Since the coronavirus began to wreak havoc on the food industry, Pat’s King of Steaks, the 24/7 Philadelphia cheesesteak institution, has seen business at their window drop by 80%. Likewise a New York landmark, Ess-a-Bagel has seen retail business fall by 80% since mid March, when shelter in place rules took effect.
Countless small businesses like them have been forced to shutter because of similarly challenging numbers. But Pat’s and Ess-a-Bagel have continued turning out their specialties thanks to the online gourmet food store Goldbelly.
“We’re making 8,500 cheesesteaks a week for Goldbelly,” says Pat’s owner Frank Olivieri. The Philly stalwart has already shipped around 55,000 of their melty cheese-meat behemoths, flash frozen and requiring only reheating, since mid March; orders are sold out through the end of May.
Likewise, Ess-a-Bagel Chief Operating Officer Melanie Frost says her landmark stores are shipping around 500 orders, or 6,000 bagels, a day because of the company. “And we could do more. Thank goodness for Goldbelly,” she says.
Goldbelly has been around since 2013, helping food lovers procure authentic New Orleans king cakes and Texas pecan pie. Chief Executive Officer Joe Ariel started the company with around $3 million in funding from sources such as Intel Capital and the Silicon Valley incubator Y Combinator. It has grown steadily through word of mouth (and relentless online advertising).
But the site has seen accelerated growth since shelter in place rules took effect—it’s currently one of the few success stories in the food world during the pandemic. Ariel says business is up 200% through mid April compared to the same time period last year, although declines disclosing specific figures. “We’re seeing more demand than at Christmas, which is our biggest time,” he says, adding that the order size has gone up about 30%.
The service currently partners with some 500 vendors from Walter’s Hot Dog Stand in Westchester to Snow’s BBQ in Lexington, Tex. Since the pandemic, he says he’s been fielding hundreds of requests a day from places eager to ship their specialty. Newly activated is Manhattan’s most famous pepperoni slice, Prince Street Pizza, which is shipped frozen, ready to crisp in the oven.
“For local restaurants, we can help open up the rest of the country. People understand the value proposition of food e-commerce much more than they did a couple months ago,” says Ariel.
While apps like Seamless and Caviar can transport many of the foods Goldbelly offers across town, they can’t get a Langer’s Deli pastrami sandwich from Los Angeles to Boston. Potential competitors like mouth.com and igourmet.com, specialize in curated packages such as cookies and cheeses, as opposed to the decadent dishes that might have starred in Man v. Food. For those small businesses who depend on expanding their scope beyond the now evaporated local traffic, the service has become a vital source of revenue.
Cooped-up, bored people are willing to pay a premium for indulgent foods that make them feel better, and Goldbelly is accommodating them, too. Especially those who might crave dishes from a place they can no longer travel to—a cancelled vacation to New York can be evoked with mile-high deli sandwiches and black and white cookies.
To capitalize on the emotional connection people have to local specialties, the company has released a new subscription box that benefits first responders. Customers can order 3- or 6-month packages from half a dozen cities including Chicago, Miami, San Francisco, and New Orleans filled with signature foods; 100% of the proceeds go to care packages that are sent to first responders and healthcare workers based on foods they request, and customers can nominate people to receive them. (Chrissy Teigen was the first to place an order, and went further, sending an additional donation of Little Italy cannolis to paramedics in Indianapolis.)
One of best sellers during the pandemic has been a not-so-local business. The Shake Shack Inc. package, introduced at the end of March, has already sold over 80,000 burgers.
“We’re thrilled to offer our guests the ability to recreate the Shack experience in their own homes,” said Culinary Director Mark Rosati over email. “Now more than ever, we need to find new ways to connect with our guests.” (Ariel says that the backlash over the company’s $10 million government stimulus loan—subsequently returned—hasn’t hurt sales so far, although he received comments.)
One reason a major player like Shake Shack partners with Goldbelly is because the company is very good at packaging invariably delicate product. They spend months figuring out optimal conditions for shipping whether its refrigerated, ready-to-reheat like a cheesesteak or pizza, or a kit, like Pittsburgh’s famed Primanti Brothers sandwich, a mess of griddled meats topped with fries and cole slaw, to be assembled at home.
All that means it takes time to onboard potential vendors. Ariel likes to check their quality and how it can survive shipping in good shape, leading to that bottleneck in requests.
The cost of a Goldbelly order varies. The 8-pack ShackBurger costs about as much ($49) as it would to pick up the cooked burgers, at the Madison Park flagship, but shipping starts at $15. An 8-pack of Pat’s Philly cheesesteaks is $99, not including shipping; those sandwiches are around $6 each at the window in Philly.
And although food production is better for restaurants, then say, t-shirt sales because it entails hiring workers to cook food products, it doesn’t replicate pre-Covid-19 sales. Olivieri at Pat’s says that he had to lay off 11 people and is working with a skeleton crew.
Nor can it ever replace actual local business, even for successful partners.
On the Philadelphia Philly’s opening day, “we might do 5,000 sandwiches,” says Olivieri. “It’s nothing like that now.” They get some business from Seamless deliveries and relentless fans who show up at the window. But still, he says, “if it wasn’t for Goldbelly, our doors would be closed.”
This article was provided by Bloomberg News.
