How Delish Deliveries fixed its business and saved some Aussie Farmers Direct franchisees at the same time
Tuesday, July 31, 2018/
A Sydney-based grocery delivery business has swooped in to help a number of Aussie Farmer Direct franchisees after the company’s collapse earlier this year, despite nearly succumbing to the same fate years earlier.
Delish Deliveries was founded in 2009 by Claire and Jaeger Richmond, starting out as a humble fruit and veg box delivery service ran out of a garage and quickly adding more products to its delivery service. The business services just the Sydney region, and offers only fruit, vegetables, and various perishables as delivery.
Speaking to SmartCompany, the founders say they saw the opportunity to snap up some of the former Aussie Farmers Direct franchisees after the collapse of the business earlier this year. A number of other grocery delivery businesses, including FarmGate Online have reportedly been in talks with former franchisees, while YourGrocer purchased the Aussie Farmers Direct intellectual property in May.
Jaegar says Delish Deliveries had experienced similar issues to those that led to Aussie Farmers’ collapse but emerged from the experience stronger; the company used to offer a minimum order for free delivery of just $37, which was similar to Aussie Farmer’s minimum of $25, for example.
“We were having issues making a profit and servicing our clients across Sydney at that level, so we just ripped the band-aid off and changed our and changed our minimum to $69,” he says.
“We lost a substantial amount of clients, but we could go forward with a good growth model.”
With a stronger business in tow, the founders decided to reach out to seven former Aussie Farmers franchisees to offer them work with Delish Deliveries earlier this year. The two say they would have loved to get more on board, but with the limited space within Sydney they didn’t want to affect the delivery runs of their new or existing partners.
“We’re a much smaller business than Aussie Farmers Direct, so we’re cautious of taking on too much too quickly,” Claire says.
Delish Deliveries is also a very “hands-on” operation still, meaning the founders believe they aren’t in a position to run any satellite operations in other states just yet.
Where Aussie Farmers went wrong
Speaking from an outsider’s perspective, the Delish founders believe Aussie Farmers Direct went wrong as soon as each delivery stopped being profitable, with the bad business outweighing the good business.
“They were enlisting new franchisees all the time, while old franchisees were handing back the business. We were doing a similar thing to Aussie Farmers but a few years back we re-evaluated the business and decided to look at the bottom line rather than just chase more customers,” Jaeger says.
“It’s just not sustainable to do a minimum delivery that low.”
The two say the change was “100% worth it” and Delish Deliveries is now in a much stronger position. They aren’t worried about the supermarkets or big players like Amazon either, as they believe it’s exciting when new players enter the market.
“The majority of people still like to be hands-on when it comes to buying fruit and veg, so we think it’s exciting. It’s good to grow the idea, especially when you’re the one doing it the best,” Jaeger says.
Passionate about the state of Australian small business? Join the Smarts Collective and be a part of the conversation.
All that glitters is not gold: The upsurge of paid followers and engagement on LinkedIn Sue Parker DARE Group founder
Webcams and monitored bathroom breaks: Why employee monitoring is counter-productive Ian Whitworth Scene Change co-founder
Locked and uploaded: How to take bricks-and-mortar stores digital with video Michael Langdon Levity director
Why retailers have no idea about the future Dean Salakas The Party People chief
There's only one way to attract and retain millennial talent — but it'll cost you a few bricks Lauren Lowe Future Fitouts co-founder
Advice for going green, from one chief executive to another James Chin Moody Sendle co-founder