My Food Bag is launching an online shop so Kiwis can purchase products for nationwide delivery with no subscription. Photo / Supplied
My Food Bag is launching an online shop so Kiwis can purchase products for nationwide delivery with no subscription. Photo / Supplied
Meal kit provider My Food Bag is launching an online shop in time for Christmas, offering Kiwis care packages, ready-made meals and gift boxes available for nationwide delivery, as it looks to expand its customer base beyond its subscription service.
My Food Bag chief marketing officer Trish Whitwell said theexpansion was about setting the business up to capture a larger share of New Zealand’s online food market, estimated to be worth more than $1.3 billion a year.
“The shop opens up new opportunities for the business that aligns with our strategy to grow customers long term by offering greater convenience, flexibility and value.”
The business had curated food bundles to appeal to a wide range of Kiwis, including new parents and unwell people, alongside festive bundles for Christmas, she said.
Pricing starts at $64.99 for a classic ready-made meal bundle and grows to $299 for a large ready-made meal care package, which has eight items including an Italian beef lasagne. Nationwide delivery within 48 hours starts at $9.99.
To support the expansion the business has made substantial operational advancements.
Whitwell said it includes the implementation of Pick to Light at its Auckland and Christchurch distribution centres.
“My Food Bag Shop leverages these investments, driving additional revenue opportunities throughout the week, while further utilising its supply chain.”
She also hopes the initiative will help to “further champion” the business’s New Zealand suppliers.
An example of one of the many bundles available from My Food Bag as it grows its product platform to include gifts and care packages.
Business recovery
My Food Bag has been undergoing a recovery over recent years, after not paying a dividend in FY23 due to the cost of living deteriorating in the economic environment.
Chief executive Mark Winter said the business was focused on retaining customers after it took a 60% profit hit.
This year’s result showed more positive signs, as the business resumed paying dividends after a turnaround in its second-half earnings.
While the firm’s net profit was $6.0 million in the 2024 year to March, compared to $7.9m in 2023, the business achieved a second-half net profit of $3.5m compared to $2 million a year earlier, a 75% improvement.
For the year, the business’ revenue came to $162.2m, down 7.7%.
The company’s annual earnings before interest, tax, depreciation and amortisation was $16.0m, down from $18.2m in 2023.
Tough market
While only offering ready-made meals rather than individual items, the venture marks My Food Bag’s entry into a category with a spotted history.
Many other brands have tried entering the online food-retailing market to shake up New Zealand’s supermarket duopoly, but to no avail.
Last year, online grocery start-up Supie went into voluntary administration after key investors pulled out, with the business owing $3 million.
Founder Sarah Balle, sole director of the three companies in the Supie group, said the investor’s absence resulted in the business facing cashflow difficulties.
“While sales have rapidly grown over the last calendar year, recent growth has been lower than expected, and insufficient to provide the scale needed to operate profitably in what is a highly competitive industry.”
According to the liquidator’s report, the business had a lack of sales volume and scale to operate the business profitably.
Tom Raynel is a multimedia business journalist for the Herald, covering small business and retail.
