Sunday, May 18, 2003
RALEIGH, N.C. (AP) -- There's a buzz within the industry for earth-friendly lotions, soaps and cosmetics -- iconoclastic Burt's Bees is being shopped so its owner can devote herself to her beloved Maine woods.
The private company's majority owner, Roxanne Quimby, built the Durham, N.C.-based business from craft markets in Maine to a multimillion-dollar cosmetics company.
The merger and acquisition Web site TheDeal.com reported last month that Quimby planned to sell the company for as much as $150 million and that potential buyers have submitted bids.
Jessica Barring, a public-relations executive representing Burt's Bees, declined to comment on a potential sale, but did not dispute the reports. Quimby did not return calls to her home in Winter Harbor, Maine.
Forest passion
Her determination to conserve Maine's forests may play a role in why efforts to sell the company -- which Quimby has discussed regularly -- are in the works now.
One of Quimby's passions is raising money to buy land to create a 3.2 million-acre national park in the Maine wilderness. Reports say she plans to use some of her wealth from the company's sale to buy more land for the park, which would rival Death Valley as the largest national park outside Alaska.
Burt's Bees has developed a customer base for its lip balm, bath oils, soaps and about 150 other personal care products made from beeswax, nut oils and other natural ingredients. The items are sold primarily through specialty shops and health stores across the United States, as well as in Canada, Europe and Japan.
The products offer a good-for-you appeal that makes consumers willing to buy a $10 bottle of shampoo as an "affordable luxury" though it may perform no better than a $3 bottle, said Carl Sibilski, a consumer products analyst at Morningstar Inc.
"Consumers get this feeling that they're pampering themselves. Everybody's working harder. They don't have as much time, but they have more money, so they'll buy these types of products," Sibilski said.
Competitors
Bath & amp; Body Works Inc. rang up nearly $1.8 billion in sales last year targeting the same consumers. Burt's Bees' revenue topped $43.5 million last year, a 30 percent increase over the previous year and about five times its 1998 sales.
The segment the two companies share with Tom's of Maine, Aveeda and some products by name brands like Avon, Estee Lauder and Lancome accounts for about 10 percent of the $2.8 billion health and beauty industry, said Maryellen Molyneaux, president of The Natural Marketing Institute, a consulting and market research company in Harleysville, Pa.
Natural personal care products are projected to take a 20 percent share of the market by 2005, Molyneaux said. The segment's growth should continue to expand by about 10 percent a year after that, she said.
How company began
Burt's Bees started in 1984 when Quimby met a beekeeper named Burt Shavitz in rural Maine, where they both lived. From old magazines, they found recipes for beeswax lip balm and polishes for furniture and shoes. They whipped up their products in an abandoned one-room schoolhouse and sold them alongside bottled honey at craft fairs. The small business grew, and by 1992 it was making 500,000 beeswax candles a year.
The company moved operations to North Carolina in 1994 and employs about 120 people at its headquarters and manufacturing plant in a Durham office park.
Product labels still carry images of beehives or Shavitz's rugged, bearded face. Shavitz lives in Maine and is no longer involved with running the company.