A further slowing in growth
Kosmea’s Managing Director Marie Kapetanakis recalls how she sold the family car to start her organic skincare business, and recounts her journey to heading up the global success story it is today.
Looking back at the success she’s made of her organic skincare business, Marie Kapetanakis, Managing Director of Kosmea, can hardly believe she’s the same person who had what she calls an “entrepreneurial seizure” back in 1993.
“I still pinch myself and think, ‘Is this real? What I have done?’” she says. “It’s all about timing and the passion one has, and driving that passion through every element of the business.”
When she came up with her life-changing idea, Kapetanakis was in her early 30s and living in rural South Australia with her husband and three young children. She’d spent years working as a cleaner and waitress in between raising her children.
What she lacked in experience she more than made up for with a passion for natural remedies passed down from her parents, who had relocated to Australia from Greece in 1964.
“Growing up in the 70s, my mother taught me how to use natural alternatives,” she says. “If we had a cold, Mum would juice up some herbs pulled out of the garden. The passion was in me, so I was always making up concoctions and would experiment on my friends. I’d line them up and make facial masks out of natural ingredients such as honey, yoghurt and avocado. I didn’t read fiction; I only read books about natural skincare and herbs.”
One day while mixing a facial mask from a recipe, she noticed that one of the ingredients was rosehip oil. Her curiosity piqued, she drove to her local rose farm and asked if she could use some of their rosehips.
“I knew that the rosehip was the fruit of the rose flower, so they usually cut them off and threw them away,” she says.
At the farm, they showed her an article about how rosehip oil was used in Chile to treat scars, burns and sunburn, their healing qualities thought to come from their high essential fatty acid content.
“I was walking through the rose farm reading this article, and I got so excited,” recalls Kapetanakis. “I call it my ‘entrepreneurial seizure’, because I forgot about picking my rosehips and thought ‘How can I get hold of more of this rosehip oil?’ because I knew it would be so healing for the skin.”
Back in 1993, Google was a distant dream (it launched in 1998), so Kapetanakis asked a Spanish friend to write down the Spanish word for rosehip for her. She then took herself off to Telstra’s office where they had international editions of the Yellow Pages to search the Chilean edition, and found the name of a supplier.
“I went home and thought, ‘How am I going to communicate with them? I need to buy myself a fax machine. I need to buy myself a typewriter. I need to find myself a company name.’ So all those things happened very quickly. I bought myself a new fax machine for $1000 and a second-hand typewriter.
“[The name] Kosmea came out of one of my old recipe books. It’s an Ancient Greek name, and it means ‘harmony and balance’. I thought that it was a lovely name, and very fitting, because I always believe in nature being in harmony and balance. Natural skincare is balancing for our lives and universe.”
Next, Kapetanakis bought a Spanish dictionary and sent a fax to the supplier in Chile, asking if she could buy some of their rosehip oil.
“They wrote back and said, ‘Please speak English, because your Spanish is terrible, and our English is better than your Spanish!’”
Despite this, they were willing to sell to her. The tricky part was that the minimum amount of rosehip oil available for sale was a 60-kilogram drum. Kapetanakis calculated that she would need to sell 4000 vials of rosehip oil to use it all. But she was undaunted.
She says now: “I had no marketing experience. I had three children, the youngest a-year-and-a-half old. I didn’t finish Year 12. But I couldn’t think about that. I convinced my husband to sell the family car, a Toyota Cressida, and purchased this drum of rosehip oil.”
Kapetanakis and her husband replaced the family car with a Ford Cortina – “an old bomb” with a botched paint job. She designed packaging for the oil, presenting the vials as a set of 12 so they wouldn’t get lost on the shelves, put on a suit and hit the streets to sell her product to pharmacies and health food stores in Adelaide.
By September of that year, she had a company up and running.
“I had this car that I was so ashamed of, and would park miles away from the stores so nobody could see me coming out of this old bomb,” she laughs now. “[Then] I’d walk in, nicely dressed in a suit, and do the sales pitch.
“Everyone I put the rosehip oil in front of loved it. I gave out samples, because I believed that when people tried the product they would love it. It was my one marketing ploy. I had the feeling that if the owner got hooked on the product, they were going to sell it. I also designed a brochure that could be displayed on the counter.”
Looking back, Kapetanakis puts those first sales down to her powers of persuasion and her belief in the product.
“I’ve got the gift of the gab,” she says, “and I was passionate about this oil, because I had started using it and thought it was unbelievable. Adelaide’s climate is very dry, so it was fantastic because it quenched the thirst of the skin.
“I returned two weeks later and the store owners all agreed that the oil was unbelievably good. One told me, ‘My skin has sucked up this oil! I need to get another bottle, and my skin has never felt better. It’s an almost instantaneous result.’”
Within the first six months of starting Kosmea, Kapetanakis knew she was onto something.
“People were so open to using the product, and we were getting results from everybody that we were selling it to,” she says. “People say you don’t make a profit in the first year, or the second year or even the third year of launching a company, because of the set-up costs. We were making a profit in the first year. You know that’s going to be a very successful business if that happens.”
In 1994 Kapetanakis approached NAB for a business loan and invested the money into growing the business. Two years later Kosmea launched a day cream, then two cleansers, a scrub and rosewater. In 1997, the company added a body range including shower gel, body polish, body lotion, and a shampoo and conditioner.
With the Australian market for rosehip products growing nicely, Kapetanakis looked further afield. An Adelaide radio station she’d been advertising on invited her to take part in a radio advertisement that was being recorded in Hong Kong. She decided to take the trip, with the hope of picking up an export customer. Working with Austrade, she made appointments with six different distributors.
“I came back with a distributor and an order,” she says. “I still have that distributor in Hong Kong to this day. They distribute to a chain of pharmacies in Hong Kong.”
Today Kosmea’s exports to Asia, Canada and the US account for about 30 per cent of the company’s total sales. They also provide a welcome balance to the seasonal nature of the Australian skincare market, where January–February is the slowest time of year.
“In the 23 years we’ve been in business, we have built a global business and are [now selling] in eight countries around the world,” Kapetanakis says. “We are in talks with companies in China at the moment, and in the next few months we will enter China via e-commerce platforms.” Kosmea is also looking at a bigger push into the US market to expand its distribution network.
Added to this are the facts that Kosmea’s products are certified organic, and that “rosehip oil is the flavour of the month – or the flavour of the year – for China,” Kapetanakis says.
While offering a unique and high-quality product was crucial in launching the brand, it has been just as important in maintaining its momentum, particularly as the natural skincare has boomed and competition has proliferated.
“Pretty much when we started it was just Jurlique and us,” says Kapetanakis. “Now when you look around in a natural health food store – [or] even if you go into David Jones [or] Myer – you see the natural category is so large, you’re talking more than a dozen brands now that focus on natural products.”
Kapetanakis explains that the unique way Kosmea’s rosehip oil is sourced, grown, picked and extracted makes all the difference, and forms a crucial part of the brand story.
The rosehips now used in Kosmea products are 100 per cent certified organic and grow wild in the Maluti Mountains of Lesotho in southern Africa. The region is 3300 metres above sea level, resulting in high rainfall, pure, clean air and plump, healthy rosehips. Handpicked by local people, the business provides the community with a sustainable income in a country where there is widespread poverty.
Heat, air, water and light can all affect the quality of rosehip oil, so these are avoided as much as possible during the extraction process. To preserve maximum amounts of essential fatty acids, vitamins and antioxidants, the oil is extracted from the rosehips using a heat-free and solvent-free process called supercritical extraction.
Continuous improvement and keeping abreast of the latest skincare trends is also critical, Kapetanakis says. “For us, it’s important to be innovative and always bring out new products, and to reformulate and make our products better.”
Her approach seems to be working beautifully.
This article was first published in Business View magazine (Issue 21).
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