Singles’ Day, China most popular online shopping extravaganza, is still a day away, but its effect is already being felt by angry mothers in Australia who have found the shelves in their local supermarkets bare of baby formula.
One popular brand, Bellamy’s Organic, has seen shortages throughout the year because of high Chinese demand, but it seems to have come to a head in the days leading up to Singles’ Day. According to the Sydney Morning Herald:
One Sydney mother claimed on social media she rang every Coles supermarket within 20 kilometres, a Melbourne mother said she scoured the shelves of 15 shops, and a Perth mother said she drove for three hours – all in search of the elusive “white gold.”
Bellamy admits that a third of its sales in Australia are actually servicing the Chinese market. Increasingly health-conscious Chinese middle class consumers have made a habit of shopping for coveted foreign baby formula brands, due to an understandable lack of trust with the quality of domestic brands following a myriad of tainted milk scandals over recent years. You want your baby drinking unusual amounts of mercury?
With the most frenzied day of shopping in China on the horizon, supplies just can’t keep up, even though manufacturers have quadrupled their production this year. There is also speculation that China’s lifting of its longstanding one child policy has led to even greater demand with more and more people trying to get rich by buying baby formula in Australia and selling it for higher prices on Chinese online shopping sites.
Earlier this week, a photo posted on Facebook by a Melbourne mom of a group of four adult shoppers pushing two trolleys overflowing with around 50 tins of A2 Platinum formula at a local Woolworths’ shop went viral, with many like-minded parents expressing their disgust that the bulk sale was allowed to go through.
“My blood was boiling for the mothers having problems finding A2 for their babies,” the mom told Fairfax Media. “If they were with babies, it would be understandable; they need to feed their kids too. But it felt like a smooth operation, like they did this all the time.”
The A2 Platinum formula 900g sells for AU$25 (110 yuan) a tin in Melbourne while on Taobao sellers are asking for 200 to 280 yuan. Due to increased demand from China, A2’s CEO Geoff Babidge said that his company’s sales are set to triple this year.
“We have had significant growth on online sites such as Alibaba, and also at retail level at grocery and pharmacy where Chinese tourists and nationals are often buying products on trips and taking it back with them,” he said. “We are clearly demonstrating that we are having enormous traction with Chinese nationals. There is no question about that.”
According to The Age, a Facebook user shared the viral photo on to Woolworths’ page, saying: “We are in a formula shortage and you are allowing this?! What happened to four tins maximum per person? Look at the empty crate in the picture?!”
While some Australian supermarkets have introduced buying limits, it is not clear if these limits are being enforced. Other shops have imposed no limits whatsoever.
One courier business owner has taken a stand, refusing to ship to China. He is set to lose $10,000 per month.
Last year, Singles’ Day saw $9 billion in sales take place ($6 billion for Alibaba alone), more than double the amount spent by American shoppers on Black Friday and Cyber Monday combined.
Of course, this is hardly the first time that ravenous Chinese demand has led to formula shortages on Australian shelves and it certainly won’t be the last.
But Chinese consumers should know that other milk options are available to them, they can always stop by their local goat milk van for a fresh glass. China is also considering promoting breast feeding by limiting advertising for baby formula brands; however, adult breast feeding for money, still not ok.