When faced with problems like food waste and the rising cost of eating healthy, Jay Stegink turned to a solution that’s gaining traction in China: community buying.
In this practice, a community leader takes orders from members, then places one big order and distributes it within the community.
Stegink wondered if he could make that model work here and turn it into a business.
“It addresses a bunch of the traditional challenges,” he said.
One of those challenges is food waste.
“We have a massive waste problem in the food supply chain. Retail grocery stores and produce retailers throw out an incredible amount of produce every year. It’s avoidable food waste,” Stegink said.
A report by York Region in 2013 identified the main causes of food waste at the retail level. It said stores often throw out produce because of imperfections or not meeting a cosmetic standard, because they overestimated demand and have to discard the excess, or because it is nearing the “sell by” date.
The report also looked at food waste in the home, which it said is the most common place this happens, whether it's caused by preparing too much, not using food before it’s “best before” date, or not making use of leftovers.
According to the report, in 2012 the average annual cost of food waste per household in York Region was $1,125. The total annual cost for all households in York Region then was $378,335,250. The report projected this would increase.
A follow-up report from the region, released in 2020 said the average cost of food waste for all Canadian households was up to $1,500 annually.
According to Stegink, food waste at the retail level also ends up costing consumers.
“The customer ends up paying for this,” he said. “Customers end up paying for that waste because they mark up the prices to cover the cost.”
That’s where his new business, Value Fresh comes in.
“It’s a community focused, direct-to-consumer produce concept,” he said.
Value Fresh sends out a newsletter every Monday to subscribers highlighting what produce is available for purchase that week from farms or wholesalers. Stegink said it doesn't include everything shoppers would find at a grocery store, but they have 50 to 75 different items available each week.
Customers then go to the Value Fresh website to shop and place their produce order by 10 p.m. Tuesday. The Value Fresh team buys the produce on Wednesday and Thursday and the orders are delivered to the customers Thursday and Friday.
Stegink said by purchasing only what customers have already ordered, they don’t experience any excess product issues and their delivery model means they don’t have the overhead cost of running a store.
“We’re trying to create a new convenient way that combines the convenience of delivery with the cheaper prices you would find at a discount store,” Stegink said.
One of the main issues he said Value Fresh aims to tackle is affordability when it comes to healthy eating.
“We feel and see that it’s getting harder for families to prioritize eating healthy and unfortunately there’s a lot of less healthy food that ends up being cheaper than healthy fresh food,” he said. “So by doing this, we’re hoping we can help families continue to prioritize eating healthy while at the same time save a little bit of money.”
The company soft-launched just over a month ago with delivery available in Toronto and Barrie, and now they have launched the concept in Newmarket, Aurora, King City, Richmond Hill and Vaughan.
“So far the reception has been really good,” Stegink said. “The model is working and we are able to get people produce a lot cheaper than they would typically pay at the store.”
He said so far they have had a number of returning shoppers with 65 per cent of customers placing more than three orders. However, there is no commitment.
“There are a lot of solutions out there that are subscription based, which is great for the business… but here there are no commitments,” Stegink said. “You don’t like the deals, you don’t need produce, you can’t afford it, there's no pressure to buy whatsoever.”
He said to encourage more customers to join, Value Fresh is also offering a discount of 25 per cent off on their first order for new customers who sign up for the email newsletters on their website.