Fresh Prep invests in a zero-waste meal kit

The Vancouver company spent three years developing a packaging solution to address the category's use of single-use plastics.

Fresh Prep

For the last three years, a team of Fresh Prep engineers have worked on a solution that would place the Vancouver-based meal kit delivery company as an outlier in an industry heavily reliant on single-use plastic: the launch of a Zero Waste meal kit.

But as a smaller company with distribution across 20 municipalities throughout B.C.’s lower mainland, the Okanagan and Vancouver Island, it had to be mindful in how it allocated capital towards the project, says company co-founder and COO Husein Rahemtulla. For a number of years, it prioritized building a sustainable company over fueling expansion.

Now, almost exactly one year after the onset of a pandemic that has accelerated its growth, the company will finally start to benefit from those investments.

As of this month, the company began rolling out zero-waste kits for two of the ten recipes on its weekly menu, with plans to gradually transition the rest of the lineup between now and June – until its entire meal kit offering is zero-waste.

Since its founding in 2015, the company has delivered its kits in reusable and insulated cooler bags with ice packs that it would then collect for sanitation through its own fleet of delivery trucks. But each recipe was delivered in a branded paper bag containing plastic or paper packaging for each of the recipe’s ingredients, says Rahemtulla.

“When we look at packaging, there’s a lot of talk about the end of life and how we treat it at the end of life. But the real exciting innovation part of that is how we can extend that life as much as possible or not have an end of life.”

With the new zero-waste kits, pre-cut and pre-portioned ingredients are served in a single tray that can be cleaned in a dishwasher and returned to the company, at which point it is sanitized and reused in another kit. For food safety reasons, a handful of ingredients will continue to come in separate plastic packaging, which Fresh Prep will recycle for its customers. Rahemtulla says designing the tray (for which it currently has a patent pending) to fit and secure various cup sizes was the largest R&D challenge faced by its team of engineers.

Fresh Prep

The zero waste kits come at no additional cost to the customer, with meals ranging between $10 to $12.25 per serving.

“It was really important to us to ensure that this solution enabled our customers to live a sustainable lifestyle that didn’t come at an extra cost to them,” Rahemtulla says. “When you look at more sustainable options, you can sometimes price out lower-income consumers when you price them at a premium range.”

At the same time, he says it was imperative that the customer experience be equal to, or even more convenient, than the current experience. “There’s consumer demand for sustainability, but it has to be as convenient as something like Amazon, and it can’t come at a higher price if you want it to scale successfully. Otherwise, you have a niche solution for a small segment of the market.”

Beyond innovating to make its meal kits more sustainable, the company will continue recycling any remaining single-use plastics – such as the packaging for certain ingredients with a short shelf-life and for the items on its add-ons menu, which includes beverages, ready-to-eat-meals and other products from local businesses – through a collaboration with Urban Impact Recycling, a Vancouver-based recycling company.

The partnership helped divert more than 100,000 kg of soft plastic from landfills in 2019 alone, and although the program has been paused due to pandemic health and safety measures, Fresh Prep intends to bring it back sometime this year.

As with other meal kit and grocery delivery companies, the pandemic accelerated Fresh Prep’s growth. Since last year, it has hired more than 100 new employers across delivery, recipe development and engineering. It currently makes around 10,000 deliveries per week, and total basket sizes (including items from its add-ons offering) have steadily increased since March.

However, some of that early growth has started to level off in recent months, according to Rahemtulla. Overall, growth is currently in line with – but no longer exceeding – forecasts adjusted at the onset of the pandemic that reflected higher-than-expected demand at the time.

On the marketing side, Fresh Prep’s brand and growth strategy are led by VP of marketing Megan Smit, who leads a 12-person internal team and also has oversight of revenue and customer service. Driving customer acquisition, increasing basket sizes and improving churn and retention rates are a large focus of the team right now, Rahemtulla says, adding that the company’s B Corp certification plays a large role in the communications strategy.

According to the company, a focus on sustainability is cited as the main reason customers choose to stick with the brand.

“We make sure our customers are aware that we are a B Corp, that when they’re spending money with us and they have those values of sustainability and being a benefit to your community, that they’re putting their dollars in a good place,” he says.