GrubMarket: Farm(ers Markets) to Table

By Drew Hendricks April 10, 2015

Forget “urban farms”—that’s low-tech compared to the likes of GrubMarket, which delivers all the goods of a farmers market directly to your doorstep. In metros like Chicago, there’s not many sprawling farms or weekend outings where resident can pluck their own crops. However, that doesn’t mean the locavore movement is dead in highly populated areas. It just means farmers and shoppers have had to get a little more creative, and lean a little more on technology, to enjoy the exchange of local, organic, seasonal, and fresh produce and meats.

Launched in San Francisco, one of the startup hubs of the world, tech start-up GrubMarket is all about linking an online, e-commerce platform with “local food suppliers” whether that means an outlying farm or urban bee keepers dishing up raw honey.

This removes obstacles like “low seasons” or the sheer manpower necessary for farmers to set up stands every weekend at the physical market. GrubMarket took off with flying colors in California, and the expansion in December 2014 to Chicago is also off to a great start.

Food on Demand

You already get entertainment on demand, but now the emerging ease of delivery on demand has spread to food buying. Mike Xu, the founder of GrubMarket, stated “I am a big fan of local food and supporting local farms,” but he just wasn’t finding it as easy as it should be, especially in major metros. His solution was GrubMarket.

GrubMarket was picked up by San Francisco’s Y Combinator accelerator program, and so far has raised $2 million thanks to investors and the accelerator in less than one year. As for food suppliers, there are over 380 vendors in Chicago and San Francisco combined (most are currently in the Bay Area).

However, Xu is confident GrubMarket will flourish in Chicago, especially with his Midwestern connection. The University of Wisconsin at Madison is his alma mater, and there’s a smorgasbord of farmers markets, farmers, and food suppliers nearby. GrubMarket is particularly appealing to smaller suppliers since they’re often not able to sell good via traditional retail channels, and a direct to customer approach might be just what they need.

Currently, Xu is working on software to make the inventory process automated. “We need to manage the logistics and communication with vendors, local small farms. They need a lot of coordination with us and the buyers.

Putting Your Money Where Your Mouth Is

Since kick starting GrubMarket, Xu reports over $400,000 in food such as nuts, produce, meats, and cheese have been sold. Drivers contract directly with the company so that delivery is free for customers (however, there’s an option for vendors to charge for shipping, too). On the GrubMarket site, local food lovers can see a schedule of available products so there’s no wondering if those duck eggs are available.

Sharon Seleb, the general manager for the Midwest and Chicago, notes that Chicago users can purchase food from vendors around Indiana, Illinois, Michigan, and Wisconsin—far surpassing the reach available when visiting a physical farmers market. Vendors enjoy free photography of their goods and professional support from GrubMarket, while GrubMarket makes money by taking a percentage of gross revenue from sellers.

Now That’s Good Grub!

In addition to ordering exactly what they want, customers can also sign up for Grub Boxes, which include goods that are pre-selected and feature themes, like meats or cheese, and delivered regularly. The price varies depending on the content and size, but the California Fruit Bounty (for example) costs between $45-$65 depending on size selected. Seleb says, “Our customer is more educated, and they would understand the purpose of getting a certified organic apple versus the apple for 50 cents. In terms of price point, our prices will be more on par with a Whole Foods or a farmers market. They’re not cheap.”

This means most customers won’t use GrubMarket in place of going to the grocery store, but rather to supplement it. According to the Executive Vice President of food consulting firm Technomic, Darren Tristano, most people who use this service are likely wealthier and/or Millennials. Food shoppers want to spend their money to support local farmers and be eco-friendly, and values are shifting.

He says, “Traditionally it’s been around price and quantity, but the new consumer equation seems to be around where does it come from, how does it connect to my lifestyle, can I connect to this brand? Those things are all driving value to a Millennial consumer and to those who can, quite frankly, afford it.”

Plus, don’t forget about restaurants and chefs who are playing a role with these kinds of ventures. They also want local, fresh goods—and don’t have time to waste perusing farmers markets. Direct to chef or restaurant? Order up!




Edited by Stefania Viscusi
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