Today we were able to report that the ready meal service Factor is launching on a broad front in Sweden. It is Hellofresh’s brand, which dominates the market in the US with a market share of almost 75 percent in its niche.
They have also started to gain a foothold in Europe and now the turn has come to Sweden and Denmark. A perhaps somewhat unexpected move, as the market for ready meals delivered to the door is very small here at home. But at Factor we see great opportunities, Christiane Schrijvers-von Griesheim, Co-Managing Director of Factor in Europe, tells Ehandel. Especially when you think you have some specific competitive advantages, which become important keys in the search for the top position in the country.
The convenience food market is small today, but we see great potential to grow and provide a new and better solution for Swedish consumers. The fact that the market is small today does not mean that there is no demand. It just means that the demand that exists for some reason cannot be met with today’s options. A challenge that no existing brand has so far been able to manage is the ability to scale up the preparation of ready meals and delivery directly to consumers’ doors in an efficient manner. And this is one of Factor’s distinguishing features, she says.
The successes and experience from other foreign markets have also paid off.
The convenience food market in the US has grown tremendously in recent years, and we have grown to become market leaders in other markets. A key driver behind this success was that we were able to leverage our experience from Hellofresh and quickly scale up to meet the increased demand.
And with Hellofresh, which had sales of just over SEK 2.1 billion in Sweden in 2022, already in place, you come prepared with a lot of lessons about Swedish consumers.
In addition, Swedish consumer behavior is one of the most developed in the world, with a high degree of adoption of online food solutions, such as meal bags. We understand that Swedish consumers value their time highly and understand the importance of nutritious and high-quality meals, so we believe the time is right for a service like Factor, says Christiane Schrijvers-von Griesheim.
“Establishes a whole new category”
When looking at Factor’s Swedish site, we can also see that the regular price tags are not of the lower kind. If you choose the package with 14 meals for a week, you have to pay SEK 1,589, or around SEK 110 per meal. If you choose the package with 8 meals in one week, the price lands at SEK 1,009, or SEK 120 per meal.
So here, too, you have a challenge ahead of you, as low prices often play a big role when the Swedish consumer chooses where to buy their food.
We must remember that we are establishing a completely new product category of high-quality ready-made meals direct to the consumer. We compete not only with established convenience food brands, but also with food delivery, takeaway and restaurants.
Here, Factor believes that in their category it is above all other factors that determine whether consumers jump on the bandwagon or not. Details such as saving time and reducing possible impulse purchases.
Our varied weekly menus, our commitment to high-quality ingredients and our efficient supply chain are what set us apart, compared to when you buy a ready meal at a grocery store on your way home from work. That purchase is often due to stress or impulse – you don’t have time to cook, or you’re too tired to cook.
“Offers something completely different”
The company therefore hopes that factors such as time saving and reduction of unplanned purchases will be
Factor offers something completely different, namely the ability to plan the week’s meals better and always have a fresh, nutritious meal at hand. When people get the chance to experience the Factor meals, I think they will feel that the added value they get is the most important thing.
At the same time, they seem to be willing to campaign properly to attract customers to try their service. Something that has also been the winning strategy in other markets to become an established player. And finally the first choice among consumers in the convenience food market.
What is the long-term goal here?
The medium-term ambition is to be the market leader in ready meals in Sweden. And as part of this to adapt to meet the changing needs and preferences of consumers. This does not happen overnight. But it can happen if you have the right offer, which we have seen with Hellofresh. So we want to fill the gap and drive the development of ready meals in Sweden and for Factor to take the lead as market leader, says Christiane Schrijvers-von Griesheim.
