‘A real fresh food brand that didn’t exist yet’

Only in 2019 did Tom Peeters, Michiel Roodenburg and Eric Klaassen go live with Crisp, the online delivery company of fresh and local food and other groceries, with which they challenge the established supermarkets. Their fresh supermarket is now so well known and successful that you’d think Crisp has been around much longer.

But really: it was only this year that the fast-growing super had enough of a track record to end up on the Challenger50, the annual list of the most challenging companies. And the prices? There was almost no escape from that. Peeters came, opened, and the big, ugly cup was for Crisp.

A crown of hard buffalo during the 4 years since he and his co-founders registered Crisp with the Chamber of Commerce in 2018. And a confirmation that they are on the right track with their model, with which they succeed every day in delivering meat, vegetables and dairy products from around 800 suppliers to thousands of customers’ doorsteps, they call it ‘crazy fresh’.

Has the jury given you a hard time yet?

“It may sound strange, but of course it was primarily about how Crisp’s model works, and we are used to that. The advantage is that we have a very logical story, what we are doing is correct. Only: it’s not that easy to do what we do: use technology to match the supply of 800 suppliers with the demand every day.’

Yes, my first question would be: are you an IT company or a supermarket?

“It depends on who you ask at Crisp. We are primarily a food company, but you could also see us as a logistics company. Only: we couldn’t do all this without our own technology. The technology we build sets us apart from the rest and will still make us relevant 20, 30 or 40 years from now.’

And then you are also a brand

“We built our brand from day one. While in our early days outsiders often said: ‘Go build your business first’. But we knew: the brand is the business. That’s why we designed everything in-house, the photography, the app, the packaging, what the box and our cans look like.’

“The interesting thing is that we have built a real brand in the world of fresh food. It didn’t exist yet. There are many brands of non-perishable or processed products, but there are not 10 brands of lettuce, cucumber, bread, meat or fish.’
“You can now also see that the brand – the trusted place to buy food – is increasingly appearing and being pointed to as something that makes Crisp distinctive. That is one of the reasons why people come to shop with us.’

You have really come a long way in a short time. Has growth overtaken you?

“It turned out as we hoped it would from the start. If you consistently build a brand, and you do it with a highly relevant product, then it is ‘only’ a matter of time before it rises to the surface.’

You are betting on the trend of fresh and local food. Did you see that trend coming 4 years ago?

‘Very clear. Even before corona, you already had the two very big trends that we are reacting to. The first is the change in how people act. This is switching from offline to online based on a need for more convenience. It started with books, travel and later followed by electronics and fashion, but a very large category lagged behind for a long time: daily shopping. That too is changing now.’

“At the same time, there is a shift in what people buy within our category. It has shifted from: products from nearby rather than far away, from fresh rather than long-lasting and from a transparent source to something that it is unclear what it contains. We are building a company at the intersection of these two trends. And we did that at the right time of the S-curve.’

It sounds like it almost came naturally. Did something happen along the way?

‘The answer is a bit boring: The model works exactly as we thought it would. The bottom line is: if you want to deliver quality food, you need to build a brand, and technology is needed to organize it. And that has to be managed centrally. We came up with that at the start, and that’s how it still works.’

‘Yes, no one saw corona coming. At most it has accelerated and created challenges, but it hasn’t made us build another company. The same applies now: Energy prices are rising and transport is very expensive. We didn’t see that coming, but it actually shows the relevance of our model.’

We wondered: is Crisp really recession-proof?

‘The importance of good quality food remains as important in a recession as it increases. At most, accessibility and affordability will become more challenging because incomes will come under pressure. While our mission is to make better food available to more people. It shouldn’t be too expensive’.

“What helps with this is that we buy at the source: that way you have fewer intermediaries. And if you get food closer, you don’t have to travel such a long distance. It makes a difference in freshness, but nowadays also a lot in costs. And finally, we are sustainable right from the start throughout the entire chain. Our three distribution centers are new and energy efficient, which is also very nice now.’

But even then, it sounds expensive to buy from so many small suppliers instead of centrally from a few preferred suppliers.

‘If you were going to make it classic, yes. But technology is the answer to that. We order perishable products such as fish, meat and vegetables from our suppliers every evening at 10 p.m. At that moment I know exactly how much we need and I can also estimate it better in advance thanks to the data we collect.’

‘So we have all supply and demand in one place in our system. While in the classic model, fish await a buyer at 2,000 physical locations. If he doesn’t report, the fish spoils, and that’s included in the price. Now you can make food less perishable with additives or plastic packaging, but in my opinion it’s the other way around.’

Your selection isn’t super wide and deep, is it?

“We have 3,000 products compared to more than 20,000 in a large supermarket. We have a compact and relevant range for every day. An example: we have 2 types of eggs. In virtually all supermarkets in Europe, there are between 16 and 24 types of eggs. I refuse to believe that a consumer is asking for that. But that’s 24 places on the shelf, 24 purchase receipts, 24 types of packaging and 24 times estimated demand.’

‘We have just started with non-food products. It is only after 4 years. And not because we have a deep passion for toilet paper or hand soap, but because it makes us more complete and relieves people. So first we did the hard thing – eating fresh – and now we’re adding the easier products to the range.’

Less spoilage and minimal stocks therefore keep prices low

‘Yes, we also have negative working capital. In order to grow as a scaleup, we do not need to pre-finance stock: the whole model is therefore a kind of flywheel that locks into place and keeps turning.’

The trick is, and it’s the hard part, not to deviate from the setup. Stay disciplined. Don’t suddenly start delivering within 10 minutes, don’t suddenly add thousands of cosmetic items or expand to 6 countries. No: we are nicely expanding, step by step, this model.’

Yet you raised 75 million earlier this year. So where does this money go?

‘Out of stock, haha! Therefore we ‘only’ had to raise 75 million and not hundreds of millions. Our logistics centers cost less thanks to our compact range, but we need them. We went to Belgium, we took over a supplier of fresh meals, which we are scaling up further. And we have a large team, and as a company we are not yet profitable.’

No profit yet, you’re keeping the turnover down, right? Twinkle put you at 190 million in 2021

“We never talk about how big we are. I can only say that our app has now been downloaded 750,000 times and that customers are buying in a fixed pattern. An average order is 85 euros and consists of 40 products. Today’s orders are about twice as many as last year, so we’ve doubled over the last 12 months. In a year when the sector is shrinking, we are still experiencing strong growth.’

Harder than the market. Does he see you as a challenger?

“It’s inherent in what we do: we sell food, and before we existed, everyone was already eating. So, ultimately, everyone who now buys groceries from us used to do it elsewhere.”

‘Well, it’s the biggest market in the world if you look at what people spend their money on. We are fishing in a gigantic pond, but the customers do not come from other online providers, nor from the baker or the butcher. They mainly come from the big supermarkets’.

And of course Picnic was a good example as an app-based super

‘Sure. Funny: when we started, many people said: there is already a supermarket with an app. But we don’t think having an app in itself makes the decisive difference. It’s about what kind of app it is and how the model behind it works’.

And what kind of customers do you really attract?

“These are busy families, young couples without children or people whose children have already moved away from home. More than half live outside the Randstad, so in that respect it is roughly the same as the population of the Netherlands. And 75 percent of the customers live in a house with a WOZ value of less than 400,000 euros. It is remarkably mid-market.’

‘But we don’t build a store for everyone. If you always grab all your kilos of pork steaks from the bottom shelf, Crisp probably doesn’t make you happy and that’s okay. But the corner we represent is expanding. The consumer is moving towards the model we are building. We don’t have to follow the customer, we build something that is relevant for the future.’

Crisp’s huge success: don’t you live as an entrepreneur?

‘I don’t immediately respond to everything and everyone who calls us. I stay focused on what matters. Regardless of whether it is business or private. I like to eat with my family, we now have this conversation a little later because I put the kids to bed. This is important.’

‘We build our brand very consistently, what this company will look like in 20, 30 years. It brings peace. And thus you can also make a difference. I think thinking and acting long term is a competitive advantage these days. Almost the entire world around you is driven by short-term actions. It gives your company a certain calmness and impact, so that you are not caught up in all possible changes, but can stay on your chosen course.’

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