Diaper Business Does Well In Down Economy

Crystal White has a booming business selling cloth diapers, in part because of the way she sells them: diaper parties. Similar to Tupperware parties, parents can touch, see and feel the diapers as well as learn how to get over the "ick" factor. White can also thank consumer belt-tightening from the recession for renewed interest in cloth. But the down economy has made it harder for her to grow her business in other ways.

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RENEE MONTAGNE, host:

As Americans continue to tighten their budget, they've found some old-fashioned ways to cut costs, like using cloth diapers instead of disposable ones. A company called Everything Birth offers diaper parties to convince parents that cloth diapers aren't as icky as they might think. They even offer stylish designs. Everything Birth is one of the fastest growing suppliers of cloth. But as Patty Wight reports, it's finding it hard to get a loan to expand that small company further.

PATTY WIGHT: The cloth diapers of today have a lot going for them.�In are Velcro and snaps, out are finger-pricking pins.�In are a snug fit and dozens of cute styles, out is the bulky white blob. But one enduring question remains:

Ms. CHRISTY REED (Everything Birth): The first question I always get is what do you do about the poop. What do you do about the poop?

WIGHT: That's Christy Reed.�She's one of 75 diaper party reps across the country for the Maine-based birthing supply company Everything Birth.�

Today she's at a party in Augusta, Maine for nine friends with about as many babies and toddlers in tow.�Some are here as cloth diaper enthusiasts.�Others use disposables, like Shannon Ferran.�She's pregnant with her second baby and says she needs a boost of confidence to make the switch.��

Ms. SHANNON FERRAN: My fears are how time-consuming is it, and cleaning them, and will my husband be able to use them? That's a huge fear of mine as well.

WIGHT: First, Reed highlights one of cloth's best selling points: cost. To cloth diaper one baby from birth to potty, it'll put you back around $500 if you wash the diapers yourself.�You'll spend around $2,500 if you go with disposables.�Those savings are creating a new demand that reaches beyond cloth's environmental appeal.�

Ms. CRYSTAL WHITE (Everything Birth): I'm definitely finding we're getting contacted more by people who wouldn't have necessarily even used cloth, but did because of financial reasons.

WIGHT: Crystal White runs Everything Birth out of her home in Falmouth, Maine. Her garage warehouse is an obstacle course of baby supply boxes.��

Ms. WHITE: It's just - in one year, this has exploded.

(Soundbite of phone ringing)

Let me just see if I need to grab that.

(Soundbite of phone ringing)

WIGHT: White started diaper parties five years ago after customers lamented a lack of places to touch and feel cloth diapers firsthand. For four years, one party kit traveled across the country to curious parents and their friends.

Ms. WHITE: And then about a year ago, the phone was ringing, ringing, ringing.

WIGHT: Diaper parties got a mention in Parenting magazine, and suddenly, cloth was re-introduced to a more mainstream population.�What was cost-savings for consumers translated into booming business for White.�Last year, her cloth diaper sales grew 300 percent, and this year they're on track to grow even more.�

Do you think the recession has actually helped your business?

Ms. WHITE: I do. It's kind of crazy to say that, but yeah, it definitely has.

WIGHT: But the recession made it harder to expand in other ways.�Last summer, White tried to get a loan to move to a larger location.�She went to ten banks, and the only way she could get a loan was to put up personal collateral.�But after ten years of running a successful company, White didn't think she should need to do that.

Ms. WHITE: I went to, you know, the bank where I have my business account.�And I'm like, look, I've had my bank account with you all these years, there's never been a problem. You know, I had one banker who was very honest. He was just we don't risk on small businesses anymore. We just don't.

WIGHT: The cushion from the loan would have also allowed White to hire more staff and offer benefits. Right now she can only afford to hire contract workers.�Those plans will have to wait, while White funds the move herself. She's banking as much as she can from diaper parties.�

Unidentified Woman #1: So now the decision is Velcro or snaps?

Unidentified Woman #2: I know. That's a tough decision to make.

WIGHT: Most moms order at least a few diapers, including, Shannon Ferran.� She's sold on the economics.�It's that poop question she's still unsure about. Party rep Christy Reed assures it's as easy as a quick shake in the toilet and a pre-rinse setting on the washer.

For NPR news, I'm Patty Wight.

(Soundbite of music)

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