At Sprig, we are focused on a singular mission: to make it easy to get a delicious meal delivered to your door when you’re ready to eat. This hasn’t changed from day one, when we accepted our first orders via a combination of EventBrite and Google docs, and moved game pieces on a printed city map to track driver locations. Since then, we’ve evolved into a much more efficient end-to-end operation that’s both a food business and a logistics business -- both powered by technology. As we grow as a company in the broader on-demand space, I wanted to share some updates on how we plan to continue to fulfill this mission, and the thinking behind our decisions as we scale.
Today, we have a product people love and order on average once a week. We currently serve thousands of meals per day. Through increased improvements in efficiencies of our kitchen ops, we’ve decreased our costs per meal box by more than 22% over the past few months, and are now close to unit profitability in San Francisco. As we’ve continued to scale, we’ve realized that in order to keep up with demand and continue to uphold the high quality experience we’re committed to delivering to our users, we need to change the way we deliver our food on the back end.
The hardest businesses are often the ones most worth pursuing, and Sprig is both of these. Cooking and delivering real food is challenging, but it is the only way to make a positive impact on one of our country's most broken industries. To achieve that mission, our goal is to be the best food service out there. We are in a good position today but we know we can do better.
Overwhelmingly, the #1 piece of feedback we receive from our customers is that they want more variety, and more food options to choose from. We’ve fallen short here in recent months, and we’ve spent a lot of time reviewing every aspect of our model to see how we can solve for this going forward.
Our current delivery model is centered around using our predictive analytics to send our servers to different neighborhoods with a set number of each meal during a given time window. This is based on what meals we expect people to order when, and when this works well, the exact Sprig dish you wanted arrives to you within five minutes. When it does not work, a dish you may have wanted has sold out in the area nearest you and is not available. This leaves a user with fewer options than the 4-5 dishes she expected to choose from when opening the app.
To deliver the best possible experience for our users, we have learned that we need to ensure 1) there’s a dish option they want and 2) that it’s available in a reliable, reasonable time frame. These are critical to the long-term success of our business, and in order to achieve these and build the best path forward, we need to make significant operational changes to the back end of Sprig.
Over the coming weeks, we will begin testing and implementing a new logistics model that we believe will allow us to offer more options and better availability at the same price point. This will also allow for group ordering, which we’ve been quietly testing in recent weeks during the office lunch hour. More importantly, these changes will allow us to offer a larger number of different dishes, as well as an assortment of sides and other add-ons. You may have noticed in over the past two weeks, we’ve increased the menu to 8-9 dishes, and have already seen an increase in orders with the new options.
As part of this evolution, we’ve made some hard choices to deliver on these improvements. We’ve decided to pause operations in Chicago for the time being to focus our company efforts on building out this new operational model. It is incredibly difficult to make and test changes to a new model in multiple markets, and we don’t want to hedge our bets with two different paths in two cities. We’re going all-in on our new model, and scaling Chicago back now allows us to be nimble and then re-start with the updated model once we’ve fine-tuned it in San Francisco. Chicago has been a great home for Sprig--since launch, we’ve delivered hundreds of thousands of meals. We are sad to part ways with our local team members and are thankful for all our customers’ support. When we resume service in Chicago, we promise to have an even more delicious and convenient product than ever before.
We have also decided that Sprig needs a slightly different team to execute this strategy, so we have made the very tough decision to eliminate seven roles in marketing and operations as they are not integral to our new model. These are the hardest kind of decisions, and we are sad to part ways with these team members. We are working hard to find them positions at new companies, have provided them with meaningful exit packages, and are grateful for all their contributions that got us here today.
The food space is not easy. We are lucky to be in a strong financial position with tens of millions of dollars in the bank and years of runway. This gives us the time to proactively test changes and perfect our business model to build the best large-scale business for the long term.
If you haven’t tried Sprig yet, I’d love your feedback on how we can become your easiest, most reliable, most delicious option for every day--and If you have, please continue to share feedback in the coming weeks and months and tell us how we’re doing.