DURHAM, N.C. — Logic suggests that boutique lip balms, hand creams and shampoos that cost double competitors' brands would be among the first luxuries jettisoned by strapped shoppers these days.
But low-tech Burt's Bees is making money and advertising for more workers even here among the pines in North Carolina, a state with the nation's fifth-highest jobless rate.
Burt's Bees, which uses natural ingredients almost exclusively, has averaged 25% compounded growth each year since its founding 25 years ago, according to Chief Executive John Replogle. He says sales have doubled in the last three years. With 400 employees, the company has hired 30 people this year and intends to hire 30 more by December.
"We've been pretty much like a Swiss train here," Replogle said in the company's modern offices next to Research Triangle Park, the state's sprawling corporate technology center, where layoffs are rampant.
How does a quirky company founded by a reclusive beekeeper and a single mother -- rooted in a 1970s anti-corporate, granola ethos -- succeed when corporate titans nearby are struggling to survive?
Burt's Bees hit on its recession-proof formula years ago. It went natural before natural was cool. And it made specialty personal-care products before such items went mainstream.
No matter how bad the economy gets, "it's the small luxuries, the small indulgences, that people are reluctant to trade off," Replogle said.
The company touts itself as the nation's leading maker of natural personal-care products. Once limited to natural food stores in fringe markets, Burt's Bees is now sold in big-box stores nationwide (Wal-Mart, Target, etc.) and in 12 countries.
The company moved last weekend to a new corporate headquarters in downtown Durham three times the size of its former space.
Replogle says Burt's Bees is riding a dual wave: More and more consumers want products they think are good for them -- and for the environment. "We play in both those spaces," he said.
Replogle says internal company estimates show the household penetration rate for natural personal-care products was 6% five years ago. Today it's 12% and is projected to hit 25% in a few years.
More than 40% of Burt's Bees products contain 100% natural ingredients, the company says. For its entire line of 150 products, the figure is 99%, with a goal of 100% by 2011. Burt's Bees says it has never used harmful additives and embraces green technology.
