Innovative business: Biodegradable diapers

The Graham-Nyes had been running a small event-planning shop in Sydney, Australia. Hoping to score some swag for the impending arrival of their son, they stopped by a baby expo in the city.

There they happened upon the Eenee Eco Nappy, a newfangled diaper marketed as both flushable and biodegradable. Almost immediately, they knew they had something. The diapers had been designed by a Tasmanian biochemist who--without any real marketing or distribution--had built a profitable business.

The couple rounded up six angel investors and bought the worldwide rights (excluding Australia and New Zealand). They renamed it the gDiaper and set up shop in Portland, Oregon, a hub for green businesses.

(Not so) cutting edge

The gDiapers may be innovative but they're hardly high tech. They consist of a washable cotton elastine outer pant and an insert made of fluffed wood pulp and viscose rayon, both of which are harvested from trees certified by the Sustainable Forestry Initiative.

The insert, which contains neither elemental chlorine nor dioxin, can be chucked, flushed, or composted and takes just 50 to 150 days to biodegrade.

Organic growth

Diapers in hand, the couple approached New Seasons, a Portland-based supermarket chain that stocks green consumer products and has a reputation as a testing ground for chains such as Whole Foods and Wild Oats.

The couple knew that if they could get gDiapers into New Seasons, those bigger chains would follow. By the fall of 2006, they were in Whole Foods nationwide. A case of 160 gDiaper refills retails for $52, compared with about $40 for the same number of disposables.

The pants--you need about four pairs--are $16.99 each. But people are willing to buy. In 2006, gDiapers generated $1 million in revenue. This year, the Graham-Nyes expect to double that.

Welcome to the landfill

Most disposable diapers-- Pampers, Huggies, and the like--are made of plastic. Then they're bleached with chlorine, which releases dioxin, a toxic byproduct and known carcinogen.

Meanwhile, makers of disposable diapers use an estimated 250,000 trees a year to produce cellulose, the ingredient that draws liquid to the center of the diaper.

Finally, once it's used, each disposable diaper takes up to 500 years to decompose in a landfill. Yet 95 percent of parents use them. At an average of 5,000 to 8,000 diapers per child, the cost to future generations adds up.

The pant

Part of revamping the brand for American audiences included updating the design of the pants, which come in bright colors such as "giggle pink," "global blue," or "golden orange."

Says Jason: "We're at this stage in sustainability where parents are not going to put up with crunchy fashion. They love putting their kids in something fashionable."

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