In 2019, Amazon’s Canadian-based third-party vendors have grossed US$2 billion+ in Amazon online storefronts. There are over 3 billion products sold annually by over 30,000 small and medium-sized businesses with Amazon stores, including plant-based public companies. The Very Good Food Company is going to be fully accessible to U.S. customers via Amazon by the end of June. The star offering is their proven and popular Butcher Boxes which include a number of their best sellers, including:
- Very Good Pepperoni,
- The Very British Banger,
- The Very Good Burger,
- Taco Stuff’er.
The launch on Amazon is lockstep with the ramp-up of production capacity at their production sites (including the Vancouver-based Rupert Facility). Remember United Natural Foods (UNFI)? They are the largest publicly traded wholesale distributor of healthy and specialty food in North America. VERY GOOD recently signed a new distribution agreement in May with UNFI, which will play a key role in VERY GOOD’s retail expansion efforts driving its growing presence in the U.S. plant-based foods industry..
“We are quickly executing on our North American expansion strategy and expect 2021 to be a banner year for our brands. We are building our Company based on customer demand, and customers want plant-based alternatives from a trusted eCommerce source,” said Mitchell Scott, Co-founder & CEO of The Very Good Food Company. “Being on the Amazon platform affords us the opportunity to boost sales growth by leveraging strong data analytics that allows us to test and validate new products, and thus better understand our customers’ needs. We are obsessed with our customers and value their feedback and are excited to get our products into more homes.”
A Very Good Diversification
No, it doesn’t stop there. On the heels of VERY GOOD’s upcoming launch into a US$2 trillion eCommerce channel, backed by America’s largest health food wholesale distributor, the bean butchers are also tapping into the Food Service Industry. FreshPrep is Vancouver’s premier meal kit service company. The global meal kit delivery services market clocked in at a value of US$10,260,000,000 in 2020, and at a compounded annual growth rate (CAGR) of 13.3%, that number is expected to nearly triple by 2028. Millennials are showing an increasing preference for homemade meals which proved to be a major factor contributing to the market’s growth.
“We have witnessed record growth and demand over the past several quarters for our expanding line of plant-based products,” said CEO Mitchell Scott. “Our team is focused on building upon this success by making our delicious and nutritious products more widely accessible to those rethinking their food choices. Fresh Prep shares our commitment to human health and the environment, and we are honored to be part of their creative meal preparations that go above and beyond traditional meal delivery services.”
FreshPrep takes sustainable-minded packaging to the next level with their signature Zero Waste Kit. This kit, at no additional cost to the consumer, eliminates 100% of the single-use plastic and silicon aspects of food and meal packaging.
“Single-use plastic is a well-known and pervasive problem in the food industry. As interest in meal kits continues to surge, we wanted to be leaders in innovating to minimize packaging waste,” said Fresh Prep co-founder and COO Husein Rahemtulla. “Since day one, we’ve experimented with innovative ways to make sustainability more accessible to our customers. We explored options such as mason jars and other packaging, but quickly realized that if we wanted to create a sustainable solution at a large scale, developing a reusable packaging solution that meets the needs of convenience and sustainability would be the best approach.”
Key products in VERY GOOD’s arsenal of innovative plant-based foods will be a part of Fresh Prep’s add-on menu, and will be marketed along with their BBQ kits and other summer grilling campaigns. One big selling point for the average person adapting to a plant-based food diet is taking exciting new ways to put together ingredients and laying them all out for the consumer. Plant-based meal kits are a proven gateway for people to reduce their environmental footprint and switch to a cruelty-free diet.
A Capital Option
Very Good has officially secured a credit facility for up to C$70,000,000 which provides them with increased flexibility in funding their rapid expansion efforts. This is an incredible achievement for investors, as this gives the company access to shareholder-friendly access to capital. This also marks a massive milestone for the Company, as VERY GOOD has now grown to a point in the business where they’re even able to attract a debt vehicle of this size. A proper balance of equity and debt financing is key to maintaining shareholder value, and a favorable weighted average cost of capital (WACC). The agreement terms for the loan involves a 9.95% annual interest rate on only the unpaid amount of advanced money. Capital not used will not cost Very Good any interest. The credit facility has a 2 year term,, and the company has the chance to add 12 months on mutually agreed upon terms and conditions. The deal also saw Very Good grant 225,000 warrants to the lender, with a strike price of $5.62/share, exercisable for a period of five years. Do the terms above confuse you a little? Get a refresher from our Options 101 piece.
“The closing of this Credit Facility is a key milestone and a testament of our ability to access favorable financing while diversifying our capital structure and we are very pleased to have the Waygar Capital team as a partner as we execute on our growth strategy”, said Mitchell Scott, CEO. “This Credit Facility provides us with funding to establish our operations in the US and will be used, in part, for the build-out of our California facility. We are pleased that Waygar Capital believes and supports our Company’s mission, products and strategy to want to be part of our future success.”
Disclaimer: Very Good has engaged Edge to provide Very Good with investor relations services, including the creation and distribution of this blog post. Edge receives payments from Very Good in connection with the provision of these IR services. Edge and its employees hold shares in Very Good.