strategy for them. “Being innovative is crucial for business nowadays,” Alexandra says. “And it’s one of our competitive advantages.”
The continued growth of the company has seen them employ over 200 people. Paramount to Careline is that their employees are committed to upholding their reputation. “We conduct employee surveys so we can tap into their insights,” Alexandra says. “And we have a remuneration system that helps us to satisfy their needs and maintain productivity.”
Careline’s relationship with their bank of choice, NAB, gave them the confidence to not only expand into exporting, but to overcome the financial challenges they faced in the international market place. “NAB gave us a lot of help when we first tried to expand into dairy products,” Alexandra reveals. “And they support businesses like ours by providing various kinds of financial products. In the beginning, we were just a small shop selling health care products in Parramatta. As we grew and matured, NAB was always our first choice in terms of a financial partner. Their products and services are professional, secure and flexible for small business. We trust NAB as our financial partner and loyal friend.”
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