After developing websites and intranets for clients from 1999, Andrew Smith founded Yuppiechef alongside Shane Dryden in 2006 as a part-time venture while they continued to run a small web agency.
The kitchen and home brand has since grown into one of South Africa’s leading omnichannel retailers, winning the country’s E-commerce Awards six times.
Yuppiechef is known for its obsession with customer service, every customer gets a hand written card with every order they make, and if you had purchased at Yuppiechef before, the card writing duty will fall to the rep, where possible, that wrote that first card to you.
Yuppiechef has two primary operations, namely Yuppiechef Online, the retail division comprising the online platform and seven stores, as well as a wholesale division, which develops, and imports branded goods for wholesale distribution.
The founders sold the brand to Mr Price Group for an estimated R470 million in March 2021.
Background
Yuppiechef wasn’t the first e-commerce site that Andrew Smith and Shane Dryden started. At the time, they were doing marketing and development for clients, and they saw online retail as a way of putting their skills to use on something that they could fully own and leverage for financial gain.
Yuppiechef didn’t really feel like a good idea in the beginning. It also took a lot longer than they thought it would to make it successful. And the company’s strategic advantage wasn’t really so apparent in the beginning.
“We started small, we sold bug zapping tennis rackets, country flags and rat traps. Kitchen tools was our ‘next big idea’, although to be honest, none of them were really intended to be big ideas — we just wanted to make enough money to stop selling our time by the hour to other clients.”
Due to not having start-up capital, they were forced to do all the technical work of setting up the website themselves, and only bought stock after a customer bought from them.
“This worked, but very slowly. We only made 11 sales in the first four months, and ten of them were to friends and family.
Reality is that most businesses are bootstrapped, and they take a lot longer to build momentum and pay the bills than you’d expect. It was five years before Yuppiechef could support our families, and in all that time we still did work for other clients.”
The duo knew that customer loyalty towards their brand would achieve organic growth, which was why they focused on adding a special touch to each order from Yuppiechef’s inception.
“We worked from my lounge and answered every phone call, packed every box and added handwritten notes to every customer who bought from us. This didn’t cost anything, except our time, which feels very free when you’re trying to get a business off the ground.”
The patience, slow and steady growth and special touches paid off, Yuppiechef eventually cornered a market that is focused on South Africa’s food and cooking culture.
In 2010 the brand attracted huge media attention through guerilla marketing tactics that leveraged a national marketing campaign by retailer Woolworths called ‘Woolies Lovebirds’. Playing off a typo in the URL on the Woolworth’s campaign material, allowed Yuppiechef to register the misspelled URL, where they posted a ransom note requesting that Woolworths match any donations made by Yuppiechef customers to a local charity they supported. Woolworths took the ransom demand in good spirit and embraced the opportunity for a feel-good story – not only did they agree to match any donations up to R7 500, they also agreed to let Yuppiechef keep the ransomed webpage, as long as they added a link to the real Woolies competition.
Acquisition By Mr Price Group
In March 2021, Mr Price Group announced the purchase of Yuppiechef for R470 million. The group said that the purchase would give it the opportunity to gain access to a higher LSM customer base, enabling the growth of its share-of-wallet through ‘aspirational value spending’.
“We spoke to our team and told them we’re not the company we were five years ago, so change is inevitable. One of our values is growth. If you are not growing, you’re dying. We can’t have growth as one of our values and resist change,”
To maintain the ethos of their business, Smith said it’s important for consumers to realise that the Mr Price Group does not want to turn Yuppiechef into Mr Price.
“They’ve got hundreds of stores, if they want more of that, they will open more of them. They brought us on board because they want us to keep on doing what we’re doing,”.
The pair said they knew it was time to sell the business when hard lockdown hit South Africa.
“Just like in the game of Who Wants to Be a Millionaire?, we were faced with a double or nothing choice. Do you risk it all to keep on going? We wanted to stop playing double or nothing,”
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“We don’t obsess about competitors. We don’t spend all of our time necessarily analyzing them or watching their every move, but we do have to say, as a company, that we’re going to try and be something different.”
Throughout their journey of success, they realised that there is no magic bullet to turn your business around overnight. It takes time and effort and resilience.
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