Running a farm is hard. Even once you’ve produced your cherries/chicken/cheese, you still have the go through the struggle of finding customers — and figuring out how to get your products to them.
Julie Niiro, CEO of the online farm-to-table marketplace MilkRun, knew all about this issue. She became a farmer about five years ago and was surprised by how difficult it was to find customers or even staff a farmers market. “There was a clear challenge of distribution,” she told me over the phone.
Two years ago she founded MilkRun to connect farmers and people who want farm-fresh food. The startup, which operates exclusively in Portland, OR, works with about 90 different producers making everything from baked goods to meat to vegetables. Customers can fill up a virtual “basket” on the MilkRun webpage (they’re working on an app), then select delivery for Tuesday or Thursday. Once the order window closes, farmers bring the goods to a micro-depot. There, MilkRun staff aggregates the products to fulfill customers orders.
Here’s where things get a little wacky: the delivery is done not by Milkrun staff or third party delivery drivers, but by the farmers themselves.
“We didn’t want to put more trucks on the road, and we also wanted to figure out more ways to pay farmers,” explained Niiro.
Basically, farmers already on their way out of the city after dropping off at the micro-hub will get loaded up with already packed orders and to deliver on their way back to the farm. MilkRun built its own software to manage micro-hub inventory and determine farmers’ delivery routes. Milkrun also provides a navigation app to farmers to let them know exactly where to drop off which orders, sort of like Uber or Lyft.
Unlike Uber or Lyft, though, the delivery window is not exactly…exact. Delivery occurs sometime between 7am and 3pm on the designated day (only Tuesday or Thursday for now), though as Niiro told me: “things do happen.” Understandable, but that wide of a gap — plus unintended delays — could make scheduling a time to be home for the delivery sort of a hassle.
Though MilkRun certainly lacks the near-instant gratification of Instacart or AmazonFresh delivery, it has no delivery fee and requires no subscription. It currently serves around 3,000 people and 11 restaurants and is in the middle of raising a seed round.
Though it’s only available in Portland for now, Niiro hopes to be piloting MilkRun in Seattle by the end of this year before eventually expanding into Austin and Denver. The company’s technology platform — which manages customers’ orders, farmer inventory, and delivery routes — should be able to scale fairly easily. The bigger question is whether Niiro and her team can build relationships with farmers in each new territory, and get enough on board to help with deliveries.
Price-wise, Niiro says that they try to be on par with what you’d find in retail. Maybe that’s true if you’re shopping somewhere upscale like Whole Foods, but the budget grocery shopper would likely balk at some of the prices ($1.50 for one blood orange or $7 for a dozen eggs). Which makes sense, since MilkRun doesn’t charge a delivery fee and needs to charge a higher rate in order to pay farmers a fair wage, plus some extra coin for doing the deliveries. Admittedly the goods on MilkRun’s site are a clear cut above what you’d find in an average supermarket, but still — it’s not really accessible to those on a tight budget.
Other companies have already proven that there’s a demand for services that deliver farmed goods directly to the consumer. In the U.K., high-end grocery delivery service FarmDrop gives consumers the option to have farm products shipped to their door. Closer to home, Grubmarket, which helps farmers sell their goods directly to consumers or corporations, just raised $25 million. Though it only operates within California, GoodEggs also offers a similarly curated grocery delivery service.
Niiro thinks that MilkRun can distinguish itself by controlling the whole distribution process from when it leaves the farm until when it touches down on a customer’s doorstep. The question will be if it can offer something new that its competitors can’t. The delivery-by-farmer piece seems to be Milkrun’s biggest value add since it reduces the need for staff and incentivizes more farmers to join up.
Then again, I don’t think farm-to-table delivery is a zero-sum game. Consumers are demanding healthier, more sustainable foods, and are willing to pay more for them. We’ll have to see if MilkRun’s value add of end-to-end delivery control is enough to make it stand out from the competition.