A premium product and a tight budget gave the Very Good Butchers a very good start. From the moment they launched at the Victoria Public Market in 2017, the company knew they needed to scale up. They had over 1,000 customers that day, and had to shut down for a week to restock. “We knew from almost day one, that we needed to scale up,” says CEO Mitchell Scott (pictured below) of the early days. “We’ve always produced as much as we can, and sold all of that still had people wanting more.”
Demand for a quality plant based product
“Customers are starting to take a closer look at what’s actually in the product,” says Scott of their premium plant based alternative to meat. “From the beginning, we wanted to have a very clean product using whole foods [beans, veggies, fruits, spices] and no preservatives. … Like the high quality meats that you’d find in a butcher shop”
The company bootstrapped through the early years. “For the first couple of years our cash was pretty tight. We didn’t really have the capital required to invest heavily in scaling up our production,” says Scott. With a 4,000 square foot production facility and a popular city storefront, online sales curtailed at 1,000 boxes a week because the company didn’t have the production capacity to fill more orders. Shipping everything out of Victoria was expensive and inefficient. Transitioning to third party logistics providers enabled them to ship pallets instead.
Raising capital to scale up across North America
A few months ago the company went public and raised the money required for a scale up that would meet their ambition to make their products available in every city and town in North America. They were already working with PSC Natural Foods on the Island and Canadian Choice Wholesalers out of Vancouver, and have now signed a deal with the wholesale distributor UPFI Canada, chosen for their broad reach across the East Coast. This upscale will see two additional production facilities in Vancouver and Patterson, California, to meet the increased demand, with distribution centres on either coast of both Canada and the US.
The company’s agreement with Canaccord Genuity Corp. raises $10 million dollars to build out the Rupert Facility in Vancouver. It will provide 45,000 square feet of production, refrigeration, warehousing, R&D and office space. The new facility’s production capacity will be up to 37,000,000 lbs per year – a 2690% increase over the Victoria facility’s output.
There is a waiting list of grocery stores that want to carry their product. “What’s driving this is a ton of interest in the plant based sector,” adds Scott. More and more people are eating less meat, seriously looking at plant based meats.” With the expansion the company will meet demands for a growing wholesale department that accounts for 70% of their production – up from a previous 20% – and supplying to 50 more wholesale partners.
“Our big goal for this next kind one or two years is North America. So that’s an expanded wholesale presence and an expanded e-commerce across North America. After that we’d love to go global.” To do that they would take a similar local approach by setting up flagship stores, e-commerce and manufacturing in Europe and Asia.