This summer, the venture was launched with the goal of reaching a turnover of 10 million SEK during the first year. The business idea was based on buying large quantities of meat, butchering it themselves and then shipping it to consumers across the country in specially developed cooling packaging. As the last quarter of the year rolled in, orders really started to pick up. Sales increased by up to 1,000 percent from one month to the next.
However, the rapid growth was too much for the company's internal processes. Packing and butchering could not keep up, resulting in customers not receiving their goods, a total of 5 percent of customers have received their money back. At the same time, unpaid invoices began to accumulate with suppliers such as Postnord and Martin & Servera.
We failed to get everything together with the packing in the production we have today, says CEO Leo Brogren to Breakit.
Scrapping Post For New Logistics Choices
To manage the crisis, the company initially had to solve deliveries by driving the goods out themselves in rented trucks to reach customers. It quickly became clear that the original plan was too expensive and time-consuming. Now, the e-commerce retailer has pressed the pause button to completely restructure its business model. In short, they are moving from being a craft butcher to becoming a more traditional, large-scale e-commerce retailer acting as a reseller of finished premium products.
More specifically, the transition will take place on April 1st and will initiate a collaboration with home delivery operator Gordon Delivery.
At the same time, the company will stop butchering the meat themselves and instead switch to pre-packaged products directly from the producers, which is expected to shorten the handling time per order. However, the restructuring and previous delays have cost the company money, and they are now reviewing various financing options to be able to scale up.
We are in a difficult situation but we will get out of it. We will look at loan opportunities, the possibility of a new issue and capital raising. We are not shutting down, we are turning on the dashboard, says Leo Brogren.