- Online grocery company, Goodfood Market (TSX:FOOD) gained 26,000 new subscribers in 2020’s May quarter, a 44 per cent increase year-on-year
- The company now has 272,000 total active subscribers, as a result of increased demand caused by the COVID-19 pandemic
- Numbers grew in spite of a temporary reduction in delivery days during the period, which lasted for a few weeks
- However, Goodfood was able to offset impacts to its gross margin by controlling its marketing costs
- Goodfood Market (FOOD) is down 4.34 per cent and is trading at C$4.41 per share
Online grocery company, Goodfood Market (TSX:FOOD) gained 26,000 new subscribers in 2020’s May quarter, a 44 per cent increase year-on-year.
This brings the company’s total number of active subscribers to 272,000. Goodfood attributed this growth to the extraordinary market conditions caused by the ongoing COVID-19 pandemic.
In response to the virus, the company’s existing members made significantly more orders and in bigger basket sizes.
Subscriber numbers grew in spite of a temporary reduction in delivery days during the period, which lasted a few weeks. Goodfood curtailed delivery and reduced its customer acquisition spending, in order to better support its existing members.
As such, most new subscribers would have joined in the first month and last two weeks of 2020’s May quarter.
Goodfood’s CEO, Jonathan Ferrari, said the company is extremely happy with the solid subscriber growth.
“Western Canada continues to be an important driver of overall net additions, leveraging our new Vancouver facility.
“While maintaining all additional health and safety measures related to the pandemic, our operations are stable. With our new fulfillment centres in the GTA, we are well-positioned to accelerate our growth momentum,” he said.
However, Goodfood has admitted that COVID-19 has still taken a toll on its operations. The sudden, unexpected increase in demand created operational challenges and extra costs which impacted the company’s gross margin.
Still, Goodfood was able to offset some of these impacts, in part through its controlled marketing spend.
The company expects to capitalise on the growing trend of online grocery shopping, which has accompanied the COVID-19 pandemic.
Goodfood Market (FOOD) is down 4.34 per cent and is trading at C$4.41 per share at 2:06pm EDT.