Australia’s move to ban plastics from slowing down the environmental impact of humans has gained momentum in the last few years. Plastic bags at your local Coles or Woolworths were removed in 2018, then just last year, single-use straws were phased out of existence – as a result, your milkshake now has a cardboard straw that falls apart before the drink is even finished or if you’re lucky enough there will be a weird metallic taste from a non-bendable metal straw – life’s tough.
To keep up with environmental compliance, many companies are making moves to adopt bioplastics to limit their impact when an item is disposed of. Eco-friendly company Secos Group (ASX: SES) has seen significant success with its biodegradable garbage bag called MyEcoBag, distributed to retail chains nationwide.
Expanding sales through more retail stores has been Secos drive their growth. Recently, Woolworths (ASX: WOW) has taken notice of its success and has Secos as its preferred brand by consumers. Secos has now locked in 970 Woolworths outlets to stock their 8L bags, whilst 930 stores will stock the 36L bags.
“The success of our MyEcoBag® range continues to exceed our expectations and is becoming the preferred brand by consumers who shop at Woolworths. With 970 stores soon to be stocking our 8L bag and 930 stores stocking our 36L bag, we feel extremely optimistic that MyEcoBag® will become a household name over time,” said Secos Group CEO, Ian Stacey.
Sales for the 36L bags have grown over 550% year-over-year (YoY), and their 8L bags have grown over 450% YoY. The Company expects the growth rate of MyEcoBag sales to be further accelerated by 400% after this expansion, adding a sales potential of $25M over the next year.
The success of the biodegradable bags has validated the Board’s decision to invest funds into developing a global retail brand. The Company will continue to execute its growth strategy and has plans to garner market share in grocery stores in Australia, the US, Latin America and elsewhere. Currently, the major retailers distributing the product include Woolworths, Officeworks and Pacchini in Australia, with United Canteen Services and United Natural Food stocking the product in the US.
Secos shares have been tracking mostly lower since a high of $0.39 in August 2021, currently the share price sits at $0.25.
Trading Desk Assistant at Emerald Financial
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