Marie Eve Prevost
Cofounder and Former CEO of MissFresh
Marie is the cofounder and Former CEO of MissFresh, a Canadian meal-kit provider that was acquired by Metro in 2017 and sold to Cookit in late 2019. The company competes with both HelloFresh and Goodfood and experimented with selling meal-kits inside Metro grocery stores during the partnership. Marie is now the CEO of Dovetail, a Dental Practice Management Software solution. Read moreView Profile Page
Disclaimer: This interview is for informational purposes only and should not be relied upon as a basis for investment decisions. In Practise is an independent publisher and all opinions expressed by guests are solely their own opinions and do not reflect the opinion of In Practise.
Marie, can you provide a short introduction to the founding story of MissFresh?
In 2014, I decided to pack my stuff and move to Australia because Canada is a very cold country. I visited my brother, who was living in Australia, and I fell in love and said, why am I waiting for my retirement to surf on the beach? Let me do this now. I literally packed six suitcases and hurried on over. I was couch surfing at my brother’s place, for a while. I had a nephew that I had never met and his partner was pregnant with their second child, and they were subscribed to a meal kit service.
When I arrived, it was the first time that I was introduced to a meal kit service; they didn’t exist at all in Canada. I was just amazed. I love to cook and if you told me, we’re going to cook something for you, it would have completely turned me off, but this was something different. You could cook your own meal and have different recipes every week. The concept really just appealed to workaholic young professionals and young families.
My brother and I both worked one building away from each other, in Pyrmont, Australia, and Google offices were in between. Every morning, we would take the ferry – because we lived in Manley – to go to Pyrmont and we would brainstorm ideas as to how we could make this happen. A year later, we moved back to Montreal – a bit reluctantly, due to the weather – but we just felt there was such a huge opportunity and we started MissFresh.
What was the range and the price point that you were offering?
We started really small, obviously. The difficulty in starting a meal kit company is creating that demand. When you start and you are dealing with suppliers, if you are buying a very small quantity of product, they won’t give you good prices and, therefore, you are obviously not making any margin whatsoever. It’s also difficult to source; you have to source stuff at the grocery store and stuff like that. We really started a basement operation, with three different recipes that would change every week. We evolved that, pretty quickly, to about seven per week.
The pricing point was $68 for three meals for two. That was the cheapest price that you could get.
Who were the suppliers you were mainly sourcing from?
At the beginning, the joyride of any entrepreneur is that you start and you’re banging on the door and you say, please could you give me this product for a reasonable price and everybody asks what your volume is. It’s dismal and they say, I’m not interested in selling to you and I’m not even going to return your phone calls or pay any attention whatsoever to you. It took some time to build sufficient volume. But what is cool about that is that, then, people start knocking at your door because they recognize that you do have a huge volume and then they want to become your main suppliers.
We were sourcing from various different suppliers. The difficulty in our industry is that the menus change on a weekly basis and, again, we’re locate in Quebec, Canada, where the weather isn’t always great and we’re sourcing certain products that often depend on other countries and importing those products; the availability and the pricing fluctuates a lot, so we had to have multiple suppliers.
Would you only choose suppliers that were relatively close to the facilities or would you go all around Canada to get the required ingredients?
Relatively close, yes. There is definitely a benefit in sourcing nearby and, also, consolidating your suppliers. Try to identify suppliers that have as many products as possible, so that you can manage the in and out of the warehouse facility more easily. That becomes a huge issue at some point, when you have so much traffic of a truck coming in, off-loading and leaving with the boxes that are ready to be delivered. Managing fewer suppliers is much easier. Also, it was easier just from an inventory management perspective, with the staff manipulating all those products. We would definitely choose local suppliers first and those that carried the biggest variety of products that we were looking to source.
Were these from the farmers or were they also distributors?
Both. Obviously, there are a lot of products, pantry-related items, where we wouldn’t need to work with the farmers. But there are huge farmers markets here that we had access to, that we could source from directly.
Don’t all the meal kit providers use the same suppliers? For example, Hello Fresh, Goodfood, MissFresh? Do they not end up just sourcing from the same places?
I would imagine so. We can talk a little bit about how I was a very surprised when we partnered with Metro, who is one of the largest grocers in Canada. Our assumption, in partnering with them, was that we would likely, through economies of scale, pay cheaper prices for our produce and products. That assumption was wrong. We were, in fact, paying less for a lot of our products than what Metro was sourcing, as a price. What I found out was, it works completely differently when you have such huge scale. They can’t afford to run out of tomatoes or other produce. They need to have a guaranteed supply, in order to fulfil the demand in their stores.
They buy at a fixed pricing, all year long, regardless of season and they need guaranteed supply, during the year, which is why they tend to overpay, as compared as to what we were doing in sourcing just in time and having the flexibility of sourcing just what was required on the menu, and publishing menus that were based on seasonality.
So really, you can be sourcing the fraction of the volume of a Metro, but actually paying much cheaper prices because Metro just can’t afford to not have produce on the shelf?
Exactly. There is a premium associated with having that guaranteed supply. That is the case for a lot of products with limited inventory. Even in the organic space, that’s even more true. There are fewer producers of organic products, unfortunately, so there is limited supply.