Successful Brisbane-based, fresh meal company Youfoodz hits snags

Brisbane’s Youfoodz has become one of the most recognisable names in the ready-made fresh food market, but a series of legal and industrial stoushes is delivering the company unwanted attention, writes Vanda Carson.

A SUCCESSFUL Brisbane fresh meal delivery company that has been punching above its weight in the fight to feed time-poor professionals has been in the spotlight in
recent weeks for all of the wrong reasons.

Youfoodz, which is run out of a factory in Virginia in Brisbane’s northern suburbs, has been laying off staff, accused of not paying staff superannuation, been subjected to a shareholder lawsuit, an unfair sacking claim by an ex-staffer and a bitter legal stoush with a supplier over unpaid bills.

Youfoodz targets time-poor Millennials with new meal kits

Youfoodz’s meal kits arm, based in Salisbury, and launched with great fanfare months earlier, was rumoured to have been shut on June 11, with four staff gone and other staff hoping to be relocated.

But yesterday chief executive Lance Giles told Insight the meals kits arm was only “a test to evaluate the market” and stage two is now under way.

Only days earlier 23 marketing staff were rumoured to have been laid off, along with a workplace health and safety officer and a wholesale representative based in NSW.

Digital staff who worked on Youfoodz’s Facebook and Instagram accounts were
also alleged to have been shown the door from the Geebung office.

Then current and former staff began complaining that they had been getting small superannuation payments, only a portion of what they are owed, from the Australian Taxation Office.

Giles says he was forced “to make a number of staff redundancies due to a number of projects being finalised” and increasing wages costs. But he denies falling behind in his superannuation obligations, telling The Courier-Mail, “We can confirm that all superannuation assessments have correctly been lodged with the ATO and are being paid regularly.”

Lance Giles at the opening of My Fit Fridge in Carrara in 2012. Picture: Katrina Jones.

Youfoodz, which successfully tapped into the ready-to-eat meal market, giving busy young professionals who want to eat “clean” more time at the gym or with friends, also settled a $180,000 unfair sacking claim on May 14 brought by its former head chef.

On the day former head chef Rodney Thirlwell, 47, from Scarborough, was due to have his case heard in the Federal Circuit Court the parties settled and “a deed” was executed.

Thirlwell, who was also a former procurement manager, sued IDK Pty Ltd, trading as Youfoodz, claiming he deserved two years’ salary as compensation for his sacking.

Youfoodz head chef drops $180,000 suit and signs a ‘deed’

The business has also been involved in two other cases, one related to a fight over $806,000 in alleged outstanding invoices from a supplier, and another a shareholder dispute. A company allegedly linked to former bankrupt childcare tycoon Eddy Groves is suing Youfoodz, claiming it owns a slice of the business.

The fight with the supplier in the Federal Court revealed that in November last year, Youfoodz’s relationship with one of its suppliers became strained, after it decided to buy their chicken schnitzels rather than making them in-house.

Sydney chicken company Cordina Foods served a statutory demand on Youfoodz for $533,203 in November.
The demand was withdrawn after Youfoodz paid Cordina the full amount but, months later, on March 11, Cordina then served another statutory demand for a further $274,000.

YouFoodz meal kits.

In court on June 7 Youfoodz won the fight to set aside the demand for $274,000 on the grounds there was a genuine dispute in relation to the total amount of money owing.

Youfoodz successfully argued the $274,000 related to a stockpile of chicken and a spiced breading mix for which Youfoodz had not placed a purchase order.

Started in 2012, the company grew fast off the back of advertising with Channel 9’s popular home renovation show The Block, and now produces 65,000 meals a day for its customers nationwide and has staff working three shifts a day around the clock.

Giles says the company’s sales will surpass $250 million this financial year, but declined to give detailed profitability figures.

Youfoodz products.

He is said to have a strong work ethic, arriving at work in his flashy white Range Rover at 6am every morning, clad in gym gear, and working well into the evening.

The company, and its 1000 staff, pride themselves in their can-do culture, with Youfoodz sourcing manager Kevin Marriner telling a court he “worked four 20-hour days last week, on site in Virginia, which included one particular night of me driving YF delivery truck to the airport myself just to ensure our customers were not let down”.

Youfoodz ready-made meals are now stocked in 3000 stores including IGAs, petrol stations, at Aldi, gyms and convenience stores.

All meals are made in Brisbane and online orders of $50 or more are home delivered to customers in all metro areas in Australia.

Former bankrupt Eddy Groves link to Youfoodz shareholder in court

From the street, the factory carpark contains several small rented refrigerated delivery trucks ready to hit the road and towering stacks of styrofoam boxes surrounding a massive refrigerated shipping container.

The business has leveraged social media and mobile text messaging to keep hungry customers coming back, enticing them with discounts, mouth-watering images of the latest food trends and updates to its seasonal menu.

Competing with rivals including Lite n’ Easy, Hello Fresh and Marley Spoon, it sells fresh meals, not frozen, using carbon dioxide and other gases to keep them fresh for nine days in the fridge, and promotes itself as convenience food rather than diet food or old-style TV dinners.

It is a private company and although its chief executive is Lance Giles, he isn’t a director or shareholder.

Giles ran Youfoodz’s predecessor, Gold Coast-based My Fit Fridge, which collapsed with debts of $1 million in 2012.

Youfoodz’s largest shareholder and sole director is New Zealand-born Karl Arthur Giles, 32, from Ashmore on the Gold Coast, company records show.

His father Arthur John Giles, from Reedy Creek, is the second-largest shareholder, followed by Youfoodz chief financial officer Jennifer Dowery and another shareholder.

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