It’s been called part of the future of babycare, and lauded for its inventiveness. Tired parents probably just call it a blessed relief. Yoomi makes innovative feeding bottles for babies. At the press of a button, a patented unit built into each bottle warms cold milk to precisely the right temperature for a baby to feed.
Jim Shaikh, a former BMW engineer, came up with the concept when he and his wife Farah felt that there could be a better alternative to stumbling around the kitchen in the early hours or begging waiters for hot water to warm their own children’s milk.
Much of his early days were spent in the British Library – “it’s a nice place to be; I did all my IP and market research, and created an investable business plan there.”
To fund the business, Shaikh raised money both from business angels and grants.
The growth of the business has had several significant milestones.”We started with £140,000 of equity which I used to obtain matched funding for R&D awards,” he explains. By the end of his first year he had raised £250,000 and had taken Yoomi from “”a sketch and bits and pieces” to a prototype unit.
The journey has made Shaikh an expert in, and a fan of, R&D tax credits. “The R&D tax credit is very important to us,” he says. “You have to know your way around but once you know the rules, it is quite straightforward.”
At present, Yoomi has two patents nationalised around the world, four design patents, and a trademark.
Since Yoomi’s formal launch at the end of 2009, growth has been in spurts but recently the company found it was bumping up against a trinity of resource constraints: physical space, working capital and people.
A Regional Growth Fund grant, allied with bank and angel finance, is set to unlock these issues and help propel Yoomi onto its next phase of growth.
Yoomi is one of the first recipients of Kent’s Tiger 2000 fund. It provides matched funding on a zero per cent five-year loan specifically for companies located in Kent.
A move to new, bigger premises is the vital first step. The new facility will increase Yoomi’s production capacity and make its operations more efficient; for example, it will create warehouse capacity that currently has to be outsourced.
With more space and more efficient warehouse and delivery systems, Yoomi can increase its production capacity. So another portion of the investment fund will be assigned to capital equipment, and that in turn means Yoomi can manufacture in the UK. A grant from the Manufacturing Advisory Service is enabling Yoomi to move additional packaging capabilities to Liverpool. “We will onshore all our production,” says Shaikh.
“We’ll keep a foot in China but manufacturing in the UK will give us a second bow. We can make at the same price as China, if you look at the total costs of our product.”
A further tranche of the investment will boost Yoomi’s R&D to expand its patented technology into new product areas, such as breast pumps and medical devices.
This financial support will also enable Shaikh to free up the company’s cashflow to invest into sales and distribution.
China set to be significant new market
Exports have driven the growth of Yoomi; at present, 95 per cent of its sales are overseas. Shaikh says that the London office of UKTI has been “very helpful” from the outset; providing advice and support on agent and distributor agreements, export documentation, as well as co-funding the company’s presence at trade shows.
Exporting a baby product across the world is no easy task. Different countries have widely differing regulations, specifications and standards for baby products. Distributors have to be found, managed and reviewed.
At present, Yoomi’s exports are through distributors.
Markets doing particularly well at present include Scandinavia, Eastern Europe – in countries such as Slovakia, Slovenia, Serbia, Croatia – and Russia. Yoomi has just signed a deal to sell its products in Germany’s biggest children’s store.
And, while current sales numbers are small, there is plenty of potential in both Japan and China. Last month, Shaikh signed up two distributors for China and launched yoomi at the Children Baby Maternity Expo, a major exhibition in Shanghai, having taken a booth in the British Pavilion. “If all goes well, China will be a major component of our growth over the next few years and will drive the business forward. We aim to exceed £1m turnover next year,” says Shaikh.
There is more information on this site about how to protect and exploit your business ideas. The British Library provides extensive free help and support. Visit this page for further information about how to finance the growth of your business. Learn more about tax incentives and reliefs designed to help businesses and their investors. Find export opportunities, events and practical guidance on the Exporting is GREAT site.
The UKTI Tradeshow Access Programme can provide funding in the form of grants for eligible businesses to attend overseas trade shows.
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