The global health and wellness market, valued at $7.07 billion in 2021, is projected to exceed $19 billion by 2031. Following the pandemic, people are reevaluating their approach to health, leading to a surge in demand for health and wellness products. FijiKava (ASX: FIJ), a producer of natural, medicinally-based products such as dietary shots, drinking kava, sleep aid capsules, and drinks, is capitalising on this trend and pushing hard into China.
To expand its presence, FijiKava has entered into an exclusive distribution agreement with China-centric eCommerce distributor RooLife Group (ASX: RLG). In addition to selling FijiKava’s products, RooLife will also provide digital marketing, social media, and other operational support in China and Australia. RooLife will collaborate with FijiKava to co-market the FijiKava powdered drinking kava range alongside RLG’s VORA protein range in the booming online sports nutrition market in China, where over 80% of sales are conducted online.
FijiKava Limited CEO, Anthony Noble, shared, “Alongside the USA, the Chinese market is the biggest international opportunity for FijiKava’s products. This agreement represents work that has been ongoing for more than a year between RooLife and FijiKava, and I am excited to see this come to life in the months ahead.”
As a result of this new agreement, FijiKava Limited has terminated its distribution contract with PuMate Shanghai.
RooLife Group CEO, Bryan Carr, commented, “We are delighted to be working with FijiKava and with the opportunity to market and sell their natural and healthy functional beverages, drinking powders, dietary shots and capsules. It is a natural alignment with our health and wellbeing positioning and digital marketing and e-commerce capabilities in the two key markets for both companies of Australia and China and fits perfectly with our VORA health product range. We look forward to a long and mutually successful partnership.”
As per the agreement, RooLife will be paid for providing digital marketing, social media and eCommerce store operations and receive a margin on all products it sells. The Company has been granted performance rights to achieve retail sales of up to $15 million, with a minimum of $9 million in China, over five years. The initial term of the agreement is two years with periodic reviews of marketing spend, which is funded by FijiKava and may be increased or ceased.
RooLife will also manage and operate FijiKava’s Australian-based online sales operations via the FijiKava website.
Noble added, “RooLife has a proven track record in China with Remedy Kombucha, so we are confident that they can grow an Australian brand through Chinese eCommerce channels and then transition to bricks and mortar retail in the world’s largest consumer market.”
As part of the exclusive agreement, RooLife may receive FIJ shares if it achieves certain sales milestones, including reaching specific levels of retail sales and sales to China by certain deadlines. Given that RooLife dubs itself as a “brand activation agency”, the new venture should be nothing short of a cakewalk.
Alinda is a Business Reporter for The Sentiment
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