Fiji Kava hopes to make inroads into the Chinese market with the signing of an exclusive distribution contract with Pumate Shanghai, which seeks to generate $8 million in revenue within its first three years.
The contract has one year extension clauses and will see Pumate trade Fiji Kava’s product range-which includes tablets, instant powder mixes and flavoured powder shots, within China and via digital stores.
“This agreement is one of the most material commercial deals in Fiji Kava’s history which creates a major new opportunity for the company to enter China’s vitamin and supplements market, the second largest in the world and estimated at RMB 149 billion ($30 billion),” Fiji Kava chairman Dr Andrew Kelly said.
Pumate distributes other Australian brands, including nutritional supplements, into China. Fiji Kava is listed on the Australian stock exchange.
“The agreement has been structured in a way that diversifies our revenue streams in China via co-development possibilities with manufacturers of vitamins and supplements in China, and sales of Fiji Kava’s existing product ranges through cross-border e-commerce marketplaces and retail partners,” said Fiji Kava non-executive director Nicholas Simms.
“The agreement has been structured in a way that diversifies our revenue streams in China via co-development possibilities with manufacturers of vitamins and supplements in China and sales of Fiji Kava’s existing product ranges through cross-border eCommerce marketplaces and retail partners.”
“There is a growing Chinese investment in the Pacific, with the two regions sharing strong ties and Fiji a signatory to China’s Belt and Road initiative. This unique partnership enables us to capture the growing demand for kava in China, as part of our offering as a vertically integrated primary producer and processor of Fijian noble kava.”
Fiji Kava has previously signed deals with Blackmores-owned Bioceuticals, Coles Supermarkets in Australia, Green Cross Pharmacy in New Zealand, and Amazon in the US. It says the Chinese vitamin and supplement market is worth an estimated A$30billion.
https://www.asx.com.au/asxpdf/20200819/pdf/44lnfdlpjlvtk4.pdf
