The meal-kit model
Take the Havelock North Fruit Company, which is capitalising on the fact that globally consumers say that their favourite snack food is fresh fruit (18%), with chocolate as a close second (15%).
HNFC has developed Rockit – a new variety of apple, which is not much bigger than a golf ball, a uniformly red colour, and sold ready-to- eat in a clear plastic tube.
The company supplies Rockit apples to 29 countries, including the US, China, Canada, Italy, the Middle East and Taiwan. It also supplies the prominent UK department store Marks & Spencer’s.
Rockit founder Phil Alison says the company has noticed a dramatic growth globally in the consumption and demand for healthy snacks.
“There has been an equal increase in people’s awareness as to what constitutes healthy eating and so- called healthy snacks [and what doesn’t]. In particular, muesli bars and processed foods with many preservatives and additives are under the spotlight.”
Snacks with all natural ingredients are rated very important by 45% of those surveyed in the Nielsen report. Consumers don’t want artificial flavours or colours (42%-44%) or genetically modified organisms (43%), and are also looking for caffeine-free (23%) and gluten-free (19%).
Alison says Rockit apples sell for “a significant premium” over a standard apple and the company is breaking in to new market segments daily, including food service, vending, and corporate services.
“We position it as a ‘high end snack’ product, targeted at health conscious consumers who want healthy snacks replacing processed foods.
The keys to the company’s high degree of success include product differentiation, strategic thinking, market knowledge, good supply chains, hard work, luck – and quite a lot of money, Alison says.
Having bought the rights to the small apple in 2010, Alison raised $17 million in 2012, mainly from angel investors, to boost production.
At the time, Alison had three hectares of land producing his apples; these days the company has 160 hectares producing fruit in New Zealand, 120 hectares under cultivation (where the trees are growing, but aren’t producing fruit yet), and more plantings planned, and further developments planned. The company has 31 licensees and about 1.3 million planted trees, including many in the Northern Hemisphere, meaning Rockit apples will be available globally all year round. Meanwhile, healthy meal delivery services are flourishing. The meal-kit model, in particular, is proving popular, where you pay for a box of food that arrives at your doorstep with pre-picked ingredients and recipes for every meal. You don’t have to shop or think about what you are going to have for dinner.
It’s early days for this sector and it’s hard to say how big it will get. The food industry firm Technomic predicts the meal-kit service segment will grow to between US$3 billion and $5 billion during the next ten years, based on current adoption rates.
In the US, the most widely used services are Blue Apron, which launched in 2012, raised $US58 million and delivers more than two million meals a month, and Plated, launched the same year, raised $21.6m and claims to be doing twice Blue Apron’s number.
Auckland-based My Food Bag, co-founded by former Telecom CEO Theresa Gattung, chaired by Saatchi & Saatchi boss Kevin Roberts, and with recipes created by former MasterChef winner Nadia Lim, is well-placed to take advantage of the meal-kit trend, at least in this part of the world. The company offers a weekly service delivering fresh ingredients and recipes for people to cook their own meals at home.
In two and a half years, and with Sydney and Melbourne added in July last year, My Food Bag has grown its customer base to 20,000 across Australia and New Zealand, delivering more than 7.5 million meals in nine cities. The company is worth $60m.
Co-founder Cecilia Robinson says its customers in Australia are similar to those in New Zealand – busy, working professionals who want to eat a healthy and delicious diet. While the company have no plans to expand outside Australasia, the Aussie market is proving to be a good one.
“The business [in Australia] has real momentum and is currently exceeding our growth targets. We have some fantastic suppliers and have built some great corporate relationships.”
Rockit’s tiny apples sell for
"a significant premium" over standard apples, and the company is breaking in to new market segments daily, including food service, vending, and corporate