Dietitian-founded Be Fit Food upscales meal delivery for better health

Dietitian-founded Be Fit Food upscales meal delivery for better health

Be Fit Food co-founder Kate Save. 

From Youfoodz to Hellofresh the Australian prepared meal delivery industry is highly competitive, but dietitian-founded Be Fit Foods on Victoria's Mornington Peninsula has carved out a sizeable market share through its emphasis on scientifically-formulated weight loss programs that have had flow-on benefits for the health of customers around the country. 

Eschewing smoothies and supplements, the company founded by Kate Save focuses on wholefood diets with recipes addressing lifestyle health issues like diabetes, blood pressure, high cholesterol, fatty liver disease and weight management.

Be Fit Food has the potential to fill some of the void left by the liquidation of longstanding market incumbent Jenny Craig, and is on track to expanding its healthcare network and leveraging accreditation as a National Disability Insurance Scheme (NDIS) and home care services provider. 

Not only that, but the group has partnered with major health insurance providers including Medibank (ASX: MPL), nib (ASX: NHF), Bupa, HCF and more so that customers can receive rebates. The company also has partnerships major players and innovators in healthcare and health-tech, such as Diabetes Victoria, Bodymapp, Vively, Microba (ASX: MAP) and MyDNA.

At the retail level, its products are now stocked in more than 750 stores with its network including Woolworths, Priceline, Chemist Warehouse, Terry White Chemmart, Ritchies and IGA, while the company also delivers to 70 per cent of Australian postcodes.

These distribution channels helped deliver $6 million in sales last year, but founder Kate Save is now ready to take the business to the next level with a crowdfunding expressions of interest (EOI) campaign on VentureCrowd that will target $500,000 to $2 million to expand both here in Australia, but also abroad with the brand now registered in the US, the UK and China.

"We’re investing in a product that will change lives. We service 50,000 customers but in Australia alone we’ve got at least 15 million that need our help whether they know it or not, at some point if something goes wrong with their health, they’ll go looking for something and we want to help them," Save tells Business News Australia

"We’re really trying to change the way people see food. We want them to see food as the first medicine."

Be Fit Food has come far from its humble origins in 2014 when Save and her co-founder Dr Geoffrey Draper launched the healthy meal kit business from a tiny, shared kitchen space.

As an experienced accredited practising dietitian, exercise physiologist and diabetes educator, Save knew she had a product that could help masses of people improve their health, knowing that one in two people have at least one chronic health condition and that two in three people are overweight or obese in Australia.

She was determined that the idea was good enough to turn into a successful multimillion-dollar business, but the company was barely generating an average of $10,000 a month in sales.

Save had the idea to enter Shark TankAustralia in 2016 to give the business a boost but her business partner, Dr Geoffrey Draper, a lap band surgeon who helped develop the meals, discouraged her. Concerned about losing their contracts in hospitals and damaging their reputation, he thought it would be “career suicide”.

"We were spending hundreds of thousands of dollars building a food company and neither of us had real business acumen for understanding the world of products," she says.

"When it came to supply chain and logistics, we needed help, so that’s why I went on Shark Tank, against his will initially."

Everything changed when the show aired in August 2017 and they experienced exponential growth they weren’t prepared for.

"Our website, which had only about 100 visitors a week, suddenly had 1,000, 10,000, 60,000, all of them adding to the cart all at once," Save explains.

"Every four minutes our website crashed for about two to three weeks so we couldn’t even allow people on the site because it kept crashing. We weren’t prepared for how much people were looking for this solution."

The business escalated 1,500 per cent almost overnight and monthly sales cracked six figures.

“Within three months I scaled up the kitchen, scaled up logistics, scaled up my team from five people to 63 people in four weeks and learned how to run a business very quickly. I stopped working in my other company and just committed to doing this because I saw the size of the need," she says.

Be Fit Food was only selling one product then - a rapid weight loss box - and the production manager had only prepared 200 boxes at the time the episode aired, thinking Shark Tank wasn’t going to fly after waiting months for the show to air.

"He didn’t think it was going to work but that night we sold 2,500 in the first five minutes," Save says.

"We offered to refund everyone and 90 per cent of people said they would wait and didn’t want a refund, so they waited indefinitely for their food to arrive. At that point of time, we were only delivering in Victoria."

Within a year, Be Fit Food expanded delivery to other states along the east coast and South Australia, later expanding to Tasmania in 2020 and Far North Queensland in 2021.

When COVID happened, the company was hit by increased costs and logistics issues, and subsequentially reduced marketing spend and production.

"Unfortunately, once we hit COVID we started going backwards. No business plans to go backwards but we pulled back from our messaging,” she says.

“The cost of logistics went through the roof. It would have gone up by 30 per cent at least, on average, and the cost of fresh produce could double overnight. If there was a shortage of one particular vegetable, we would have to source it at astronomical costs to be able to produce it.”

Despite this setback, the business has managed to generate more than $31 million in revenue over the past five years, although the average revenue per year or growth rate has not been steady by any stretch.

"We’ve had some incredible ups and downs over the past five years in business with the positive effects of Shark Tank initially, followed by extensive PR and other media coverage,” Save notes.

"For the team, that has been something to celebrate their hard work. It’s so important for the team to validate that they’re doing a good job and that’s what those awards do. That gave the team acknowledgement of all their hard work."

Even though Save recognises the benefits of having a solid team around her, she scaled back to 15 staff and relies mostly on outsourcing.

"We outsource everything we can to experts because it becomes too expensive to have every single expert in the business," the founder says.

"That’s how our model changed during COVID, instead of having this huge team where we did it all ourselves, we outsourced everything we could to the best people."

The mother of two daughters set out a challenge to create a real food diet solution to tackle the obesity, diabetes and metabolism dysfunction epidemic that wasn’t intended to be a weight loss company, but rather a wholefood approach that was not in line with fad dieting.

Be Fit Food has sold three million meals and has helped its customers lose a combined total of 100 tonnes of body fat. On average, Be Fit Food customers lose 5.89kg in two weeks on the company’s metabolism reset program using scientifically formulated wholefood meals.

“All of our time, effort and money in the team we employ goes into the development side of the business because we want to make sure we’re building something that can change lives. Every dollar we’ve had has gone back into investing in the company,” she said.

To date, the founders have bootstrapped the business. For the first time, the company is looking to crowdfund, with a focus on generating funds for marketing spend.

"My reason for choosing crowdfunding over one investor is because the crowd understands the vision and they can see what I can see," she says. 

“I know now that we need a real marketing boost to create a wider brand awareness so we can be found more easily online given the ever-increasing competition in the healthy meals space.

"We decided against all odds to do the right thing by the customer knowing that builds loyalty over time. That is the biggest bonus we’ve seen. Our customer loyalty has doubled over the last four years."

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