A new fresh food and meal delivery service has launched in Chicago's north shore suburbs with plans to expand into southeastern Wisconsin by early next year, aiming to fill a growing need across the region for home-delivered groceries.
Unlike other grocery delivery services, Kenosha-based Fresh Midwest doesn't sell household items like toilet paper or laundry detergent or dry goods like pasta. It focuses on whole and pre-cut produce, meats and seafood, as well as pre-made fresh snacks, salads and meal kits, all of which are processed in-house at Fresh Midwest's facilities in Kenosha, at 6950 51st Street, and in Chicago. Customers place orders online for contactless home-delivery as soon as the following day.
"We're not a complete grocery store, we are a fresh solution," said creator Patrick Fitzgerald, who co-owns the business with this twin brother Mike Fitzgerald.
They are two of eight second-generation family operators of Midwest Foods, a Chicago-based wholesale produce distributor and the parent company of Fresh Midwest. Midwest Foods sells its products to hotels, country clubs, restaurants and hospitals across the Midwest, including to high-profile clients in Wisconsin like Miller Park and Fiserv Forum.
Thanks to its parent company's existing relationships with local and national farmers, artisans and restaurants, Fresh Midwest sources inventory directly from suppliers and growers. Ready-made items such as salads and sandwiches are prepared on-premises.
That short supply chain is crucial for maintaining the quality of fresh food, and for keeping prices down, said Fitzgerald.
"I know for a fact that if that palette of bananas or that trailer load of melons comes in, it's coming in from the growers in California and I'm opening it here," he said. "There's no middle man or anything between that's going to shorten my shelf life on the product or to have a markup on that product."
The new consumer-facing division of Midwest Foods business was born earlier this year out of what Patrick Fitzgerald calls a "perfect storm."
In 2017, Midwest Foods opened a 71,000-square-foot facility in Kenosha to support production of processed fruits and veggies for national online grocery delivery service Peapod.
Peapod pulled out of the Midwest in February after 20 years, leaving behind available market share, 500 unemployed workers and empty production facilities in Chicago, Milwaukee and Indianapolis. It also left Midwest Foods wondering how it could continue selling its produce directly to consumers.
So, the Fitzgeralds approached Peapod's co-founder Thomas Parkinson, who also happened to be Mike's longtime neighbor and friend to discuss the challenges and opportunities of starting their own grocery delivery business.
"We ended up forming a plan right before COVID-19 hit, and when COVID came, we kind of accelerated the whole thing," said Fiztgerald.
They hired almost 10 former Peapod employees, including veterans Tony Stallone and Mary Rose Neises, who now help lead Fresh Midwest as chief merchant and marketing lead, respectively. Fresh Midwest has since hired an additional 200 employees between its two production facilities.
Once a website was built, Fresh Midwest began piloting its delivery service from Kenosha through Chicago's Lincoln Park neighborhood before opening it to the public last week. The company will soon shift focus to expanding the product north into the greater Milwaukee area. Fitzgerald anticipates a January public launch.
"We go all the way to Green Bay, Madison now with our current wholesale delivery service for Midwest Foods, and the intention is to mirror all of those routes..." he said. "We just want to have proof of concept that there is a need for this."
And there is a need, he said. Initially unveiling the service south of Kenosha allowed the company to prove the concept by leveraging Midwest Foods' existing logistical resources as well as the Fitzgerald family's Chicago-area roots, said Fitzgerald. During the month-long test period, he estimates "hundreds" of customers in the "family and friends" category placed orders, largely on a weekly basis.
So far, Fresh Midwest's top selling item is meal kits, with 20 to 25 sold daily, said Fitzgerald. Three out of its four meal kits are assembled with ingredients sourced from two Chicago-area restaurants, Wildfire and Big Bowl, which are both clients of Midwest Foods.
Those eateries as well as Gibson's Bar & Steakhouse have partnered with Fresh Midwest to sell frozen dishes under its "Restaurant Made" category. Fitzgerald said he's in talks with a few other restaurants, one located in Milwaukee, to develop some meal products exclusively for Fresh Midwest.
The concept was something Fitzgerald had wanted to pursue for a while, but "never had a vehicle to do it," until Fresh Midwest. Now, as restaurants struggle to bring in business due to the pandemic, it's another source of much needed cash flow.
"It's another revenue stream for them, and they can still connect with their clientele..." he said. "The best thing is if people from Illinois don't want to come to Milwaukee or people from Milwaukee don't want to come to Chicago, there's that reciprocal transportation that I can provide right here in the middle to get their product in here and it get it to them."