Dragons’ Den success stories: Approved Food
After being snubbed by the Dragons, this discount grocery retailer went on to raise £400,000, hit turnovers of £4m and find favour with Sir Richard Branson
Company name: Approved Food
Description: An online retailer selling discounted groceries that are close to or have passed their ‘best before' date
Investment sought: £150,000 in exchange for 10% equity
Why didn’t the Dragons invest? They didn’t believe the business was established enough and suggested that profit margins were too low to work with
In a society where costs only ever seem to rise, we Brits will pounce at a bargain; with many supermarket shoppers heading straight to the yellow label discount shelf to snag out-of-date groceries for cut prices.
Capitalising on this popular practice, Sheffield-based online retailer Approved Food has taken the discount shelf to the web, helping families save a potential 70% on their shopping by selling food and drink at bargain prices – simply because it’s approaching or has passed its ‘best before' date.
Started initially as a market stall from which founder Dan Cluderay would flog products that had passed ‘best before' but were still safe (‘best before' and ‘sell by' dates just indicate optimum quality, whereas ‘use by' is the date to be wary of), the business turned digital in 2007.
Eight years later, Cluderay – along with his business partner Andy Needham – took to the Den in search of funding.
However, the Dragons chose not to invest – though Peter Jones said he would do so were the business more established – and argued that the company’s profit margin wasn’t high enough, which Cluderay says is what enables it to help customers save.
Ultimately, though, the Dragons shouldn’t have underestimated the appeal of a great discount.
Despite disapproval in the Den, Approved Food has achieved a roster of successes, including raising £400,000 funding, finishing as a runner up in Sir Richard Branson’s 2015 Pitch to Rich contest and winning a £100,000 marketing campaign, and hitting £4m turnover and over 3,000 orders per week in the same year.
Approved Food has also been featured on primetime ITV, has upgraded to a 60,000 square-foot warehouse and has rolled out sister websites specialising in pet products, sweets and natural foods.
In spite of this success, Cluderay isn’t too surprised that his business didn’t impress in the Den, telling Enterprise Nation: “Looking back, talking to multi-millionaires about saving a few quid on their weekly shop was perhaps a bit naïve.”