Toronto organic delivery company Fresh City Farms has acquired organic delivery pioneer Front Door Organics, in a move the company says will allow it to improve its food delivery in the Greater Toronto Area.
The combined entity will operate under the Fresh City banner and have about 5,000 customers.
“There’s basically a period of consolidation right now in the online space,” says Fresh City CEO and founder Ran Goel. “We felt that joining forces with their team and acquiring their customers made sense just to get a critical mass.”
One of the big challenges online for grocery delivery is the last mile and creating denser delivery routes goes a long way toward being successful, Goel says. Having a bigger company will also improve logistics and economies of scale for purchasing, he says.
Goel says the acquisition of Front Door “is very much a win for customers,” as the popularity of local organic fare grows.
“It will enable us to provide a wider selection of products. It’s going to be able to support the kind of overhead that’s required to provide a top-notch shopping experience online and customer service—all the things you need to really succeed in online.”
Launched in 1997 by Angela Donnelly and J.J. Sheppard, Front Door Organics was one of Toronto’s first organic delivery companies.
Donnelly will become chief financial officer of Fresh City, while Sheppard has decided to pursue other opportunities. Most Front Door employees will continue to work for Fresh City.
Founded in 2011, Fresh City farms in Toronto’s Downsview Park and sells much of what it grows. It also sources from more than 80 farmers and food makers across Ontario.
The company delivers produce bags with a selection of organic seasonal produce, but is increasingly offering recipe kits, vacuum-sealed ready-to-eat organic salad jars and smoothies. It is also launching other ready-to-eat products like soups and school lunch bags.
“It’s a very selective product line, so we’re not trying to supply 40,000 SKUs to anybody,” Goel says. Rather, Fresh City aims to address people’s needs as they try to eat healthier, he says.
Delivery is free for orders over $75 and to more than and 50 pickup locations, and about $3.50 otherwise.