When Dan Cluderay appeared on Dragon's Den last month, the experts were highly skeptical about his business idea.
Cluderay wanted funding for a business selling out-of-date food at a huge discount online, and the Dragons decided that the idea wasn't going to go anywhere. Now 40-year-old Cluderay, from Worksop in Nottinghamshire, says the business, Approved Food, is turning over £4 million.
Cluderay first started selling out-of-date food in 2001 when he was made redundant from his job as a software engineer. With his redundancy money he set up market stalls in Leeds, Hull and Doncaster, and did a roaring trade. However, the idea for the online business came when he took a delivery of nettle tea. He realised his usual customers wouldn't be interested, but there were people elsewhere in the country who would - and if he could get the business online, he could reach them.
He teamed up with 50-year-old Andy Needham, who ran a wholesaling business and had a background in finance, to take the business online. The website went live in 2008, and he is now turning over £4 million from his warehouse in Sheffield.
Is out-of-date food safe?
His website sells items that have gone past the 'best before' date - or are very close to it. After this date they are still safe to eat, but the manufacturers estimate that their texture or flavour may not be as good as when they were first produced. All the items he sells are within their 'use by' date - which is a safety measure, and which the experts recommend nobody should eat once it passes.
The big retailers avoid food near or past the best before date, as their customers won't accept it. But for bargain hunters it's a small price to pay for reductions of up to 70%. At the moment deals on the site include Heinz balsamic vinegar, reduced from £2.89 to £1.49, eight cans of peach and apricot Fanta, reduced from £3.55 to £1, and 500g of Buitoni pasta reduced from £1 to 59p. The postage and packaging is £5.99, so shoppers need to order a handful of items in order to start saving
Would you buy it?
There is clearly demand for food like this. The site is one of the stars of ITV show Bargain Fever Britain, and after the first show aired, it saw a huge spike in people registering. Demand was so high that the website struggled to cope, and the company had to issue a Twitter apology.
The site taps into a growing movement, encouraging people not to throw food away on the basis of best before dates. The Love Food Hate Waste campaign has been actively promoting the fact that passing the best before date is no reason to throw an item out - and that there's no danger in eating food as it is within the 'use by' date. The Waste and Resources Action Programme (Wrap) recently discovered that shoppers could save £600 million a year by eating items just one day past their best before date.
There are currently not many online players in this market - aside from Approved Food and Clearancexl.co.uk. There are several stores around the country, such as Factory Foods Clearance Outlet in Rotheram, and the Community Shops in Lambeth, London, and Goldthorpe in South Yorkshire. And there is every chance that this sector is set to expand. Certainly if the interest in Approved Foods is anything to go by, there's a huge market just waiting to be tapped.
But what do you think? Does the saving tempt you into buying out of date items? Or would you rather pay more for items at their best? Let us know in the comments.
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