Meal-kit giant Goodfood to hire 200 workers in Ottawa amid move into grocery-delivery space

Goodfood stock image

One of Canada’s biggest meal-kit providers says it plans to hire hundreds of workers in the Ottawa region in its bid to take a bite out of the burgeoning grocery delivery business.

Goodfood announced last week it has launched a one-hour grocery delivery service in the capital. The Montreal-based firm says its drivers are now shipping “high-quality grocery items and everyday staples” to local customers from a new 7,000-square-foot fulfilment centre in the city’s southwest end. 

The company says the facility, which cost more than $10 million to outfit, is equipped with the latest automation technology to streamline the order-filling process and make deliveries more efficient. 

Goodfood CEO Jonathan Ferrari told OBJ the company plans to keep adding more warehouses in “strategically located” parts of the capital as it aims to ensure that no driver has to travel more than five kilometres to deliver goods to a customer’s door. 

“Ottawa has actually one of Goodfood’s best markets on the meal-kit side,” he said. “Our customers there have been really vibrant. They’ve built a cult-like following around our brand and our products, so we felt that it would be one of the most receptive markets for us to launch our on-demand deliveries in. So far, the feedback has been overwhelming.”

Ferrari said the firm expects to create more than 200 jobs in the region, including warehouse employees, drivers and supply-chain experts. 

Ottawa is the third market in Canada in which Goodfood is offering the new service after Toronto and Montreal. The move comes as the company tries to gain a foothold in the growing grocery delivery market, which Goodfood expects to account for a bigger share of Canada’s $140-billion grocery industry in the years ahead.

In recent financial documents, the company said that while the online orders currently account for less than 10 per cent of all grocery sales in Canada, it’s predicting that share could soon grow to 20 per cent, resulting in a potential market opportunity of as much as $30 billion annually.

Launched in 2014, Goodfood went public on the Toronto Stock Exchange in 2017 and has become one of the country’s leading suppliers of ready-made meal kits. 

Net sales down

Like competitors HelloFresh and others, it saw its revenues soar early in the pandemic as restaurants were shuttered and demand for its products soared.

Goodfood’s customer base grew from 200,000 in the fall of 2019 to 320,000 in February 2021 at the height of the meal-kit boom. But it fell back to about 255,000 by the end of last year as the economy began to reopen, and Goodfood’s net sales for the first quarter of fiscal 2022 dropped by 15 per cent compared with a year earlier while its net losses jumped from $3 million to more than $21 million.

Ferrari said the company sees a bright future for the grocery delivery side of the business, with plans to grow its number of fulfilment centres from six at the end of this month to as many as 20 by the close of 2022. And he expects Ottawa to be a big part of the story.

“We’re really seeing a lot of potential for us to grow the business in the Ottawa region,” he said.