Are all the foods organic?

No – not all of them. Our partners are committed to using the best, natural products and processes (no pesticides, no preservatives or dyes, no ingredients you can't pronounce) – but that doesn’t always mean “certified organic.” Obtaining an organic certification is often unrealistic for a small scale producer considering the cost and time required to attain the label. We’ve found that “organic” is not necessarily the best measure for the quality and sustainability of a product line. We bring...

How does your pricing compare with the same (or most closely comparable) products at a grocery store?

We can beat Whole Foods pricing easy, maybe little higher than Kroger for comparable/ natural and organic products.

It sounds like there is a lot of 'customization' that you say makes your model successful - truck location, offerings that reflect the locale's culture, etc., plus different criteria for every city in which a permit is needed. Doesn't all this make the licensing less attractiv...

Our licensees/franchisees will have the ability to adapt the product offering to fit local preferences but the business model will be packaged in plug and play processes (bot vendor management system, turnkey truck design and build options, inventory prediction model, etc.) that will allow them to quickly launch and start generating revenue. The permitting/regulatory piece will require some additional support but we can build that into the licensing agreement.

I noticed you mentioned Whole Foods and the fact that you can beat their pricing. How does Amazon buying Whole Foods change that? A recent NYT article says "Amazon plans to lower some prices at Whole Foods". Given their delivery infrastructure, they will also probably be very ...

Adam, great question....Amazon buying Whole Foods indicates that the grocery industry is ready for disruption, and that some form of physical shopping will continue to play a role in the new grocery future (why else would they choose to buy 460 brick and mortar stores when they avoided it in every other industry they have disrupted). Cutting pricing at Whole Foods 15-20% will bring them back in line with the rest of the market (closer to our price point but not necessarily below it) and drive...

I know you talk about long term estimates for profit margins in your prepared questions. But, looking at your financial statements from 2016. It looks like your gross margins are currently negative? What is driving that? Are you discounting the prices below cost in order to ga...

COGS is key driver. During the 2016 concept tests we didn't buy enough volume to justify lower prices and often had to pick up directly from vendors which would normally deliver larger orders (already built into pricing). With additional trucks/scale we can start getting our COGS down to the ~65% target(industry average) and achieve gross margins of 35%-40%.

Grit Grocery

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Houston, TX

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