Munchery’s CEO on How Serving 100,000 Meals a Week Is Tough Business

Nov 13, 2017 | Stephen Jackson

In this economy of instantly availability, people still want to dabble in DIY. Make-your-own meal kits continue to be popular ways to assemble dinner, and there are numbers to prove it: A recent study found at-home meal kits make up a $5 billion industry.

Of course, not everyone is clamoring to be a half-baked Gordon Ramsay. But the market for fresh and relatively healthy food options is robust, and that’s where companies like Munchery step in.

Munchery is an online meal-delivery service that uses all-natural ingredients, the majority of which come from local sources in their four markets (Seattle, San Francisco, Los Angeles, and New York City). You hop online and schedule a meal to be delivered later that day, or later that week. Chefs then prepare the meal (cooked and all) and Munchery delivers it to wherever you are. Once it’s received, you heat it up up, et voila, dinner is served.

It’s a great idea, and Munchery wasn’t alone when it entered this space. But while other food delivery services like SpoonRocket and Bento have shuttered in recent years, Munchery is still alive and well — for the most part. Last year the company brought on a new President and CEO, James Beriker, in order to be better scale the business. And if Munchery’s persisting existence in a market fraught with peril is any indicator, he seems to be doing something right. In fact, today they deliver almost 100,000 entrees each week, and all four of their markets are now turning a profit.

To that end, I reached out to Beriker to pick his brain a bit and see if he could provide any insights to small businesses who are just getting off the ground.

Beriker has a background in law, but has has been working as an entrepreneur since he started Search123 — one of the first performance-based search engines — in the late ‘90s. He’s since been CEO at five different startups, most recently at San Francisco-based job search tool SimplyHired.

What follows are some highlights from our conversation. Enjoy!

The Science of Keeping it Simple

Beriker was brought aboard at Munchery to take the business to the next level, and that’s what he set out to do from the moment he got there. “A lot of people try to do a lot of things all at once, and of my key strategies was to focus the team on a discrete set of priorities so that we could be successful,” he says. “That was something I did right out of the gate. I really focused on one or two things that we could all work on that would benefit our customers and our business… you need to have a ruthless prioritization of what to focus on in order to actually drive results, versus diluting your efforts across many things.”

A Product-First Mentality, with the Customer in Mind

“Whatever business you’re in, whether it’s a service business or if you’re making something and selling it, you have to start by making sure you have the right level of quality and consistency across everything you’re producing, or all the services you’re providing,” Beriker says, adding that it’s also important to intimately understand who your customers are. “You can’t be all things to all people, so focus on the value you can drive to a discrete set of customers so you that you can drive brand loyalty.”

Control the Value Chain

Beriker says that one thing that sets Munchery apart from the competition is the fact that it directly controls each node in their value chain, meaning that they have ownership over customer acquisition, buying the food, developing the recipes, cooking the meals, packaging the food, and transporting the product.

“We control every piece of that, which gives us the opportunity to really drive the quality of the experience for our customers and to drive efficiency in everything that we do so that we can be profitable,” he says. “One of the reasons I joined Munchery is because we controlled so much of the value chain, I saw that this was the company in the food space that can absolutely be profitable at scale. Part of the innovation that enabled us to get to profitability had to do with process improvement versus tech, although there was obviously some technology that helped.”

Beriker explains that they looked into everything from their kitchen layouts to the way they sourced their food in order to make improvements in efficiency across the board. And while your fledgling operation might not be anywhere near the scale or complexity of serving 100,000 fresh meals a week in four major U.S. cities, there is certainly something to be said for having as much control as possible over every piece of your business.

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