26 Avr Turning challenges into opportunities: the resilience and innovation of a Canadian small business during the COVID-19 crisis
Hanqing Zhao
May 2020
As shockwaves from the COVID-19 pandemic continue to resonate throughout the Canadian economy, some small businesses continue to demonstrate resiliency and innovation in navigating the turmoil.
Established in 2016 by Montreal entrepreneur Mathieu Tremblay, Bblüv provides quality baby products for feeding, care, nursery, and play. A team of 24 employees develops the products in Canada and sells them in 21 countries around the world.
In February, the outbreak of COVID-19 in China slowed the company’s manufacturing process and left Bblüv facing a nearly two-month delay. The slowdown was particularly inopportune as more than 50% of the company’s annual revenue is typically generated in the summer season.
The dilemma grew larger in March when sales in Bblüv’s second largest market, the U.S., were disrupted following the closure of company’s warehouse in Vermont. Deterioration of US sales snowballed into worldwide retail store closures, cancelation of orders and business trips.
“At the centre of the crisis,” Mathieu said, “the pressure was palpable for all the business owners. I believe it is important to take a deep breath and think about how to cope with the difficulties and spur our own transformation.”
Accelerate digital transformation
Undaunted by fading sales at their brick-and-mortar locations, Bblüv enhanced their online presence. By quickly reinforcing the strategic supply to their Canadian e-commerce platforms such as Amazon, Walmart, Toys’R’us and Hudson’s Bay, Bblüv saw their online sales explode, achieving year-over-year sales growth of 30% in March, 65% in April, and 85% in May. Making the growth even more impressive was that it was achieved despite the complete shutdown of their U.S. business.
Bblüv is now hastening their online expansion in international markets. The company is working with Amazon in UK and Australia, Tmall and JD.com in China, Rakuten in Japan, and Lazada in South East Asia, with the aim of deploying their e-commerce before year-end.
Bblüv seized the period of pandemic lockdown to accelerate the digitization of their internal business processes, which includes upgrading their website, implementing a new ERP system and planning for a CRM scheme. “Even under the difficulties, we still want to keep our business moving towards resilience and operational excellence.” Mathieu stated.
Speed up product innovation
Beginning in 2019, Mathieu has focused on advancing Bblüv’s product portfolio, placing an emphasis on the health and well-being of infants. This foresight has become extremely relevant in 2020.
“We had a very strong pipeline of R&D in Canada even before the pandemic and now we are ramping up our innovation abilities to develop a variety of products that have ISO/FDA credibility at a competitive price,” Mathieu commented. Presently Bblüv is accelerating their R&D in reusable baby masks, thermometers and other small electronic devices. These new products will be ready for both online and offline retail outlets for 2020 Christmas season.
Manage risk
The shock of the pandemic on the global supply chain was significant and Bblüv wasn’t spared in the chaos. During the early months of the outbreak, demand surged for their product Termö, a 4-in-1 digital thermometer for babies. However, due to the factory closures and production limitations, Bblüv was unable to keep up with demand, losing millions in potential sales.
This experience has given Mathieu an appreciation for supply chain risk management and has compelled him to develop alternatives for the company’s established operations. “Diversification is the key”, Mathieu concluded, “We are going to look at South East Asian countries, particularly Vietnam, to re-structure our source of supply”. Bblüv is sending a special team to Asia in the summer/fall of 2020 to identify new production facilities where strategic products could be manufactured in the future.
As he continues to navigate the crisis, Mathieu maintains that short-term actions should never overshadow long-term strategies. He believes that long-run growth that encompasses Bblüv’s values and willingness to innovate remains achievable. “Despite the current uncertainties, I am convinced that we are in a great environment in Canada to innovate and export, and I am not afraid of taking the time it needs to create a successful and sustainable business.”
Hanqing Zhao is an MBA from McGill University and an advisor in international business expansion.
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