Personal finance and KiwiSaver columnist at the NZ Herald

Research first, sales second

Skincare and beauty entrepreneur Elizabeth Barbalich is aiming to lift exports from 40 per cent of her sales, to 90 per cent. Photo / Mark MItchell
Skincare and beauty entrepreneur Elizabeth Barbalich is aiming to lift exports from 40 per cent of her sales, to 90 per cent. Photo / Mark MItchell

Before Elizabeth Barbalich had a single tube of her Antipodes skincare and beauty range on New Zealand shop shelves, she had thoroughly investigated exporting.

She spent two years researching the global marketplace for natural and organic beauty brands, and the rules and regulations governing the industry in every major market.

"I wanted to look at that from the outset to see how hard it was going to be and could we bring something to the market initially that would have potential in more than just New Zealand?"

Barbalich says the regulatory research was difficult, complex work and not for the faint-hearted, but doing it right at the beginning meant not having to undo costly mistakes when it came time to unleash Antipodes on international markets.

In the United States, where cosmetics come under the same tight regulatory regime as drugs, she spent about $10,000 on a consultant to help unravel the rules.

"We decided at the time that that market wasn't for us for a good five years because it would mean we would have to dull down our packaging and change the language we use for the brand so much we wouldn't have a point of difference."

When Barbalich did finally begin selling the Antipodes range seven years ago, she spent 18 months getting it right in the domestic market first.

Not only was it important to have a strong local base, says Barbalich, but New Zealand's demographic makes it a good test market that is often used by global brands.

The New Zealand market proved tougher than she anticipated and any export ambitions were put on hold so as not to distract her from establishing the new brand.

"It was very easy to get our brand into retail stores; it was very difficult to get consumers to understand our niche position and what we were about.

"The first sale was easy. The second sale was incredibly hard."

Taking the products overseas was less of a leap and more of a shuffle as she wooed distributors to represent the brand.

Barbalich found very few distributors were keen to take on the regulatory headache that trading in skincare involved.

Distributors are necessary for any New Zealand company without the funds, resources or expertise to go straight to the end customer, she says, but it does mean putting your faith in someone to represent your brand authentically.

After the global financial crisis, two British distributors closed. "That was really frustrating but it just made me more determined because we knew we had a good market there."

It took her well over a year to court another British distributor, but her lotions and lipsticks are now stocked in Selfridges, Fenwick and online retailing giant ASOS.

Barbalich says there is nothing easy about exporting and the step across the Tasman was no different.

She says the large retail chains are bureaucratic and purchasing decisions can be ponderously slow to make.

As well, the discount-focused environment that extends to even the big-name department stores means cut-price deals are just a fact of life, she says.

One market Barbalich has intentionally avoided is China.

China requires skincare and beauty products to be tested on animals and Barbalich would never compromise the brand's vegetarian and anti-animal-testing ethos to enter a market.

With 22 staff managing a business that spans nine countries, around 40 per cent of Antipodes' sales are exports.

"My vision is to have 90 per cent of that as export. That doesn't mean diminishing the domestic, that just means growing the export."

- NZ Herald

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