Environment right for nappy entrepreneur

The need for biodegradable nappies is growing, says Teresa Ooi. Former Stockholm lawyer Marlene Sandberg took a gamble when she chucked in her legal career to become an environmental entrepreneur. She had just had her second son and while on maternity leave read with horror that the average Swedish child used half a tonne of disposable nappies a year, all of which would end up in a landfill where they would take hundreds of years to break down. Worse still, the process would produce methane gas that contributed to the greenhouse effect.

With no previous experience in product development or manufacturing, Mrs Sandberg set about inventing a biodegradable nappy using pulp and cornstarch. In starting her small business, she also took on a highly competitive nappy market dominated by big multinationals.

"The industry was laughing at me in the beginning," Mrs Sandberg said. "Now, they are looking at me differently."

Today her company, Naty AB, produces nappies which are 70 per cent biodegradable and turns over E10 million ($17 million) a year, mostly in Europe. In Britain, Naty has cornered 4 per cent of the nappy market and her Nature Babycare nappies are sold at pharmacy Boots and Sainsbury, one of Britain's biggest supermarket chains. Last month, Mrs Sandberg's nappies arrived in Australia and are now sold at Coles, Kmart and Target at the same price as other big brands.

About 2.2 million nappies are used in Australia every day and about 145,000 cubic metres of dirty nappy waste are added to landfills around the country every year - enough to fill the Melbourne Cricket Ground three times over.

In Australia for the first time to launch her nappies, Mrs Sandberg said that her products cost 30 per cent more to make than the regular nappies which were only a fifth biodegradable.

"Although it costs us more to make our nappies, we are still selling them at the same price as the big brands," she said.

"We are also giving retailers who stock our products a bigger margin. This is the only way we can break into the market." Mrs Sandberg has the largest shareholding in her company, with a 33 per cent stake.

The Swedish Industrial Foundation has 24 per cent and one of her earliest investors, Christer Zitterberg, a former managing director of Volvo, has 2 per cent. For the first nine years, her company lost money before it finally broke even in 2003. Last year, Naty made a net profit of more than E310,000. While the company has turned the corner, she said the beginning was exceptionally tough. "It took two long and painful years before we finally got the formula right.

"When I started I had to hand-make the nappies and my son was used as a guinea pig to try them out. It was an expensive, tough and complicated process. We faced a lot of problems." She had a lucky break when she met Mr Zitterberg, who had run a company involved in the nappy industry. His support was invaluable.

"There were so many problems and on bad days when I felt like giving up, he reassured me by telling me that a real entrepreneur would never give up, despite the hard work." Naty has now expanded its environmentally friendly hygiene products to include cotton buds, wet-wipes, panty liners, sanitary towels, breast pads and bandages.