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Click of the crop

Amy Ma

It takes a leap of faith, but once Hongkongers cross that 'trust threshold' Katie McGregor is convinced grocery shopping will never be the same again.

Inspired by the popular New York online grocer, Fresh Direct, which delivers anything one could expect to find in a supermarket straight to customers' doorsteps, McGregor hopes her company, Epicure Direct, which she launched in September, can fill the same niche in Hong Kong.

'Online shopping is convenient for both sides: there are lower overheads so customers can get better value ... and people can shop at any time without queuing,' says McGregor. Selling grass-fed strip loin for HK$188 per kilogram - a comparable item at supermarkets would cost about HK$300 per kilogram - she's winning over a steady stream of converts.

Online retailer Oisix, founded in Japan in 2000, began offering its services to Hong Kong in February last year. Oisix is Japan's largest online retailer, with more than 450,000 registered customers, and its sales team believe the Hong Kong market has the potential for an equally large customer base.

'Grocery shopping is a chore, and we saw a need in other Asian countries, where people work long hours, for the convenience of online shopping,' says Max Huang Ching-che, the company's Hong Kong representative.

The Hong Kong market comes with its own set of hurdles. 'In Japan, many housewives cook at home and restaurants are quite expensive, but here in Hong Kong, with so much affordable eating and the ease of getting around the city, people don't buy large amounts of groceries except for special occasions,' Huang says.

'There is also fear of 'ordering blind' or from a photograph,' adds Bradley White, the founder of South Stream Seafoods, which delivers wild-caught sustainable fish from Australia and New Zealand straight from the plane to homes. 'Hongkongers like to go down to the wet markets and pick the exact fish they want.'

What's more, most online retailers fulfil orders in bulk amounts, says Waves Pacific founder Jason Lo. His company specialises in Australian Wagyu beef, with a minimum requirement of 2kg, or eight to 10 steaks, per order. Started in 2002, Waves Pacific was intended to be purely a wholesaler. 'Home delivery started after friends kept calling in with special requests,' Lo says. 'It was never meant to be a big part of the business, and in many cases it is a lot more work than wholesale.'

South Stream Seafoods was also originally established as a wholesaler (in 1990), but entering the retail market saved the business. 'We suffered greatly during Sars in 2003 when we were completely dependent on hotels and airlines for business. The orders stopped coming in,' White recalls.

'That's when we decided to move into delivering straight to residents. It's the case of one desperate wholesaler discovering a completely new market.' Today, South Stream Seafoods' business is 80 per cent dedicated to retail.

Increased awareness of healthy eating is one of the main factors boosting the popularity of online grocers, many of whom provide detailed information on their websites about the source and quality of ingredients. 'We have our own safety centres to screen the quality of our vegetables, and sell about 30 per cent to 40 per cent organic foods certified according to Japanese standards, which are the strictest in the world,' says Huang. At Oisix fruit and vegetables are marked with the names of the farms they come from, and not harvested until the actual orders are placed.

The relatively new status of online grocers means they have to start small and carry a limited selection of items. While Oisix sells more than 2,600 items in Japan - meat, processed foods, drinks, pastries, and even cooking utensils and recipe books - in Hong Kong, it only offers fruit and vegetables.

'They are the most difficult items to manage because they are highly perishable,' says McGregor, who carries a small proportion of vegetables in comparison to meat and seafood, which makes up more than 65 per cent of her business. 'There is also the issue of seasonality. People have to accept they will only get what's available during certain times of the year.'

Seafood inventory can be unpredictable as well. White describes the process at South Stream Seafoods: 'We send a list to our suppliers, but that is more of a 'wish list'. It all depends on the catch ... Normally, our online store is 'closed' because we don't have any fish in stock.

'When we receive a new batch, we send an e-mail to our list of customers telling them what fish we have, and they send in their orders. It's first come, first served and within hours items are sold out.'

The fish South Stream Seafoods' customers receive are not commonly found on the supermarket shelves, such as barramundi and John Dory.

For a more sophisticated cook, this can be a huge draw. 'Now people at home can cook with restaurant-quality ingredients. It's the same fish that you get at Gaddi's in The Peninsula hotel. The results may vary depending on the cook, but at least it's the same starting point,' White says.

Likewise, customers of Waves Pacific are privy to a premium selection of Wagyu beef, offered at a 20 per cent to 30 per cent discount from supermarket prices. 'Most supermarkets only offer M8 or M9 Wagyu, but we've found different cooks may like to work with slightly lower grade M6 or M7 beef, which is less fatty,' says Lo.

Ivy Wong, founder of online grocer Meat Market, which has been in business since 2007, says her selection rarely includes Wagyu except for special holidays. 'We're focusing on the average home cook who prefers the standard rib-eye or sirloin,' she says. She tries to simplify the cooking process for her 5,000 customers by organising classes on topics such as 'How to cook the perfect steak'.

Pre-assembled seasonal sets - Christmas, barbecue, or Valentine's Day - are a big hit with McGregor's customers. 'It's our job to figure out what our customers want,' she says. 'We've even prepackaged steaks with sauces and condiments to make a quick ready-to-cook meal for people tired after a hard day's work.'

In recent months, competition for the online grocer space has become more intense, and retailers are rapidly evolving. Wong has just added a same-day delivery service to Meat Market, and by the end of this month, White hopes to triple the size of South Stream Seafoods' facilities and start importing special dietary products and eco-friendly house cleaners. Oisix and Epicure Direct are also expanding their line.

At the moment, most online grocery shoppers are expats from Western countries. 'It's hard to be exact, but about 60 per cent of customers have non-Chinese surnames,' says White. 'But you never know, the rest may be overseas Chinese who speak with Australian accents.'

'Men make up a surprisingly large percentage of our customer base,' says McGregor, who suggests that they may prefer their meat-centric selection and appreciate not having to wander the supermarket aisles to locate ingredients.

To help new customers adapt to the online ordering process, it is of utmost importance to have a 'human face' attached to the service, says McGregor. She often follows up on customer orders with a phone call. And all online grocers offer a hotline for customer support.

'We are almost like personal shoppers,' says Wong, who relies almost solely on word-of-mouth recommendations to reach new customer groups. 'But this way we also get instant feedback by developing real relationships with our customers.'

Fancy a byte? Here's where to go to Net your supplies

Aussie Organics

aussieorganics.com, tel: 2293 2265, e-mail: [email protected]

Products: organic fruits, vegetables, seafood, and meats from Australia

How to order: via the website or fill in manual order forms available online

Minimum order: none

Payment: online or credit card

Delivery: last orders Sunday for Friday delivery

Baking Warehouse

bakingwarehouse.com, tel: 2172 6916, e-mail: [email protected]

Products: speciality baking products and equipment

How to order: via website, fax (2172 4926), or at the warehouse (Unit E, 4/F Lladro Centre, 72-80 Hoi Yuen Road, Kwun Tong)

Minimum order: none; delivery charges paid separately (prices vary)

Payment: cash

Delivery: orders before 6pm delivered the next day between 11am and 6pm

Epicure Direct

epicuredirect.com.hk, tel: 2858 6751, e-mail: [email protected]

Products: meats and seafood from Australia and Norway, deli items, wine and organic vegetables

How to order: via website or by phone

Minimum order: HK$500 with free delivery

Payment: online, credit card, bank transfer, cash or cheque (payment on delivery)

Delivery: orders before noon for next-day delivery

Meat Market

meatmarket.com.hk, tel: 8135 1394, e-mail: [email protected]

Products: quality meats

How to order: via website or by phone

Minimum order: HK$500 (free delivery), or pay an additional delivery fee (about HK$50 to most areas)

Payment: online, credit card, bank transfer or cheque

Delivery: orders before 11am (Mon-Fri) for same-day delivery; orders before 1pm for next day delivery (except Sun)

Oisix

hk.oisix.com, tel: not available, e-mail: [email protected]

Products: organic vegetables and fruits from Japan and a limited quantity selection of other Japanese products

How to order: via website

Minimum order: none, but delivery fee required

Payment: online

Delivery: last orders 1pm for delivery on the following Wednesday between 9am and 7pm

Porterhouse

porterhouse.com.hk, tel: 2553 3765, e-mail: [email protected]

Products: USDA and Australian steaks, lamb, pork, chicken, sausages, lobster and wine

How to order: via website or by phone

Minimum order: HK$500 (free delivery)

Payment: online, credit card or cheque

Delivery: orders by 9am for same day delivery (except Sun)

South Stream Seafoods

south-stream-seafoods.com, tel: 2555 6200, e-mail: [email protected]

Products: wild-caught sustainable seafood from Australia and New Zealand, various meat products

How to order: register online to receive regular newsletters on the freshest catch; and orders are taken on a first come first served basis via e-mail, online or by phone

Minimum order: HK$400 (free delivery), HK$200 (for an additional HK$45 delivery charge)

Payment: online through PayPal, bank transfer, or cash or cheque on delivery

Delivery: see website for delivery schedules to different areas in Hong Kong

Waves Pacific

www.wavespacific.com, tel: 2995 1585, e-mail: [email protected]

Products: Australian Wagyu beef, a limited selection of fresh vegetables, and the Tetsuya line of home kitchen products (which includes salts and sauces)

How to order: phone, e-mail or fax (2493 4166), order form (available via website)

Minimum order: HK$500

Payment: cash or cheque

Delivery: call for details

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