Many of us know Celeste Daily – the company that began as a small-scale operation delivering fresh produce to people’s doorsteps in the early days of our very first Covid-19 lockdown and which has now grown to become a leading online grocery store with over 3,500 products of all kinds available.
Brunch sat down with the brains behind the business, Janik Jayasuriya, for a look at how Celeste Daily came to be, and what it was like building a business in the midst of the pandemic.
Celeste Daily’s origin story
Celeste Daily is a subsidiary of Jayasuriya’s family business, Jaysons Holdings (Pvt.) Ltd., a group of companies involved in property management and development, hotels, restaurants, international investment facilitation, and mineral sands. Little England Cottages by Celeste and Hotel Glendower in Nuwara Eliya are some of Jaysons Holdings’ more well-known projects. In fact, Jayasuriya himself studied hospitality management in Switzerland with the idea of founding his own hospitality venture, Celeste Hospitality. One-and-a-half years into Celeste Hospitality was when the pandemic struck, which was when the Celeste Daily story began.
“Celeste Daily was not something I planned for,” Jayasuriya explained. “It came about out of necessity. I had wanted to do something in hospitality, which was what Celeste was doing, and after one-and-a-half years, we were expanding our team. When the pandemic hit, Jaysons Holdings, as a group, didn’t want to have to let go of people. It was not the time for people to lose a job, and we took action to make sure that didn’t happen.”
Celeste Hospitality, though a subsidiary of Jaysons Holdings, was still Jayasuriya’s brainchild and startup, and initially, the seeds of what would become Celeste Daily began as a temporary thing – a way to get fresh produce of the highlands down to Colombo and to people in lockdown looking for produce. “It was more a social responsibility that we had, but after two weeks, we realised we could make it a business,” Jayasuriya shared. “It was initially cost-to-cost, but after three weeks we realised it was going to take longer to come out of it (the pandemic) and if we didn’t turn it into a commercial venture, Celeste would also have a problem. We had to evolve and adjust with the situation, so we took it as a business venture. We were also, at that point, receiving many requests not to be one of those startups who would disappear after the lockdown because our main line of work had come back.”
A mid-pandemic success story
Celeste Daily formally came to be in May 2020. Like with all startups, the hours were extremely long, Jayasuriya said, sharing that his days would begin at 4 a.m., which was when the first delivery for the day would reach the Celeste Daily offices, and end around 10 p.m.
Some of the biggest challenges in the early days of Celeste were things like getting curfew passes organised for their supply chains to work properly and for staff to come in, getting their hands on packaging solutions at a time when most businesses couldn’t operate properly, sorting out the billing system, while also keeping in mind health and safety, and sticking to corporate values like sustainability.
Celeste Daily started its operations out of a half-renovated restaurant property Jaysons Holdings was planning on opening, before basing themselves out of a house in Attidiya, before finding their current base of operations in Colombo 6. The setting up of their current offices was also a challenge with all of Celeste’s then 33-strong team getting their hands dirty.
For Jayasuriya, on a personal level, as someone leading a startup through an incredibly challenging time, his biggest challenge aside from the fact that he was running an alien business of which he had no knowledge, was keeping people motivated in a time that was immensely tough on people both physically and mentally.
Part of how he overcame both issues was by familiarising himself with all aspects of Celeste Daily and every person’s role within it, working from the bottom up through his whole supply chain. Today, Celeste Daily boasts over 3,600 products (after having started out with 65 products during the first lockdown) and a large team that works tirelessly to maintain Celeste Daily’s core principles: value and sustainability.
“I’ve learned a lot setting up Celeste Daily over the last two years – from dealing with different people to handling business from an e-commerce perspective,” Jayasuriya said. “It’s been a lot of hands-on work. It’s an ongoing process, and I still have to be pretty involved. I still get calls first thing in the morning or late in the night when there is an issue that needs to be resolved.”
The unique challenges of running an online grocery
As an online grocery that functions through third-party delivery aggregators like Uber Eats, PickMe Food, and so on, one of the more unique challenges Celeste Daily faces is managing customer expectations while working through third-party platforms.
“The common perspective and perception is that this is just a place where you (as a customer) place your order and that your transaction is between you and the merchant (the company you have chosen to buy from) and that what the aggregator gets out of it is the delivery fee, and so frustration because of a delayed rider, a missing item, or a refund usually comes directly towards us as merchants,” Jayasuriya explained, highlighting that the reality is quite different. “We are partnered with aggregators to use their customer base as they have large groups of customers on their marketplace looking for different merchants to procure food or products from.”
In exchange, the aggregator handles receiving orders, processing payments, and takes responsibility for getting products to customers in an appropriate and timely manner, charging merchants commission on each item sold to cover their costs of running such an operation. As such, with regard to customer service and disputes, merchants like Celeste Daily often find themselves limited in how they can respond to a customer’s issue. Resolving a payment issue or a refund issue, for example, can take several days or even a week because it’s through a third-party aggregator, and Celeste Daily, as a merchant, has no control on how goods are delivered and for delays that take place once they have handed products over to a delivery rider.
The pricing of products is also impacted when dealing with a third-party aggregator, Jayasuriya shared, stating that the commission charged by aggregators sometimes exceeds the profit margin that item can be sold at, which is when extra fees by merchants like handling fees or convenience fees come into play to allow merchants to recover their costs, something which can also frustrate customers.
“The delivery fee that customers see goes entirely to the rider who rides all the way to a merchant’s location (sometimes three or four kilometres away from the rider’s location) and then takes the products to the customer who is often also another three or four kilometres away, all for that small fee,” Jayasuriya explained, adding that this particular issue is not one that can be resolved without clear understanding from customers on how a merchant’s relationship with its aggregator works.
What’s next for Celeste Daily?
Giving us some insight into Celeste Daily’s plans for the future, Jayasuriya shared his hope for Celeste Daily to form its own e-commerce platform and delivery channel in addition to using delivery aggregators, saying: “I’ve always believed in an omni-channel approach.”
Such a platform would also give Celeste Daily more control over their supply chain and allow them to deal with customers directly. There’s also plans (more long term) for more outlets and a flagship store where customers can shop physically.
