By launching an online-only, curbside pickup model, the technology-driven startup says it will eliminate the inconveniences and unwanted fees of delivery service or bricks and clicks hybrids.
“The two biggest headaches we hear loud and clear from consumers are substitutions and hidden/unexpected fees,” Mike Sayles, founder and CEO at Fresh Street told Food Navigator-USA.
“They are tired of having their cherries replaced with cauliflower and then paying an upcharge for those items.”
The opening is set for March 18, less than six months after Fresh Street announced that it had raised $4 million from private investors and was building out a team of former Google, Amazon, Aldi, Walmart, Kraft Heinz and Uber employees.
Focus on the suburban family
The 11,000-square-foot facility – complete with warehouse and sorting areas – opens in Chicago’s North Park neighborhood. Fresh Street intends to expand to at least 10 more locations in the city’s suburban communities and has its eye on additional markets.
“Our plan is to focus on families living outside of downtown areas, a cohort often overlooked by other online grocery platforms,” Sayles said.
“The goal is to make life easier for growing families and cut down on the need to travel to multiple stores or use multiple online platforms to meet their grocery needs.”
Shoppers place orders online and select a 15-minute window for curbside pickup in as little as 30 minutes after ordering. To ensure the substitution-free guarantee, the inventory management system is tied to the website and mobile application, promising real time inventory without shoppers in store.
What’s in the warehouse
Fresh Street says it will offer 5,000 SKUs to cover the standard weekly grocery trip, including a focused assortment of national brands and curated local favorites like This Little Goat, Milk & Honey, Heywell Sparkling and Chicago French Press.
“We’ve taken a two-pronged approach to building our supplier relations: Strong, strategic relationships with distributors at the national level and symbiotic relationships with emerging brands and wholesale partners at the local level,” Sayles explained.
“Fresh Finds” will offer a selection of new brands each month, and the app is programmed to field shopper requests and recommendations.
The preference for pickup
According to analytics firm Brick Meets Click, online grocery sales in the U.S. jumped from $2 billion in August 2019 to $8.5 billion in January 2022. Its recent survey shows a strong preference for click and collect in the U.S. market, with the pickup segment growing its share of online sales to 45% in 2021, up 5% year on year.
And Sayles trusts that this trend will continue: “We envision a future where shopping for groceries in a store is an exception versus the norm,” he said.
“The next generation of consumers increasingly looks at grocery shopping as a chore, and Fresh Street will be well positioned to be a part of this evolving shopping journey.
Other food retailers including Aldi, Food4Less, Whole Foods and Walmart have also added pickup service in the Chicago area.