Guy Schanschieff: I discovered gold in nappies

Ex-accountant Guy Schanschieff set up a nappy laundry service in 1992. Now his company, Bambino Mio, turns over £3m and has 42 distributors in 60 countries worldwide.

When Guy Schanschieff, 44, set up a nappy laundry service in 1992, he thought he would be the first in Britain. "But it turned out there were quite a few," says the Northamptonshire-born businessman, who came across the idea for the business on his travels across India and Australia. Worse, when he tried to sell the service at antenatal classes, "you might as well have stepped off a space ship. People thought you were mad." To succeed, he would need to change tack, fast.

The son of an accountant, Schanschieff delivered clean nappies and collected the dirty ones every week for five years in his Bedford Rascal van. But "even at its peak, we had just 300 customers paying £7 or £8 a week". So when a former customer set up her own business selling reusable nappies, but then changed her mind, Schanschieff moved quickly. He bought the business, Bambino Mio, and was up and running by 1997.

Schanschieff and his wife began advertising in baby magazines and approached baby shops to sell the product, made by an American company. A small outlet in Milton Keynes was the first to take him on. By 2000 they had made it into Babies R Us. Shortly afterwards, they cracked a £120,000 deal with Woolworths for a baby swim nappy. The product sold itself. "Parents can save £600-£700 across the time their child wears nappies. If they then have a second child, it's closer to £1,000, because they don't have to buy new ones."

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However, problems with the American firm they were distributing for meant the Woolworths order was threatened with a delay. Indeed, in 2001, the firm made a loss of £100,000 on sales of £700,000 and Schanschieff had to fly to China to sort out some serious problems with the manufacturer. "That sparked the end of the relationship with the company in the US," he says. It clearly couldn't cope with the volume of orders he was putting in: it was time for a change of tack.

"Although we'd started making products ourselves, we needed the full range under the Bambino name. So we went out and that's what we did." The company struck deals with Asian suppliers and manufacturers to make its products although now 30% of the firm's merchandise (which includes everything from reusable nappies to washing powder and wipes) come from Great Britain.

In 2003, Bambino Mio hit £1m in sales, as the company started selling overseas. The couple worked with Spanish parents they had met at a trade conference to launch the product in Spain, and soon after began moving into eastern Europe and Asia. "The product does very well in eastern Europe because of money saving and because it's a nice, Western branded product."

Turning over £3m, Bambino Mio now has 42 distributors in 60 countries worldwide. It will even be launching in China shortly. "When I think back, probably the worst place to set up a reusable nappies business would have been western Europe in the early 1990s. People thought of reusable nappies as things with pins collecting dust in the corner of a baby shop. But by starting in the toughest market, we got tougher."

Jody Clarke

Jody studied at the University of Limerick and she has been a senior writer for MoneyWeek for more than 15 years. Jody is experienced in interviewing, for example in her time she has dug into the lives of an ex-M15 agent and quirky business owners who have made millions. Jody’s other areas of expertise include advice on funds, stocks and house prices.