Amazon made 670 million in one year! A couple born in the 1980s sold their pots and sold their shares to IPO

Kitchenware is a popular category on Amazon. According to statistics, the sales of Home & Kitchen category on Amazon US is expected to reach 103.3 billion US dollars this year, a year-on-year increase of 21.8%, becoming one of the fastest growing categories. In this context, many kitchenware sellers from China have benefited greatly.

Successfully listed on the Hong Kong Stock Exchange, with the stock price rising by nearly 60% on the first day

Last week, Hangzhou Amazon kitchenware seller CAROTE rang the bell at the Hong Kong Stock Exchange, announcing the official start of trading . It took CAROTE half a year from submitting its prospectus in March this year to completing its listing. It is reported that on the first day of listing, CAROTE's stock price rose by nearly 60%.

According to information, Carrot's full name is Carrot (Commercial) Co., Ltd., which was founded in 2007. The company was formerly a cookware manufacturing company in Zhejiang . After being taken over by Li Huiping and Zhang Zhihui in 2007 , it was renamed Carrot, mainly OEM for European and American kitchenware brands ; after being taken over by Lv Yili (daughter of Li Huiping) and Zhang Guodong (son of Zhang Zhihui) , a couple born after 1985, the company transformed in 2013 to focus on ODM business - after having its own R&D group, it began to design and develop new products for international brands.

Three years later ( in 2016), the company's own brand "CAROTE" was launched . In the past eight years, Carote's own brand business has developed to many regions and markets around the world, including the United States, Western Europe, Southeast Asia and Japan.

At present, although the company operates ODM business and brand business together, the brand business accounts for 89.5% and the ODM business accounts for only 10.5% (as of March this year).

In terms of revenue, Carrot has been on a tear since 2021. The prospectus shows that from 2021 to 2023, the company's revenue reached 675 million yuan, 769 million yuan and 1.583 billion yuan respectively ; net profit was 31.7 million yuan, 109 million yuan and 237 million yuan respectively. In 2024, the revenue in the first quarter reached 503 million yuan, and the net profit was 88.51 million yuan; while the revenue in the same period last year was only 292 million yuan.

Among various markets, the proportion of overseas markets such as the United States and Western Europe is also increasing year by year . The prospectus shows that in 2021, Carrot's domestic revenue accounted for 57.7%, but it dropped to 23.4% last year, and only 18.5% in the first quarter of this year. At the same time, the proportion of the United States and Western Europe has increased from 16.5% and 2% in 2021 to 53.6% and 7% in 2023 , reaching 60% and 7.6% in the first quarter of this year .

( Source: Carrot's prospectus )

When Carrot was first launched, it was actually Taobao in China. However, the competition in China was already very fierce at that time . There were both established players such as Midea, Supor, and Joyoung, as well as emerging brands such as Bear Electric, Morphy, and Xiaomi. The pressure Carrot faced can be imagined. Based on this, Carrot adjusted its strategy in time and began to move to the international market in 2017.

In the international market, Carrot's performance is quite impressive. According to a report by CSI Consulting, based on retail sales in 2023, Carrot ranks among the top five in the online cookware industry in major overseas markets: second in the United States, third in Western Europe, second in Southeast Asia, and third in Japan; with market shares of 13.1%, 1.3%, 8.6% and 8.1% respectively.

More than 95% of the brand's revenue comes from online, with Amazon being the main channel

After moving to overseas markets, Carrot has placed its focus on online channels. The prospectus mentioned that the vast majority of the company's brand business sales are completed online, accounting for 97%, 97.6% and 99.5% in 2021-2023 respectively; and in the first quarter of this year, Carrot's brand online business accounted for 97%.

In the online channel, Carrot adopts the DTC model as the main mode and the B2B model as the auxiliary mode. While developing third-party e-commerce platforms such as Amazon, Walmart, Rakuten, Shopee, and Lazada, Carrot has not relaxed the construction of its own website. However, Amazon's business is still the most important source of revenue for Carrot.

In 2021, Amazon accounted for 22.5% (63.7 million) of Carrot's e-commerce platform, but in 2023, the share jumped to 48.8% (673 million) , and in the first quarter of this year it reached 52.2% (235 million). Data shows that Carrot currently has Amazon sites in the United States, Japan, Germany, and other countries, as well as India and Spain. Among them, the US site is the company's main source of revenue in the Amazon channel, accounting for 67.7% last year.

( Source: Carrot's prospectus )

It is worth mentioning that Carrot has also been recognized by Amazon. In addition to winning Amazon 's 2022 Global Layout Brand Award, the words "Top Brand" can also be seen on Carrot's product details page (US site). It is reported that in the past three months alone, Carrot's orders have exceeded 100k+; in addition, more than 100k users have given high praise to Carrot's products.

(Photo source: Carrotmeyer store)

At the same time, many of Carrot's products have been selected as Amazon's Choice and Best Seller. For example, an 11-piece non-stick pan set (including a wok, frying pan, stew pot and matching lid) sold for $59.89 on the US site during Prime Day was not only listed as a Best Seller, but also selected as Amazon's Choice. It is worth mentioning that the handles of this set of cookware are detachable, which makes these pots easy to store.

In the past month, the sales of this set of cookware exceeded 6,000 sets, with a total of 18,600 reviews. Among them, 72% gave 5 stars and 11% gave 4 stars. The comments given by users generally mentioned that the product is easy to store, easy to clean, inexpensive and good value for money.

It is worth mentioning that one buyer mentioned in a comment that he has been following this set of cookware on TikTok in recent months. Searching TikTok with CAROTE as the keyword , you will find that many users share videos of themselves using CAROTE. Under the videos, there are many "tap water" comments such as "I like this", "Super good pan", "(I) like Carote cookware set ", etc., which shows that Carote is very popular overseas . In these comments, in addition to the detachable handles, the fresh colors of these cookware are often mentioned.

(Image source: TikTok )

However, although Carrot's development prospects are promising, the pressure should not be underestimated. For example, although the revenue of third-party e-commerce platforms such as Amazon is high, the commissions of these platforms have also become a "mountain" that cannot be ignored on Carrot. Data shows that Carrot's e-commerce platform commission was only 29.6 million yuan in 2021, but it soared to 167 million in 2023, accounting for 68.1%. The second major expense is marketing and advertising expenses, which will increase from 23.1 million in 2021 to 67.6 million in 2023.

At the same time, using third-party e-commerce platforms such as Amazon and Walmart as the main online channels means that Carrot's "lifeline" is not in its own hands, but is subject to the influence of platform policies and other aspects. Therefore, the potential risks faced by Carrot in terms of business cannot be ignored. Coupled with the increasingly fierce competition in the domestic kitchenware industry abroad, Carrot still needs to make great efforts to continue to maintain its current momentum.

Amazon

Kitchenware sales

IPO