October 11, 2021
Throughout the pandemic, food and beverage companies have weathered surges in demand, rapid fluctuations in consumer buying habits, and the complexities of the global supply chain. Without complete enterprise-wide visibility or collaboration, shifting gears and adapting to trends in the market can seem insurmountable.
How can you modernize to keep pace with the speed of consumer needs in today’s competitive market? We recently did a webinar with Mark Winter, CFO of My Food Bag, to hear how his company, a leading online meal kit provider in New Zealand, managed to improve business productivity, efficiently manage the growth of its business and navigate the pressures of the pandemic.
Here are some valuable takeaways from the webinar.
My Food Bag has experienced phenomenal growth over the past several years. What are some of the growth challenges that you’ve experienced?
It's often said that growth is like drinking from a fire hose, and you're trying to swallow as much as you possibly can. To a large extent, that's been our experience. Things like systems and processes and general organizational capabilities have been challenging as we've tried to keep up with that growth. Evolving from using Excel spreadsheets and Google Docs to using an end-to-end ERP and having the right level of capability—it’s like moving from jack of all trades to specific people with the right skill set to solve issues around the business and provide specific support.
Growing at such a speedy rate, what sort of challenges have you experienced in terms of ingredients and raw materials?
One of the principles My Food Bag was founded on is provenance and ensuring we source locally and support Kiwi businesses. So local sourcing, freshness, and organic ingredients are fundamental to our business, which we’re never willing to trade off. However, sourcing the freshest ingredients locally on a weekly basis can sometimes be quite a challenge. If you think about fish, for example, you can't go and place an order for fish six weeks in advance. We must work with the local fishermen every Thursday to identify what's caught to make sure that it's been caught in a sustainable manner, but also that it conforms with the food safety requirements we operate under.
With the global pandemic, how do you think social media trends have influenced your business?
Several trends were evolving before, but the pandemic accelerated them. Like dining at home as opposed to going out, and trends surrounding provenance such as supporting local businesses and supply chains. And then there’s the trend of healthy eating and eating with a purpose. Those would certainly be the things that come to mind.
About two years ago, plant-based diets got a lot of attention worldwide. There was a Netflix show called “The Game Changers”, it was a documentary that outlined the benefits of eating a plant-based diet. Then-prominent global chef, Jamie Oliver launched a plant-based cookbook, and we saw all this as a huge opportunity for us to leverage what we're really good at and provide a product that wasn't in the marketplace.
A lot of people have an idea of how to do plant-based, but to execute it week after week––going out and sourcing the ingredients, and then coming up with creative meal ideas each weeknight––proves to be a real challenge. We’re able to work with our chefs to come up with a plant-based offering which we put into the market, and we thought it would go okay. We were completely blown away with the demand that we saw off the back of that product. Not only did we see people trading up from existing parts of our portfolio, but we grew our customer base. We saw a huge amount of acquisition come flooding in as people suddenly realized that we had this offering. They were reading about it and seeing it on social media, and they wanted to be a part of it. It was a real success for us.
There's a new, more informed customer who demands more product information about food safety, compliance, and labelling. How do you manage this?
Food safety is always top of mind. Unfortunately, not a week goes by where somewhere in the world, there's a food safety issue. Or there's a product recall or some sort of incident that needs attention. It's immensely brand damaging, and it's very difficult to get those customers back. So, making sure that food safety is at the forefront, along with health and safety of our businesses’ approach to everything is at the heart of what we do.
One of the big changes that we've had around food safety has been leveraging the product lifecycle management solution that we put in, Infor PLM for Process. Historically, we were recording things like nutritional information and allergens with manual spreadsheets. Although it was effective to a point, there were still control deficiencies associated with it. What we have now is a recipe management system that has that information loaded within it and has certain controls and parameters that make sure that we comply with the food safety requirements expected of us.
A real example for us would be the gluten-free bag that we provide. This is a very popular bag particularly for people that prefer or require a gluten-free diet. Having absolute surety that the ingredients we provide are gluten free, and there are no issues that would lead to an allergy or sickness. Our customers really trust us with that. So having a strong system, and a real focus on food safety and quality is a big enabler and a good reason for customers who have so much trust in our brand.
How does My Food Bag continually innovate in this rapidly moving market? What have you done to foster that process?
Innovation or new product development is an important growth lever that complements marketing spend and other activities that we do. It continues to drive the growth that we're seeing today. For us, it's about tapping into a huge customer database, surveying those customers, getting instantaneous feedback about what they like and what they don't like. It's about segmenting out small cohorts of customers and running pilots and getting immediate feedback. We're a business that very much embraces a philosophy around fail fast. We like to get products out, survey, capture the learnings, and then decide whether to grow it or whether to terminate it. I can assure you that we've had plenty of things that have gone wrong for each one that's gone right.
Another thing that's important, is to constantly watch the industry and keep tracking the trends, as well as what your direct and indirect competitors are doing globally. The meal kit space worldwide consists of a huge amount of niche market operators in different markets, doing a variety of things. And just as I'm sure they're watching us, we're watching them every day, making sure that we understand what they're doing. We’re also looking at things like macro trends, and how these are evolving and appealing and reacting with certain customer bases.
How do you work with small suppliers who are growing fantastic, fresh, and lovely ingredients?
The small providers are very much our roots, and we make sure that we work with them in a collaborative partnership model. Small suppliers often don't have deep pockets and large bank accounts. So, making sure that we pay them in a timely manner on shorter payment terms is a good example of the type of thing we do as a partner. But most importantly, we share their brand, we’re proud of our suppliers we make our customers aware of who they are. We like to collaborate with small suppliers in our development kitchen. We get them to share their products and work with our chef and think about what innovative solutions we can create together to showcase their products and give our customers something special.
On any given week, we'll use around 80 suppliers, and the majority of those 80 suppliers are small and niche providers. Working with niche, high-quality suppliers is an important feature of what we do, and it helps us to differentiate ourselves.