Freshii Inc. is revamping its mobile app, which its chief executive says is “certainly not where it should be”, as the company’s stock plummeted nearly 21 per cent following the release of quarterly results.
The healthy fast food chain’s stock closed on the Toronto Stock Exchange at $2.67 on Wednesday, a drop of 6.64 per cent.
Freshii founder and CEO Matthew Corrin told analysts on a conference call Wednesday morning that the company’s mobile app — which allows users to order food for pick-up or delivery from Freshii locations — has not met expectations and needs improvements.
“I think there’s good news and bad news to the mobile story. The bad news is we still haven’t got it right,” Corrin said on the call Wednesday. But he remains optimistic.
“The good news is we still haven’t got it right.”
Corrin said that the company’s mobile app will be able to help drive same store sales — a key metric in retail — but that so far it has not been able to do that due to a range of factors.
“I don’t think there’s one thing. I think, unfortunately, it’s a lot of things,” he said. Among them, Corrin said the app should be “more frictionless, more efficient and more intuitive” and that the user interface could be improved. He also said that, when it comes to the operations side of the app, some stores have struggled to fulfill mobile orders.
Customer reviews tend to agree with Corrin’s assessments.
For example, the average rating of the app in the Apple store is 2.6 out of five, based on 108 ratings. Some reviews complain the app is “buggy”, “looks nice” but is “painful to order”, has “bad integration in store” and that “ordering doesn’t even work.”
The company’s mobile technology team, which comprises of 10 employees, is currently working on the next generation of Freshii’s mobile app, Corrin said.
“The good news is we’re aware of them all and we have the right team who are aggressively attacking it and we’re very excited to get it to our guests as soon as reasonable,” he said.
Freshii’s same store sales in the second quarter fell four per cent, compared to an increase of 0.9 per cent during the same time last year. Net income for the quarter was US$400,000.
Freshii is currently in the midst of rolling out several initiatives aimed at improving the company’s performance.
The food chain is rolling out a streamlined menu, which will see the lowest-selling items as well as highest-waste ingredients removed in order to improve costs. Freshii is also going to “upgrade” the proteins it offers and is currently testing oven-roasted chicken breasts, turkey meatballs and vegetarian proteins at 30 of its locations. It is also planning on rolling out a plant-based protein option in the fall when it reintroduces its seasonal chilli option.