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Tuesday, Jul 23, 2024

Carlsbad Grocery Bag Company Prepares to Scale

Business for Carlsbad-based Lotus Trolley Bag, a company that makes a sustainable and convenient alternative to plastic bags, has taken off after seeing growing demand for its products.

The bags that come with features like secure pockets for egg cartons and wine bottles and an insulated pocket for frozen foods, quickly became the top-selling reusable bag on Amazon, and are now sold in stores like Wegmans, Albertsons, Kroger, and TJ Maxx.

“We’ve gone from five employees to 17 employees in less than nine months,” said Farzan Dehmoubed co-founder and CEO of Lotus Trolley Bags. “We’re at the point where we’re seeing explosive growth, which is amazing as a small local startup, especially as it started as a husband and wife team.”

Founded in 2017, former marketer Farzan and his wife Jennifer Dehmoubed, a former schoolteacher, got the idea for Lotus Trolley Bag after frustration with all the plastic waste and plastic bags piling up in their house and cars.

Working as a team, they created the Lotus Trolley Bag system of four color-coded bags that fold out like an accordion on the shopping cart, which allows consumers to easily sort and pack groceries in half the time.

Having first-mover’s advantage in the space, sustainable bags has now become a popular trend among socially conscious shoppers. Today, it is a heavily competitive market but Lotus Trolley Bags is has solidified itself as one of the market leaders.

The set of four bags, including the insulated bag, typically retails for $29.99 in stores and are being sold on racks next to the checkout line.

Since launching in 2017, Lotus Trolley Bag has eliminated 414 million single-use plastic bags from distribution. Products are manufactured at a family-operated factory in China.

Targeting Mom Shoppers

The future of retail is all about convenience, said Dehmoubed. Self-checkout is quickly taking over more and more floor space at grocery stores, and as a result there is a decreased need for traditional bagging systems.

“No other bagging system does what our bags do. Our bag allows you to scan and organize as you shop. You can literally just walk right out of a store and everything is already packed and organized in your shopping cart,” he said.

Lotus Trolley Bag’s customers vary across the board, Dehmoubed said, but over the years their target customers have been primarily moms and families who value organization and sustainability. 

To date, the company has raised over $400,000 from friends and family. The investment came while the company was growing very quickly and needed to bring in more inventory. Shortly after, the company inked three major deals with retail giants Safeway and Kroger and Walmart, and has expanded from 500 stores to over 13,000 stores in less than a year. 

When the coronavirus hit, their online sales spiked by 20 percent, although due to numerous retailers being closed temporarily, its retail sales were slightly affected. Post-pandemic, research shows that sustainable, eco-friendly consumers will continue to double year-over-year, according to the company.

By 2021, the company projects revenue numbers will reach $7 million to $10 million in sales. Once that milestone is reached, the new aim is to bring in $20 million to $30 million in annual sales revenue.

Their latest product, named Produce Bags, ended up being an even a bigger success, with over 60 percent of its business now dedicated to produce bag manufacturing. The reusable produce option is now sold at stores including Kohls, Burlington, and Nordstrom Rack. 

The majority of its distribution is through retail, but it also generates significant sales from its Shopify website and Amazon as well, the company said.

Over 1400 Five-Star Reviews

Its goal is to get its product in as many hands as possible while spending zero money on paid advertising. Its customers become the company’s unofficial brand ambassador, promoting their brand when they use the product in public places.

Although there have been similar trolley bag systems in other countries for years, the couple believes their design is unique, and they hold a number of patents. In total, they hold seven in the U.S., two in the European Union, two in Canada, two in Australia, and two in Mexico. 

Lotus Trolley Bag currently has a 4.9-star rating on Amazon with more than 1400 five-star reviews. Looking ahead, the company is also expanding beyond the U.S., and has already launched in Canada, Mexico and Australia.

“We look to expand rapidly in the next year and a half. We’re looking for the right partners and potentially raising a little bit more in the next year to support the growth, inventory, as well as help us strategically scale,” said Dehmoubed. “We look to also expanding on the produce bag vertical, and really become the category kings in that market. At the end of the day, we want to be a leader with a sustainable brand.”


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