Sharks Are Impressed By Burleigh Wagon's Gross Sales | Shark Tank Australia | Shark Tank Global

Summary

Reagan and Nathan pitch the Burly Wagon, a multifunctional wagon designed for families with young children, particularly those with special needs. Featuring safety belts, Bluetooth speakers, charging ports, and ample storage, the wagon aims to make family outings easier and more enjoyable. Seeking $450,000 for 10% equity, the duo reveals impressive sales figures and plans to streamline production. After negotiation, they secure a deal with Shark Davey for $450,000 in exchange for 25% equity and a royalty arrangement, marking a significant step toward expanding their innovative product in the market.

Takeaways

• 😀 Rean and Nathan are seeking a $450,000 investment for 10% equity in their company, the Burly Wagon, which aims to help parents with young children enjoy outings more easily.
• 😀 They created the Burly Wagon in response to the challenges they faced while raising two young kids, one of whom is on the autism spectrum, and struggling to find suitable alternatives on the market.
• 😀 The Burly Wagon features built-in essentials for parents, including a snack cooler, Bluetooth speaker with charging ports, safety belts, and side storage racks for gear.
• 😀 In addition to its unique features, the Burly Wagon complies with Australian safety standards, unlike other wagons on the market, which are not intended for children.
• 😀 The product retails for $499 in Australia, and it costs $2.25 to manufacture, but the high manufacturing cost is due to 14 separate factories being involved in its production.
• 😀 The wagon's cost to ship within Australia is around $60–65, which impacts its margins.
• 😀 The Burly Wagon has made $2.8 million in lifetime sales, and its recent launch in the U.S. generated $400,000 in gross sales in just 30 days.
• 😀 The company is focused on scaling quickly, especially ahead of the busy Christmas and summer gift-buying seasons, and they plan to use the investment to stock up.
• 😀 Despite the product’s appeal, several sharks decided not to invest due to operational challenges in manufacturing and scalability, leaving Rean and Nathan with limited offers.
• 😀 After a series of negotiations, Rean and Nathan accepted an offer from Davey for $450,000 in exchange for 25% equity and a $10 royalty per unit until the investment is paid back.

Q & A

What is the Burly Wagon, and why was it created?

The Burly Wagon is a specialized wagon designed to help parents, especially those with young children or children with autism, transport their kids safely and comfortably. It was created out of the need to find a solution for parents struggling to manage children and their gear during outings.

What are some key features of the Burly Wagon?

The Burly Wagon includes built-in seat belts, compliance with Australian safety standards, a Bluetooth speaker, two charging ports, USB fan, and side storage racks. These features are aimed at making outings more enjoyable and convenient for parents.

How much does the Burly Wagon cost, and how much does it cost to manufacture?

The Burly Wagon retails for $499 in Australia and $750 in the U.S. Its manufacturing cost is $225 per unit, with additional costs for shipping and other logistics.

What were the sales figures of the Burly Wagon?

The Burly Wagon has lifetime sales of $2.8 million. In the 30 days prior to the pitch, they achieved $400,000 in gross sales after launching in the U.S. market.

What were the sharks' concerns about the Burly Wagon business?

The sharks were concerned about the high operational and manufacturing costs, the complexity of the supply chain with 14 separate factories involved in production, and the challenges of scaling the business.

Why did some of the sharks opt out of the deal?

Several sharks decided not to invest because they believed that the operational challenges, including the high manufacturing costs and complexity of the supply chain, would make it difficult for the business to scale. Some also lacked the relevant expertise to address these challenges.

What offer did Davey make, and how did Reagan and Nathan respond?

Davey offered $450,000 for 30% equity in the business, along with a $4 royalty per unit sold until the initial investment was paid back. Reagan and Nathan countered with 25% equity and agreed to the royalty terms.

What was the final deal that Reagan and Nathan secured?

Reagan and Nathan secured a deal with Davey for $450,000 in exchange for 25% equity in the business and a $10 royalty per unit sold until the $450,000 was paid back.

What is the purpose of the investment that Reagan and Nathan sought?

The investment was primarily aimed at increasing stock levels ahead of the busy Christmas and summer seasons, as Reagan and Nathan had experienced issues with running out of stock during peak demand.

What are some of the operational challenges mentioned by the sharks during the pitch?

The sharks highlighted concerns about the complex supply chain involving 14 factories, high manufacturing costs, the difficulty of streamlining operations, and the challenges of scaling the business. They were particularly worried about the high cost of production and shipping impacting margins.