As a 25 year old man who still lives with his mom, I unfortunately do not have the luxury of purchasing organic foods. After all, organic foods are notorious for being more expensive than their average counterparts. In fact, according to a study conducted by Consumer Reports, organic foods were 47% more expensive, with some products like organic zucchini costing 303% more than non-organic zucchinis. However, Organic Garage (OG.V) has extended a charitable hand to those of us who do not necessarily have the deep pockets needed to sustain an organic lifestyle.

Before becoming the illustrious journalist I am today, I worked as a humble overnight merchandiser at Fortinos, a Canadian supermarket chain owned by Loblaw Companies Inc. After spending almost two years stocking shelves, I became well acquainted with the organic foods section. Despite accounting for only a small fraction of the store, the organic foods section always looked like a warzone after a day of shopping. Shelves were pillaged and no carton of almond milk was left unturned. Literally. The demand for organic foods was especially surprising given the price point of most products. For example, Yoso’s Organic Coconut Yogurt costs CAD$5.00 for 400g at Fortinos and CAD$4.27 on sale at Walmart. In comparison, Astro Original Vanilla Yogurt costs a measly CAD$2.77 at Walmart for 650g of non-organic creamy goodness.

With this in mind, Organic Garage is one of Canada’s leading independent organic grocers, committed to offering its customers a wide selection of healthy and natural products at affordable prices. Additionally, customers can use the Company’s bi-weekly Unflyer, featuring in-store specials and clearance deals, to purchase organic products at reasonable prices. As previously mentioned, Yoso’s Organic Coconut Yogurt costs CAD$5.00 at Fortinos, however, Organic Garage’s current Unflyer offers the same product for just CAD$3.47. If you ask me, which you didn’t, that’s a pretty sweet deal.

When he was just 19 years old, Matt Lurie, Organic Garage’s CEO, opened his first Subway franchise, owning and operating three by the time he was in his early 20s. At that age, I was still in university struggling to figure out what I wanted to do with my life. In an attempt to eat my problems away, I would go to Subway almost everyday on my way home from classes, making me one of Matt’s biggest patrons. Meanwhile, Matt was making a name for himself as one of the youngest multi-unit franchisees in Canada. At 25 years old, Matt opened his first Organic Garage location in Oakville, Ontario in 2006. Since then, Organic Garage has established three additional stores in prime retail locations throughout the Greater Toronto Area (GTA) including Vaughan, the Junction and Liberty Village. With that being said, the Company is currently constructing a fifth store in Leaside, which will further strengthen the Company’s presence in Ontario.

In addition to offering organic products for less, Organic Garage features a unique shopping experience shaped by its brand, environment, product and value. Utilizing industry leading technology, Organic Garage has created an urban, modernized, and simple environment for its customers to shop in. Moreover, the Company’s stringent listing criteria ensures that only the best organic products make it to the shelf. With 8,000 to 10,000 SKUs covering a variety of product categories including produce, grocery, meat, bakery, vitamins and supplements as well as health and beauty products, Organic Garage is a one-stop-shop for all your organic needs. If that wasn’t enough, the Company’s Handpicked Partners program offers unique products that can only be found at Organic Garage, providing customers with incentives to shop there.

Cutting to the Cheese

According to Research and Markets, the global vegan cheese market is expected to grow to USD$4.578 billion by 2025, expanding at an impressive CAGR of 8.91%. Hoping to capitalize on this lucrative market, Organic Garage acquired the Future of Cheese (FoC), a company dedicated to developing plant-based cheeses, on March 4, 2021. Following the acquisition of FoC, Organic Garage announced that it would be launching an initial line of plant-based butter, cream cheese, and cheese products in the spring. However, this date has since changed to summer 2021, as outlined in a business update released by Organic Garage on June 9, 2021. So what does this mean?

Although there are some plant-based cheeses and butters available on the market, many of these dairy alternatives contain almost no nutritional value, utilizing fillers like starches, gums and fats. On the contrary, Organic Garage’s initial line of products will be manufactured using the Company’s proprietary plant-based dairy-comparable proteins and top quality, nutrient-dense, sustainable, ethically sourced plant-based ingredients. Keep in mind, Organic Garage and FoC are undertaking the task of creating plant-based, dairy-free alternatives that are intended to be indistinguishable from their dairy counterparts. Without magic, this is likely a process that is going to require time, patience and a whole lot of effort.

Financials & Looking Forward

According to Organic Garage’s Q1 2021 Financial Results, the Company reported a net loss of CAD$907,013 as of April 30, 2021 compared to a net income of CAD$189,403 year-over-year. Organic Garage attributes this loss to decreased sales and non-recurring fees associated with the Company’s acquisition of FoC, among others. In particular, Organic Garage’s sales decreased 12.1% from CAD$8 million to CAD$7 million at the end of Q1 2021. However, Organic Garage was able to increase its cash position significantly from CAD$1.6 million as of January 31, 2021 to CAD$2.8 million as of April 30, 2021. Keep in mind, the Company also rolled out various cost saving initiatives in 2021 including a shift to a decentralized model in April this year, which the Company expects will generate $1 million in savings annually.

Furthermore, Organic Garage took its delivery game to the next level following a partnership with Instacart, North America’s largest online delivery platform. Through an agreement with Instacart, Organic Garage was able to substantially increase its delivery range and online delivery availability to over 2.11 million households in the Ontario market, including markets that were previously not available for delivery such as Mississauga, Milton, Brampton, Newmarket, Scarborough and Pickering, to name a few. If you’re worried about price discrepancies between in-store and delivery, don’t sweat it. Under the agreement, prices on Instacart will reflect Organic Garage’s regularly priced on-shelf and in flyer merchandise.

Why should you care? The global plant-based food market is expected to reach $74.2 billion by 2027, expanding at a CAGR of 11.9%. Needless to say, the plant-based market is growing at an outstanding rate, warranting at least some interest if you’re an investor. Organic Garage achieved some impressive milestones in Q4 2020 and I expect the Company will find similar success in 2021. Although, Organic Garage reported weaker Q1 2021 results, the Company was still able to increase it cash position. Lets not forget, Organic Garage has a loaded gun chock full of plant-based dairy-free cheese waiting to blow. Unintentional innuendo aside, when the Company finally pulls the trigger, it could see massive returns while securing a spot in the profitable plant-base cheese market.

Organic Garage’s share price opened at $0.335, down from a previous close of $0.34. The Company’s shares were up 2.94% before closing at $0.35 today (August 11, 2021).

Full Disclosure: Organic Garage is a marketing client of Equity Guru.