This interview was extracted from Moneyweb.
The idea is to give small independent food producers and local farmers access to a wider market than they previously had access to, explains founder and CEO, Asher Stern.
NOMPU SIZIBA: It’s our SME special feature. Today we speak to a gentleman who set up a platform that brings together different players in the delivery of fresh food to the market, who tells us about the business model, how it works, and its impact. I’m joined on the line by Asher Stern, the founder and CEO of Buyfresh. Thanks very much, Asher, for joining us. Tell us about your business, Buyfresh. What’s it all about?
ASHER STERN: Hi, Nompu. Thank you so much for having me on the show and good evening to the Moneyweb listeners. Buyfresh is an online grocery-delivery service based in Cape Town. We started our business in November 2018, and we went to market with the idea of giving small independent food producers and local farmers access to a wider market than they previously had access to.
So, essentially, an independent retailer might be operating in a small retail space, and then often have limited marketing resources available.
Thereby Buyfresh will empower them and essentially give them a very wide access to market, and essentially give customers access to amazing products that they wouldn’t necessarily ordinarily find in a retail environment.
NOMPU SIZIBA: So how do you connect all of these people? Is it through technology?
ASHER STERN: We bought a supply chain from scratch, essentially. We go to the farmers, we vet them, we on-board them onto our system. And then we go through a process of loading photography of their products, so that the product actually looks as appetising and as best as possible. Essentially we merchandise and manage their inventory for them, and customers come onto Buyfresh and transact on our platform and create a basket of goods form over 1 500 different products, ranging from free-range meats to freshly caught fish and seafood, and artisanal breads. We’ve got a very wide range of goods we’ve kind of curated, and it’s all around exceptional quality and sustainably sourced products.
NOMPU SIZIBA: Of course “success” is a relative concept. But, since you started in November 2018, how successful has the concept been?
ASHER STERN: Prior to Covid, the grocery segments of e-commerce hadn’t received the same amount of traction that other segments had received. So, when we started our business, there wasn’t another business that looked like Buyfresh in the market. Still to this day there are very few that you would recognise as a key creditor for us. Essentially, a couple of businesses started doing lockdown and then tried to emulate some of the things that we’ve achieved. No one’s really been able to scale to the point that we have done.
If you look around the landscape prior to Covid, when we started our business, Checkers Sixty60, some of the other delivery apps that offered a distribution channel for existing retailers had just started at the same time as us. But our concept is completely different. We’ve gone about it in a completely different way, in actually building a retail brand from the ground up, where we vet every single product that comes through our supply chain. We pay a lot of attention to detail. Everything is kind of sourced with the idea of the customer in mind, to make sure that they are getting our best and freshest quality products on the day.
Literally, when you’re ordering on Buyfresh; we are basically receiving our orders from our customers, we’re kind of placing orders with our suppliers. We are literally picking the freshest stock, the freshest produce, the freshest fish that we can find and delivering it to our customers’ stores.
NOMPU SIZIBA: So in a perverse way, have you actually done quite well under the Covid-19 pandemic?
ASHER STERN: During lockdown, the movement of humans or people was very much restricted. So it was a natural kind of move for consumers to move to digital channels to procure goods. Our business did see a material lift in volumes during the Covid and lockdown period. I think the one thing that must be made clear is that this particular segment of the market has been buying for disruption. And the Covid event really helped to give customers that taste of online, especially for the grocery segment, which was very much underdeveloped before Covid-19 hit.
I think that ultimately there’s still a long way to go, and it’s super exciting. There’s so much opportunity and we’re really excited about what we’re doing and what we’re trying to provide to our customers.
NOMPU SIZIBA: Yes. So what’s the turnaround time in terms of if a customer sends an email through at seven o’clock in the morning, when would they get their fresh groceries?
ASHER STERN: The platform is unique. You can actually shop by your dietary and lifestyle needs. You can filter by things like halaal and kosher. We’ve actually got a registered warehouse that only packs halal orders, which is kind of an industry first. Not even the retailers are offering that to the Muslim and halal markets. And essentially we offer a next-day delivery to if you place an order before 12pm. Why this is important is that we literally are placing orders with our bakers, with our process, to make sure that you are getting the freshest product. There’s nothing sitting on our shelves or in our cold rooms. It’s a completely innovative model where you are actually getting the best products available from local markets and local producers.
NOMPU SIZIBA: What does that then mean from a price perspective?
ASHER STERN: Our prices are in line with leading retailers that have comparable products of the same quality.
NOMPU SIZIBA: Excellent. Now, you’re plugged into the whole ethos of conservation and caring about issues like climate change. I understand this philosophy also informs the way that you operate from basic things like your packaging. Just tell us about that.
ASHER STERN: We are the first retailer to completely take out plastic from packing fresh produce, fruits, seasonal vegetables, and things like that. Everything is packaged in biodegradable corn starch, which is an industry first. If you place an order on our site and you open your box, it’s a completely different experience from shopping on another leading retailer’s online platform, or walking into a store. We do our utmost to ensure that we’re reducing as much packaging, as much plastic, on the supply chain, which makes our brand and our promise and our values completely different from the existing retail landscape.
We kind of go a step further than that where, when we launched our business, we aligned with Food Forward SA, which is one of the leading, food aggregators in the country that helps to provide meals for hungry South Africans. They feed over 15 million South Africans every year via their beneficiaries. And every time you order on Buyfresh, we donate a meal to feed someone in one of these organisations.
NOMPU SIZIBA: Excellent. So, over time, given all the networks that you’ve created through the platform, how many jobs or livelihood opportunities do you think Buyfresh has managed to create?
ASHER STERN: Well, just in our business alone we have created about 15 different … opportunities from within our business. And we also use an outsource logistics partner, which helps us get the orders out to customers around our servicing area, which also benefits from our business being operational, to give them and the drivers, who are like Uber drivers, contract drivers in a way, where they deliver the products on our behalf.
NOMPU SIZIBA: Now, what are memorable recollections that you have, both good and bad, about the journey of keeping your business going?
ASHER STERN: I think the most important lesson I’ve learned from this business is the value of resilience and persistency. I think when it comes to food and it comes to logistics, customers are judging you on your last order. So you’re only as good as your last delivery, especially if you’re still trying to build a brand within the market and you’ve got big, scary competitors like some of the retail players. You really are as good as your last delivery. And I think from when you start, you have to kind of hit the ground running and you have to keep that tempo the entire time.
So I would say that resiliency and persistency are probably the two key values and lessons that I’ve learned throughout this journey. And we’ve really come such a long way from when we made our first delivery. The whole process is super-slick. Customers can select, if they want, substitute products on our checkout page. Everything is really customer-centric and you can shop by whether you want gluten-free products, whether you want free-range products, whether you want organic products, and you can customise the whole shopping experience, tailored exactly for how you want to shop.
NOMPU SIZIBA: Now, I understand that family businesses are quite resilient – or have been historically – and I understand that you set up this business with your father. Just tell us a little bit about how you came to establish this company.
ASHER STERN: My background is in private equity. I worked for a boutique private-equity firm, where we facilitated transactions from UK private-equity funds to raise capital for South African technology businesses. A lot of the businesses I covered were direct to consumer, and I saw an opportunity to kind of create a direct-to-consumer food business in South Africa, with my dad’s business in mind.
My dad’s business was supplying restaurants, hotels and caterers with high-quality meat and poultry products for the last 25 years in Cape Town, and the whole concept was derived from how he ran his business as a distribution business, rather than like a traditional butchery where you’d actually be processing the, we call it last-mile delivery, or value-adding processing that was going on, cutting whole slabs of sirloin into steaks, and just adding that kind of value to the customers.
I think that model was what resonated with me, and that’s where I saw the opportunity, because it allowed us to reduce the amount of stock that we needed to operate, as well as provide customers with the highest quality products on the day.
NOMPU SIZIBA: I don’t believe someone like you is satisfied with sticking with just the Western Cape area or the Cape Town area. Do you plan on advancing this concept to other parts of the country?
ASHER STERN: It’s the same thing. We’ve got one eye on January in Pretoria as our next market. The one thing that has governed our business is scalability, that we need to have a DC or a hub in each market that we operate. So, as soon as we kind of continue to prove our concept out a little bit more here in Cape Town, we’ve got an exciting new brand-refresh on the way, where we are kind of really re-imagining what Buyfresh is to our consumers, using all the data that we’ve accumulated for the last two years. And we’re going to be taking something really epic to the markets. And that is what will probably stay with us the next market that we operate in.
NOMPU SIZIBA; One last thing – what’s your advice to budding entrepreneurs about the ingredients of making their business ideas work? What’s the secret?
ASHER STERN: I think the secret is persistency and resilience.
Ultimately, as an entrepreneur, while you’re still standing you’re alive. If you fall down when you’re feeling defeated, that’s when it’s game over. I think the most important lesson that I can bestow or give to fellow young entrepreneurs is to keep fighting.
When you’re feeling down and feeling like something’s isn’t worth it, keep experimenting, keep trying, and eventually you will find something that’ll work and it will kind of work super well. It’s like having those small little victories that will accumulate to a much bigger victory in the longer term.
NOMPU SIZIBA: That was Asher Stern, the founder and CEO of Buyfresh.