Company Interview / Hopping into a healthy new partnership

Key points:

RooLife partners with Care Line for health and skincare product sales.Emphasis on leveraging market intelligence and sales channels. Expansion strategy includes new markets like India and using the RLG marketplace platform.

Bryan Carr from RooLife Group (ASX: RLG) shares the company's partnership with Australian firm Care Line to sell health and skincare products. This collaboration enables RooLife to leverage its market intelligence and sales channels, especially in high-demand areas like China.

Bryan explains the successful sales strategy, focusing on health, wellness, and food & beverages. RooLife manages to customise products to meet market demands and boost profit margins by minimising costs through established channels and customer relationships.

RooLife is expanding into new markets, noting growth opportunities in India. The RLG marketplace offers a comprehensive ecosystem for digital marketing, logistics, and payment processing. Bryan also highlights recent capital raised to meet product demand and fuel market expansion.

Full unedited transcript below:

0:00

Let's get stock specific in the small cap space, and digital marketing and e-commerce sales firm Rue Life Group is partnering with Australian company Caroline to sell health and skin care products. So to get the details on what it all means for life, managing Director Brian Carr joins me now. Brian, welcome to the program. Thank you for joining us. So what does this agreement encompass?

0:26

It works on the premise that in the markets that we operate, we get very good intelligence of products which are in demand. Um, and that, uh, we, that our sales channels are looking for. So partnering with an Australian company, we find that Australian products and raw ingredients are still held in very high regard in the markets we operate in, like China. So we're able to respond very quickly, get those products into market under our own brand name and leverage the sales and the margin growth that comes with it. Okay. And do you sell this Care Line Group's products as well? Yeah, yeah we do. We sell a range of their products. Our specialisation is very much in their health, wellness, food and beverage space. So established products in that range means that we can go to market very quickly. But it also then allows us to to customize those products to meet the specific market demand as well. How are sales going there at Rue Life?

1:20

I'm very good. We we we're growing strongly through a range of different channels. We're focusing a lot now in increasing margins. So we've achieved a lot of sales growth over the last few reporting periods. But we're now very focused on how we maximize the return on our asset, uh, investment. And so how do you do that? What levers can you pull to increase your margins? Yeah. So once we've established a relationship with a customer that allows us to resell to them, um, once we've established a channel, it allows us to sell through that channel. And if we're producing our own products under our own brands, then the sort of cost of goods are obviously lower, and our marketing investment is diminished by having the right channels. And already the established customer relationships. So when it comes to growth. Um, is it a matter of continually getting the brand, the products into new markets, or how do you increase the sales volume where you already are selling?

2:20

Um, yeah, we do both. We, we take, uh, products into those established markets, but we're also looking to grow and diversify into other, uh, other markets. It was interesting. I heard you speaking early on about India and the opportunity that India represents. It's certainly not lost in us. Um, the expertise, the product understanding, uh, the marketing capabilities. Now, platforms allow us to move into new markets such as that. And it's a proven platform. So our RLG marketplace is has already sold about $36 million of products. So it's something we know that scalable and transferable. And that's the opportunity on both fronts. What is the RLG marketplace like? Just just describe it to us and how it's used by customers. Yeah, yeah. So it's an ecosystem that manages everything that's required to be able to sell your product into a new market. So it gives you the digital marketing capability, the online platform, sales and Install operation functionality, but even goes deeper in terms of its. It also managed the logistics, the imports, the regulations,

3:20

regulatory requirements and so everything and obviously the payment processing. So everything that is required to successfully sell your product into a new market, uh, is is encapsulated in the RLG marketplace. Um, when it comes to inflationary pressures within the business, whether that be, you know, input, whether it be logistics, whether it be labor, you know, manufacturing, all the rest of it, are they starting to mitigate?

3:47

Um, we're finding they they are we're finding that, um, uh, sort of the, the input costs obviously across, you know, across the board have increasing. But um, the efficiencies that we get in our operations and in the marketing, uh, are offsetting that. So we're, we're finding that, um, as a, as a, as a business, our costs are actually declining, which is giving us the ability to increase our increase our margins. Uh, now, last week, there was a rights issue, to raise funds. How much are you looking to raise and what will that money go toward? Yeah. So, um, $3.2 million approximately. And it's to service identified demand for products and channels and platforms that we already have in place. So having established very good channel partner relationships, we know that the demand is there for the product. So we want to be able to make sure that we can service that, and we can leverage the capability to expand into the new markets that we touched on very briefly

4:46

before. Okay. Now, when it comes to catalysts for shareholders, what could they be? I mean, I know that you've got this deal with Caroline today that's being announced, but what else is in the pipeline that would give investors some sort of a sense as to when there could be potentially some share price appreciation?

5:05

Yes. Yeah. We most recently announced a sale because of our expertise in certain sectors. One of them is beverages. We we also have great expertise and experience in taking raw materials into into new markets as well. So it's a great example of us taking quality Australian raw materials and producing, uh, what is a beer into the China market? So we're selling RLG Kangaroo beer into the world's biggest and fastest growing, uh, beer market, uh, which is with sales of about $180 billion this year. So it shows us adding value at all ends in all parts of the supply chain and leveraging, uh, demand that is already identified. So we've already got that growth opportunity. We also already have some very big relationships. Uh, like for example, we're working with China's largest frozen foods supplier with a brief to provide input products for them to sell. Also, the another company which is largest, uh, nuts and

6:05

snacks producer. Our brief is to work with them to source the the core ingredients value add in market and then sell into into established, uh, customer bases. So they're the sort of really big growth opportunities that we're working on with really trusted and well developed partnerships.