Startup with a mission – from “healthy meals” to “comprehensive care”
In Canada, a substantial number of elderly who are over the age of 65 and live alone cannot cook for themselves due to various reasons, and there is nobody to help. Meals in Need (www. mindiet.ca) takes advantage of the issue at hand and turns it into a business opportunity. At a rate of approximately CAD7 per meal, Meals in Need supplies the elderly with quality and delicious food to satisfy their needs and improve their health, bringing food and warmth to the elderly’s homes.
Dr. Gabriel Chan, Mr. Sammy Lee (a lawyer), and Mr. Chan (retired) are the founders of Meals in Need. While all three of them do not have any experience in the food industry, why did they establish Meals in Need? The idea originates from Dr. Chan’s travel experience.
Dr. Chan used to specialize in internal medicine in Hong Kong. After immigrating to Canada in the 1990s, he received further training in the country to become a geriatric specialist and has since been serving in that role for many years now. He was the Medical Director of Yee Hong Centre for Geriatric Care. When Dr. Chan travelled to Tibet in September 2015, he read a book titled “Growing Old As Time Goes By” (《活着活着就老了》) and was both moved and puzzled, “Why do we grow old as time goes by? What can we do?”
As Dr. Chan descended from Mount Everest in Tibet, he planned to resign from his position in the hospital and instead focus on how to get in touch with the elderly using food and how to care for their later years.
The elderly faces many challenges in life
In Canada, many elderly suffer from severe Alzheimer’s (disease) or dementia. They face many hardships in life and live every day unhappily. Some of them even choose to end their lives with drugs. However, the Canadian government fails to provide sufficient support. Dr. Chan thus discussed with Mr. Lee to see if they could provide catering and psychological support to the elderly.
Meals on Wheels, a meal delivery initiative advocated by the Canadian government and implemented by several charity organizations, charges each eligible elderly CAD7 or CAD 7.5 per meal, with some being fully or partially subsidised by the government. Due to tight requirements of the government, the number of such meal delivery organizations is low. Their kitchens must be compliant with all regulations, raising costs substantially and making it difficult to have a profitable business. As a result, not that many food businesses are interested to invest in this market. Nevertheless, Dr. Chan and Mr. Lee viewed that such meal delivery services would have a certain market demand.
Betting on this gap in the market, the two are joined by Sara Chang (the CEO of Meals in Need), who is extremely familiar with the industry, the three of them decided to invest in this market. They also set their preliminary business goals – providing healthy food to the elderly, while taking into account their spiritual needs.
Many a little makes a mickle – developing various fund-raising avenues
The sources of the funds of Meals in Need can be divided into three categories:
- The first category refers to loans from banks. The founders made a loan application to a local commercial bank named The Bank of Nova Scotia. The bank initially treated the loan application with much caution due to three reasons: first, banks usually require personal guarantee from a director or the major shareholder before approving the loan application, but there was no guarantor for Meals in Need; second, the investors were not familiar with the food industry and lacked relevant experience, making it more difficult for the bank to approve the loan application; third, the food industry has a high amount of risks and banks are in general very cautious in lending. In spite of the challenges, with tremendous support and assistance from a Christian staff member, the bank eventually approved the loan application. Meals in Need raised half of the capital required.
- The second category of funds were obtained from the founders and private loans. Apart from the three shareholders, two independent lenders were willing to contribute funds for a two-year and five-year interest-free loan period respectively. Meals in Need thus raised the remaining capital required.
- The third category was financial assistance from the church. Dr. Chan and Mr. Lee, both Christians, introduced the vision and plans of Meals in Need to the Toronto Christian Community Church, which endorsed and supported the initiative and was willing to sponsor the renovation costs.
The amount raised was enough to cover the costs of setting up a kitchen and 6 to 18 months of operating costs.
Since the mission of Meals in Need was recognized and supported by the community, even though the startup conditions were unfavorable, the company could still begin its journey miraculously. This kind of active support from the community would be absent in profit-oriented companies.
Working with the church and obtaining community trust
Meals in Need’s kitchen is located in the church property 105 Gibson Centre.
105 Gibson Centre is one of the church ministries of Toronto Christian Community Church and a service centre based on Christian faith. It occupies an area of 47,000 square feet and has been operational since the 5th of October, 2013. The decision to establish Meals in Need in 105 Gibson Centre was not purely commercial. While the meter room of 105 Gibson Centre is located at the east side of the building, Meals in Need is at the west. Rerouting is needed for water, electricity, and gas supply lines, leading to significant increase in renovation costs.
However, Mr. Lee said: “We understood this to be a vision from God. If we did not set up our kitchen in 105 Gibson Centre, we would not have any other support. Now many pastors come to pray for us and many support us, at least spiritually. Without this location, nobody knows or cares about us. Now people talk about our initiative, which is also advertised on newspapers or in publication. As we look back, benefits outweigh shortcomings.”
Meals in Need even paid to employ a spiritual and emotional care coordinator to conduct “spiritual care” work. The current spiritual and emotional care coordinator, Elizabeth Chan, was once a counsellor. She would carry out spiritual care work during meal delivery.
Although the government-subsidized meal fees do not include the costs of additional services, providing “spiritual care” is one of the founding mission statements of Meals in Need. As long as the financial costs are affordable, the additional “spiritual care” service for the elderly will be conducted.
First batch of orders obtained through medical network
Entrepreneurship is challenging. In the early days, Meals in Need faced various difficulties.
- As customers have never inspected Meals in Need’s kitchen, they would not order from it for no reason.
- Customers usually do tasting before ordering meals; without trying Meals in Need’s food in advance, they would not order from Meals in Need.
- Many organizations have already entered into contracts and cannot become customers of Meals in Need.
Fortunately, Dr. Chan and Sara have always been working in the medical industry and have established good connections. When Meals in Need began service in March 2017, it eventually received its first batch of orders and the turnover increased gradually.
Understand your strengths and exploit your strengths
Sara indicated, “Providing quality food and services can build up the company’s reputation, so that more people will know Meals in Need has high standard with delicious food and on-time delivery. By word of mouth more customers can be attracted.”
Sara majored in nutrition in Michigan in the United States. She studied administration as a minor. She stayed in the United States to work after graduation, before working as Administrative Dietician in various medical centres and hospitals in Canada, managing menus and catering for hospitals. As Sara was highly familiar with operation of the kitchen, Meals in Need had a natural advantage in its service and was attentive to details:
- Food from Meals in Need does not have MSG (Monosodium glutamate), is prepared with less oil and seasoning and is more health-oriented.
- The Meals in Need team will check if the menu is nutritionally balanced and whether the food combination is appropriate.
- Meals in Need prioritizes thermal insulation of food. It delivers meals with hot trays or heat gel for insulation, in order to keep the food at an appropriate temperature.
- When the Meals in Need team prepares chilled food, it reserves time for reheating and will not make the food completely cooked to preserve its freshness.
- The Meals in Need team will not leave food at room temperature for too long. It does not use the leftovers of ingredients when possible.
- As dietician of Meals in Need, Sara does food tasting to ensure the taste and quality of meals.
In addition, chefs of Meals in Need have received professional training and food handler certificates. Meals in Need also encourages its staff to be generous, be willing to go the extra mile and do things of one’s own volition. On the Open Day held by Meals in Need in recent years, Alan, a staff member, returns to office in mid-nights to check the status of the boiling soup. He comes back again at 9 am to reheat the soup. He is willing to do extra because he genuinely cares about the kitchen and food. The same applies to other staff members of the kitchen and the operation team, who agree with the company’s operation philosophy and emphasize service quality and impact.
The management of Meals in Need also shares the same inspiration – their mission is to improve the health and care for the soul of the elderly. In the ever-changing business arena, companies often face a lot of pressure and temptation. Regardless of startups or established businesses, without values that are fully implemented in operation, such companies will become indecisive. In addition, for profit-oriented companies, their staff and mid-level management will only focus on short-term benefits, and will be unable to make contribution that goes beyond salaries or originates from the heart.
The future of Meals in Need
In the future, Meals in Need will focus on the following strategic developments:
1. Advertise the “healthy” aspect
The strength of Meals in Need is its association with numerous healthy professionals, including doctors, lawyers, and dieticians. Meals in Need will focus on advertising its “healthy” aspect. It will emphasize that its food is nutritious and therapeutic. Targeting at cholesterol, diabetes, allergies or cancer when needed.
2. Targeting hospitals for advertisements
In the future, Meals in Need will target its advertisements at hospitals, including Toronto General Hospital, St. Michael’s Hospital and Providence Hospital. “Although there are only twenty participants of ‘daycare programme’ from Providence Hospital, this is a “stamping” process. As long as we get the first “stamp” from the medical industry, the status and reputation of Meals in Need will be established.”
3. Focus on existing service areas
The kitchen of Meals in Need is now only 1,800 feet big. In order to sell frozen food in supermarkets, the team needs to invest in another kitchen that is at least 10,000 feet large. This imposes tremendous pressure on the startup capital. In addition, every new development model belongs to a different type of business, raising the marginal costs significantly. The three founders agreed unanimously for Meals in Need to focus on existing service areas in the short term. Rapid expansion into different businesses would only disperse the company’s team power.
4. Control food costs whenever possible
According to financial analysis, the expenditure on food accounts for 30% of costs of Meals in Need, with another 30% on salaries and administration costs, while the remaining 30% to 40% would be profits. By providing meal delivery services for the government, Meals in Need can earn CAD7 per meal. It can make ends meet by delivering 400 meals per day. However, with rising consumer price index in recent years, food costs increase significantly. In order to maintain the level of profits, Meals in Need will control food costs whenever possible, in order to achieve balance between expenditure and revenue.
5. Encourage cooperation between businesses and the church
“We always need to ask ourselves, what is the purpose of doing this business? Our anticipated success is to achieve the mission of taking care of the elderly with earned profits. For meal delivery services and visits to the elderly, if there is only expenditure but not revenue, it is only a type of community service; when using profits earned from food catering industry on the work of elderly care, a new model of ‘business in mission’ is formed”. In the future, Meals in Need hopes to encourage more churches to participate in the brand new cooperation model between businesses and churches. Meals in Need’s latest plan is to work with several churches to implement the “Caring and Gospel Network Concept”, setting up meal delivery and outreach teams, serving those in need in the community, including the elderly, the impaired, the disabled, as well as those who are chronically ill.
Meals in Need also hopes to become a support team of Meals on Wheels, in order to get in touch with more less privileged elderly and injured patients.
Just like other profit-oriented companies, Meals in Need is not immune from various challenges and uncertainties common to all types of startups. However, as a business with a mission that aims to provide food and spiritual support for the elderly in the community, it impresses the community and its staff. It not only brings about assistance from external community, but the staff members are all committed to achieving outstanding operational efficiency. The initial mission of Meals in Need is the stepping stone towards strategic developments, and is also the key element of a successful company. We hope that Meals in Need can invest a reasonable amount of profits into more service areas in near future, that its business thrives, and that elderly in the community can receive healthy meals and spiritual blessings.