Award-winning cloth nappy company collapses but finds new owner on Christmas Eve

A New South Wales cloth nappy company that was previously named NSW Small Business Exporter of the Year collapsed into voluntary administration on Christmas Eve but appears to have been saved by new owners.

The cloth nappies designed and manufactured by Itti Bitti, previously known as the Itty Bitty Nappy Co, have a cult following among parents and at one stage were sold in more the 25 countries.

According to a notice published by the Australian Securities and Investments Commission, Simon Thorn of PKF Lawler was appointed administrator of Itti Pty Ltd, formerly trading as the Itti Bitty Nappy Co, on December 24.

The first meeting of creditors was scheduled to take place in Newcastle on Thursday. While the Itti Bitti website is still online, no products are currently listed for sale.

But according to the Itti Bitti Facebook page, the company changed ownership on December 24.

“We are pleased to announce that itti has new ownership,” said a post on Christmas Eve.

“The itti team wishes to acknowledge the years of hard work and dedication shown by [founder] Sue [McLachlan] to create such an amazing brand and all its awesome products … We look forward to continuing to grow itti and the amazing range of products we offer.”

In a follow-up post on December 30, the company acknowledged customer concerns and said the new owners “have full intention to honour all outstanding pre-orders/vouchers/credits associated with the previous company”, while the new owners wrote to Facebook fans on January 6, saying the company will be back-up and running on January 12.

“As the new owners we have been deeply touched by the comments and posts by the itti followers and the genuine concerns expressed in those messages,” said the post, written by John, Lorraine and the itti team.

“To those of you affected by the liquidation of the previous company, we understand your frustration and our thanks go to you all for your patience and understanding. It is important to be known the itti staff who were corresponding with you until ‘that’ day had no prior knowledge of the events that were about to unfold and therefore remained under the assumption that the products had been delayed.”

“So much has happened since our involvement (Christmas Eve) with a lot of hard effort going towards achieving our goal and number one priority that being re-assured our customers and honour our commitment to supply all pre-ordered products as quickly as possible. Within three days we had made all outstanding supplier payments ensuring the pre-sales to be manufactured.”

But while the new owners offered customers who had ordered products before the collapse “an exclusive limited edition gift”, they said they were not in a position to refund any orders.

A spokesperson for Itti Bitti told SmartCompany the new owners are not currently in a position to comment but confirmed Itti Pitti Pty Ltd is in administration. 

The Itti Bitty Nappy Co was founded by Newcastle businesswoman Sue McLachlan from her dining room table in 2005. Originally selling cloth nappies, the company later expanded to include other baby products, including toys, baby carriers and teething jewellery.

According to the Itti Bitti website, within a few years, the company’s cloth nappies were being sold in more than 25 countries. In 2011, the company was named NSW Small Business Exporter of the Year and was a finalist in the 2011 Australian Export Awards. In 2012, it won an award for best modern cloth nappy brand at the Cloth Nappy Awards.

SmartCompany contacted PKF Lawler but did not receive a response prior to publication.

(Image sourced from company website)