This is a guest post by Arthur Chow, Vice President of S2G Ventures

In trying to envision the future of grocery, we at S2G Ventures go back to how it all began. In 1916, Clarence Saunders opened the first Piggly Wiggly store and changed how people shop for food. The chain’s revolutionary self-service operations, which allowed customers to browse four times the product variety of the average store, unlocked a simple truth: Americans like to pick their own groceries.

While customers were delighted they did not have to wait behind a cramped counter for a store clerk to pick goods off a list, this was also a boon for retailer efficiency. With customers picking their own items, store traffic increased along with basket size from impulse purchases. (Who hasn’t grabbed candy or gum on the way out before?)

For the last century, this is how America has preferred to shop for its groceries, even as the internet became an omnipresent force in other areas of our lives. Prior to 2020, it has been well-documented e-commerce penetration of grocery spend struggled to reach more than 3% of overall spend compared to several other categories that are 30% or greater.    

Then overnight, the COVID-19 pandemic forced all retailers to pivot as previously covered in our Future of Food: Through the Lens of Retail report. Whether curbside pickup or delivery, offering some form of online ordering and fullfilment became table stakes for grocery retailers, with a few notable holdouts such as Trader Joe’s. This stressed the retailers who were not ready to meet the surge in online demand, and showed the cracks in the resiliency of an omni-channel model.  

Online fulfillment, which most traditional retailers had only begun testing 10 months ago, became a problem everyone needed to solve today.

Without the physical and technical infrastructure (which would have required investment years in advance) ready to manage online orders, many retailers turned to Instacart for a capital expenditure-light and scalable solution. But with an industry already operating at 3-5% margin, the 10% commission fee can become a losing proposition. There are no VCs at the beckoning to fund brick and mortar retailers’ growing losses as they effectively pay for the right to each additional order online. Thus, as Bain and others have concluded, supermarkets must invest in fulfillment automation to be profitable. Instacart’s recent layoffs and shift to its “Partner Pick” model, where retailers manage their own physical fulfillment of orders through Instacart’s online portal, further shows the need for grocers to own that part of the supply chain in order to build a profitable and resilient fulfillment model. 

But within that hefty investment decision, retailers are still faced with another choice: should they centralize automated fulfillment in a large facility dedicated to high speed and high volume, or go with a decentralized micro-fulfillment (“MFC”) model and still pick from individual stores? Asked differently, do you want all your groceries sitting in one big automated warehouse, or spread out among many little warehouses (aka your stores) closer to customers?

Enter the origins of Amazon and the supply chain principle it used to disrupt the entire book industry.

One could easily point to Webvan as the poster child of the perils of big-time automation, but that would miss a deeper lesson about logistics that catapulted Amazon. Before having the foresight to invest in cloud computing services, Jeff Bezos understood a basic supply chain principle that led to wild success: niche, specialized and slow-moving products are better suited to be sold online.

Amazon is now referred to as the “Everything Store,” but does anyone remember when it was just a bookstore? And what are most books? Niche, specialized items that consumers buy infrequently (relative to food). 

Why does this principle hold true? Because to minimize a good’s total cost of logistics, one must factor in 1) the cost to hold a product (inventory cost) and 2) the cost to ship a product (transportation or setup costs). Seems simple? To add a bit more complexity, how fast a good sells (its demand) should determine how much of the good to hold and where to hold it. This is a basic principle to forming your supply chain network strategy.

Here’s a hypothetical illustration. Imagine you are searching for a copy of Fluid Concepts And Creative Analogies: Computer Models Of The Fundamental Mechanisms Of Thought. You can shop online with Amazon or in-person at Borders at one of its 500 stores (because this is still ~2010). The publishing industry tracks that only 100 copies are sold on average each year. However, Borders doesn’t know exactly which stores the customer will show up at, so they still stock 500 copies (one at each store) to ensure there are no missed sales or “out-of-stocks.” 

In contrast, Amazon’s one storefront is virtual. They only need to stock 100 copies in a central warehouse to comfortably meet the expected demand. It will cost Amazon more to ship a book directly to its customer, since the Border’s customer helped solve the last mile by shopping at the store. But Amazon saves money on all that real estate cost and, perhaps more importantly, frees up more cash to buy other book titles. In fact, with its online storefront, Amazon can hold millions of titles that far exceed the physical capacity of any bookstore. Finally, the customer also enjoys the convenience of having the book delivered and usually doesn’t mind waiting a few days (again this is 2010). This is how you build an empire in books, CDs, DVDs, consumer electronics, toys, games… and subsequently start the “retail apocalypse.”

Thus, the supply chain concept enabled by the internet and pioneered by a man in a Seattle garage becomes very clear – if you sell a niche, slow-moving good, you should centralize your inventory in a big warehouse, sell online, and ship directly

But a banana is not a book – it is neither niche nor slow-moving, and it spoils a lot quicker. At 85% US household penetration, most people buy bananas and they buy them frequently. As a grocery retailer, you know customers will show up each day to buy food and basic staples with some predictability, 2020 notwithstanding. Groceries are the antithesis to books when it comes to demand, and a grocer’s supply chain should look vastly different to a book seller’s. Delivering bananas to individual homes each day across the US from one central warehouse in Seattle becomes an increasingly expensive proposition as you grow. Logistically with delivery, your customer base needs to have the stable route density of an urban environment to match how efficient a semi-truck is dropping off a trailer load behind a store. Factor in spoilage or damage, and it’s no wonder most of the grocery world still largely exists as brick and mortar.

Thus, this author believes the fulfillment of mass perishable grocery will remain decentralized, whether the customer is shopping online for delivery or coming to the store. For core perishable items reaching a mass audience, having a hyper local focus will be a winning strategy. Micro-fulfillment will be key in allowing retailers to adapt profitably to a changing consumer market. Brick and mortar can still be a competitive advantage in fresh, even with the increasing consumer shift to ordering digital. 

Amazon seems to believe as much. It bought Whole Foods in 2017, a decade after launching Amazon Fresh in 2007 and struggling to gain footing in the grocery industry. Doubling down on brick and mortar, the tech giant has opened up new physical supermarkets in LA and Chicago in 2021.

At the end of the day, 90% of what you buy is likely to have been carried on a commercial truck at some point. For ubiquitous fast-moving goods like groceries, it will always be most efficient to have products sourced from nearby the consumer. Fulfillment of grocery online, whether delivery or pickup in-store, will need to stay local to be profitable.  

Our conversation was a part of our Reimagining Food Retail Conversation Series that was inspired by S2G’s recently released Future of Food: Through the Lens of Retail Report as a framework. The series will examine how innovations in content, commerce and community might transform the shape of the future of food retail.

Join us for future Redesigning Retail conversations here. 

Arthur Chow is a Vice President at S2G Ventures. He is focused on the evaluation and execution of potential investments as well as serving the needs of portfolio companies.

Arthur has nearly a decade of investing and operating experience in the food industry. He began his career as an investment banking analyst at UBS. He then joined Frontenac, a Chicago-based middle-market private equity firm, as an Associate focused on food and consumer buyouts. Seeking to explore an operating role within food, Arthur oversaw the commercial performance of a $2 billion P&L at the Kraft Heinz Company as an Associate Director in the Foodservice business unit. Searching for more early-stage mission-oriented companies, Arthur joined S2G as a Senior Associate. While pursuing his MBA before re-joining S2G, he worked for several food startups with exceptional founders in financial, marketing and operating roles. These include Tovala, a direct-to-consumer smart oven and meal kit service platform; Once Upon a Farm, a cold-pressed organic baby food brand; and Dom’s Market and Kitchen, a next generation grocery retail concept.

The post Where Does Grocery Go Next with Online Fulfillment? appeared first on Food+Tech Connect.

This is a guest post by Tonya Bakritzes, Senior Vice President of Marketing at S2G Ventures.

The unprecedented events of the last year forced food brands to quickly adapt to their customer’s needs and shopping behaviors, while also navigating a rapidly changing grocery retail landscape.  

Last week, Food-Tech Connect and S2G hosted the second conversation in our Reimagining Food Retail Conversation Series to explore how emerging food brands are navigating this pivotal moment in time and growing their businesses through new approaches to customer discovery, acquisition and loyalty. We spoke with Vanessa Pham, Co-Founder at Omsom, Jeremiah McElwee, Chief Merchandising Officer at Thrive Market, Katie Marston, Chief Marketing Officer at Once Upon a Farm and Kelsey Formost, Director of Content Strategy at Tagger Media.

Omsom, Once Upon a Farm and Thrive Market all grew during 2020 and attributed their success to a common set of themes: purpose, customer-focus and community. Tagger has a wealth of data across social platforms and Kelsey Formost shared her perspective on the increasingly important role social and specifically social influencing is playing in the strategy of successful food brands.  All the panelists shared actionable advice and specific techniques that emerging food brands can use to improve their marketing efforts.

The following are some of my key takeaways and favorite excerpts from the conversation.

Access the full video and join us for the rest of our Reimagining Food Retail Conversation Series where we’ll be talking with Walter Robb, former co-CEO of Whole Foods Market, Jody Kalmbach, Group Vice President, Product Experience at The Kroger Co., Birgit Cameron, Head of Patagonia Provisions and Errol Schweizer, Host of The Checkout Podcast, and more about reimagining retail for resilience and to better serve all stakeholders.

Purpose, Allyship & Community Were Keys to Growth in 2020

“This is a really challenging time. Knowing who you are and what you’re trying to do in the world allows you to react and respond quickly, both to serve your customers, but also to do greater good in the world.”

– Jeremiah McElwee, Thrive Market

As a result of Covid, consumer interest in healthier food choices was amplified.  Farmers, producers and food workers became essential workers. The spotlight placed on our food system raised consumer awareness of a complex set of questions about our food, beyond just price and taste, to animal welfare, source and authenticity, environmental impact, and the working conditions and compensation of employees that produced it. Transparency has become critically important.  

Our panelists shared their perspectives on the importance of being very clear in your brand’s mission and how that should direct marketing and communications but more broadly how it gave their companies a north star by which to make critical business decisions.  For Once Upon a Farm, that meant sending the proceeds of their new Farmer Jen’s Sweet Potato Pie product to Save the Children in support of their emergency food relief efforts.  Vanessa shared that Omsom’s mission to honor and celebrate Asian American communities inspired them to partner with iconic chefs of the backgrounds of each cuisine they represent to showcase their flavors and integrate them into the product development process in return for a portion of sales into the future.  Jeremiah shared that Thrive’s core mission and belief structure afforded them the opportunity to create a COVID-19 relief fund that has since grown to $3 million, and use the proceeds to give away free groceries, stipends and memberships to hundreds of families across the U.S.  Once Upon a Farm, Omsom and Thrive Market all experienced significant growth in 2020 demonstrating that customers value brands that take action to live up to their values and want to be associated with that greater purpose.

Customer-Focus: Being an Ally to Your Customer Builds Loyalty

“In 2020, it was about recognizing the need for seamless integration into her life, versus selling. Our customers are very busy moms that were all of a sudden dealing with work at home, school, intermittent childcare at best. We considered it our jobs to make things easier and best in class for her, from where she was going to learn about us, purchase us and try us.”

– Katie Marston, Once Upon a Farm

When Covid shelter-in-place restrictions came into effect, a series of events changed customer’s lives in big and small ways. It’s no secret that more people have been shopping online during COVID. As a result, online grocery penetration rose to 8% in 2020, up from 4% last year. Beyond shopping, people are eating and cooking from home more than ever before, many are juggling remote work and virtual school, navigating the challenges of essential work or dealing with layoffs.   

Our panelists touched on the need for successful brands to play a supportive role in customer’s lives more than ever during this time. Katie shared that Once Upon a Farm started with a focus on their loyal customers. She said, “We went right to the source and concentrated on our current customers over new customer acquisition and worked with our retailers on the retail.com platforms, our own e-commerce, rethinking trade programs and stacking influencers.”  Kelsey shared her perspective on why influencer marketing is such a valuable tactic for reaching customers where they are spending time.  She cited two facts  – that the amount of time we spend on social media doubled in 2020 and that  influencer marketing campaigns saw an 11 times higher ROI, as compared to traditional display ads. Thrive Market has a very curated model and small number of SKUs as compared to the average grocery store, so one way they are constantly adapting to customer needs is through the product mix.  Jeremiah said, ”It’s first and foremost, choosing those brands and finding those partners and finding really compelling, amazing brands and products that we can bring to our members that we know they’ll want.”

Download S2G Venture’ Future of Food: Through The Lens of Retail Report to understand how innovations in content, commerce and community might transform the shape of the future of food retail.

Community: Shifting IRL Marketing to Digital to Acquire Customers and Build Community

“If you don’t have a lot of resources, do not try to talk to a wide audience, be very clear about who you’re speaking to, know what they care about, know their values, know what channels they use, know how they identify and what perspectives they hold. And I think if you can focus on them and get that one community to really care about you, you’re at a great starting point to then have them reach out to their kind of peers around them, and halo out to broader new audiences over time.”

– Vanessa Pham, Omsom

With so many people ordering groceries online, demos and other tried and true in-store marketing techniques weren’t possible. Brands turned to digital channels to acquire customers and build a following for their products.  

Our panelists shared that to build a loyal customer base it is essential to start with a small, targeted audience and not try to appeal to everyone or risk appealing to no one. Once brands have a core group of fiercely loyal customers those advocates can reach adjacent audiences. Vanessa cited RX Bar and Halo Top as examples of brands who started with a niche community of weightlifters and bodybuilders, credible sources in health and wellness, and leveraged their endorsement to expand to a wider audience.

We covered a variety of digital tactics that Omsom, Once Upon A Farm and Thrive Market are using to drive acquisition and build communities. Kelsey noted that social influencer marketing is valuable because it allows you to “reach people who are already predisposed to like you, even if you are a small brand.” 

Katie shared that search has been a valuable technique for acquisition and that they are testing and iterating on their strategy to find specific terms that indicate customer affinity to their products.  As an example she shared that, “We found that someone shopping for kombucha has a high affinity and conversion to buying our types of cold-pressed fruit and veggie blends.” These types of customer insights can be applied to other channels as well.

Jeremiah spoke about how Thrive’s is serving their members online through product discovery.  Their highly curated product mix allows for a simple shopping experience and they continue to invest in optimization of their website’s discovery features.  He also shared that email has been a high performing channel to drive awareness of new products with their members.

Vanessa noted that Omsom’s marketing strategy balances grassroots brand building with paid advertising. She said, “Our sweet spot is actually a hybrid of the two. Where we invest in super high quality and intentional community building.” 

Food Brands Build Trust through Repetition & Consistent Messaging Across Channels

“There’s no perfect attribution model, no algorithm that you can say, ‘This goes to this to this.’ I wish. Digital has helped, but it is all about seeing do all tides rise? And what we saw is when we amplified a really wonderful message about the strength of our brand, we saw even our e-commerce rose. We also saw our retail sales rise. So that halo effect is real. And it’s just about remembering that it is an omni-channel world.”

– Katie Marston, Once Upon a Farm

When the panic buying of March 2020 happened, retailers started rethinking what to put on their shelves and they began prioritizing the essentials and really larger established brands over smaller emerging ones. This caused emerging brands to reassess their strategies for discovery and acquisition, including how to balance investment in marketing to support retail channels versus launching or growing a direct to consumer channel which has a higher minimum price point. For small brands with a minimal marketing budgets, it can be difficult to prioritize and measure the success of their efforts.

Our panelists shared practical advice on how emerging food brands should think about their marketing investments in the light of the ever growing number of commerce options available to customers. Katie reminded us that campaigns for one channel, like D2C, can ultimately lead to sales through another channel, retail. Kelsey shared that, “repetition is recognition and recognition is trust. And you can’t have sales without trust no matter if it’s retail, D2C. You have to show up enough times for a consumer, especially in the absence of a physical trial, enough times for them to know you, like you, and trust you.” Vanessa shared advice on the three areas that food brands need to over invest in: content creation, to communicate what the food looks and might taste like; word of mouth, through product seeding and speaking to the values that resonate with your audience; and communicating a strong brand story to the press who are trusted influencers in food.

Live Selling is the Next Frontier in E-Commerce

“Live selling was a $60 billion industry last year, but the U.S. only accounted for $1 billion of that. We are way behind the rest of the world, which is why we at Tagger are predicting this is going to be the next frontier.”

– Kelsey Formost, Tagger Media

The top question from our community during the session was about live selling, a soon to launch offering from Instagram and Youtube that will allow brands to sell their products live, similar to QVC. Kelsey shares her perspective on the market potential for this new online social commerce channel.

Our conversation was a part of our Reimagining Food Retail Conversation Series that was inspired by S2G’s recently released Future of Food: Through the Lens of Retail Report as a framework. The series will examine how innovations in content, commerce and community might transform the shape of the future of food retail.

Join us for future Redesigning Retail conversations here. 

Tonya Bakritzes is SVP of Marketing at S2G Ventures where she oversees the fund’s brand strategy, marketing and communications and provides strategic guidance to the fund’s portfolio companies.

She has over 20 years of experience working in the technology industry delivering large-scale digital solutions across a variety of industries including Financial Services, Energy, Education and Travel & Hospitality. Her past work has ranged from business planning, consumer research & strategy development to design, build and support of enterprise-scale platforms to marketing campaign planning, execution, and optimization. Tonya has over 15 years of experience working in digital agencies and consultancies as a strategic advisor for clients and 5 years delivering digital programs at J.P. Morgan Chase in the Treasury Services division.

The post How Thrive Market, Once Upon a Farm, Omsom and Tagger Media Are Reimagining Discovery, Acquisition and Loyalty appeared first on Food+Tech Connect.

This is a guest post by Errol Schweizer, Host of The Checkout Podcast, Co-Founder, Board Member For Natural Products Retail and CPG, Writer at Forbes.com and Former Whole Foods VP of Grocery.

Mastered economics ’cause you took yourself from squalor

Mastered academics ’cause your grades say you a scholar

Mastered Instagram ’cause you can instigate a follow

Look at all these slave masters posin’ on yo’ dollar 

-JU$T by Run The Jewels

Covid-19 is the first real stress test that our food system and supply chains have experienced in the 21st century. The pandemic highlighted the deep fissures in the industry and ripped away the pretense of “sustainable food”, and showed that we have made little progress moving past our food system’s origins in plantation slavery, Native American genocide and land theft. The impacts of Covid-19 in the food and agriculture sectors have been felt most acutely by the essential workers foundational to the supply chain. Considering the potential impacts of the climate change related crises that are sure to come, we have our work cut out if we are to fulfill a vision of a more just, sane and sustainable food system. 

We have a responsibility to all stakeholders in our supply chains to pursue deep and substantive change, starting with the social and economic issues that underlie how we grow, make, distribute and sell food. Our inability to accomplish this mission so far has enabled catastrophic death, sickness and misery during Covid-19. Is this the best we can do?

We’ve Failed Our Food Workers

No stakeholder group has carried a greater burden during Covid-19 than essential workers in food service, retail, manufacturing and CPG. The latest data show that almost 83,000 supply chain workers have been sickened with the virus, and over 360 have died. This data doesn’t come near to illustrating the shocking impact of the pandemic on all supply chain workers, such as the hundreds of frontline retail workers that have also died, according to UFCW. 

The federal government failed to protect these workers, and even put them in harms way. OSHA, the agency tasked with protecting workers on the job, completely failed in its role, refusing to issue an enforceable emergency temporary standard. And the Trump Administration exacerbated the dangerous conditions by issuing an executive order last April, at the behest of big meat monopolies, forcing meat plants to stay open despite the rapid transmission of Covid within the plants. The administration later releasing guidance to increase line speeds, which surely sped virus transmission in dirty, crowded facilities staffed by exhausted personnel.

It’s not as though things were hunky-dory before March 2020. Essential workers have faced decades of wage stagnation. If wages had kept pace with productivity, we would have a $24 an hour minimum wage, and not still be haggling for a $15 an hour floor. Seen from another angle, working and middle class people have been robbed of nearly $50 trillion in income since 1975, or over $2.5 Trillion annually. Meanwhile, the top 1 percent of income earners have increased their share from 9 percent to 22 percent in that timeframe, while the bottom 90 percent have seen their share fall from 67 percent to 50 percent. In a year of Black Lives Matter-catalyzed reckonings of race and inequality, do I even need to mention that it’s mostly old white dudes who inhabit that top income bracket? They made money the old-fashioned way, LOL.

The pandemic-induced economic crisis exacerbated these conditions. While over 400,000 died, 67 million folks lost work, 98,000 businesses closed and 1 in 6 Americans, over 54 Million people, were struggling with food insecurity, the Dow hit 30,000 and the collective wealth of 650 billionaires increase by $1 Trillion to over $4 Trillion, nearly double the wealth of the bottom 165 million Americans. And while thousands of individuals, enterprises and non-profits have mobilized to take care of their customers, workers and communities, retailers at the commanding heights of the food system and supply chain leveraged the pandemic to generate enormous profits for a small handful of shareholders and executives, while sharing little with the workers that kept everything going. The wealth of the Walton family alone has grown by $40.7 billion during the pandemic, nearly 26 times the amount of all hazard pay for all 1.5 million Wal-Mart associates in the same timeframe, putting to rest forever the misguided notion that better pay would result in higher prices.

But as Arundhati Roy has written, the pandemic is a portal, a gateway between one world and the next. 

What could that portal lead to in our corner of the economy, in supply chains and the food system?

First, Breathe.

Next, I’d have a banner over that gateway, quoting legendary East Village artist Seth Tobocman, “You don’t have to fuck people over to survive.” 

Then I’d start some civil, yet uncomfortable conversations around what we could do to create and build this fair, just, sane food system and supply chain. The following is a discussion guide to help inform those conversations. You can also join us for Food+Tech Connect’s Reimagining Food Retail Conversation Series and Slack group to have these conversations. Let me know in the comments or on Twitter @grocery_nerd or Instagram @grocery.nerd how it goes.

Got a Vonnegut punch for your Atlas shrugs

-El-P

 

1. A Seat at the Table

Retailers need to give food workers a seat a the table. Unions, the folks that brought us the weekend. Unions, the folks that built the middle class. I grew up around family members, friends and neighbors that were unionized. But what a paradigm, shift I experienced in the natural products sector, not only a curious antipathy to organized labor, but an outright denial of the role that unions have played in our society. It was like another dimension, where the bosses, benevolent for the moment, knew best. Obviously, that moment passed.  

Is it any coincidence that the extreme wealth and income inequalities since 1975 paralleled a similar decline in unionization rates, particularly in the private sector? On the other hand, unions have delivered impressive wins for their members during Covid-19, in particular the Teamsters, UFCW and RWDSU, while also advocating for all essential workers to have hazard pay, living wages, paid sick leave and safer work environments. And workers in supply chain and retail sectors have been getting more restive given the conditions they face, walking out or going on strike to win better gains from employers. As I have written elsewhere , this year promises to be very interesting on the labor front, and history has proven the value of unions for working people, in particular women and BIPOC folks. Black people in particular have much higher wages, better health insurance and pensions when unionized. The PRO-Act, which passed the House a year ago, is the most important piece of pro-worker legislation in decades, promising to introduce enforceable penalties for companies that violate workers’ rights, expanding workers’ collective bargaining rights and strengthening workers’ access to fair union elections. Or as Abe Lincoln once said, “Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration.”

Let’s Discuss: We need to reconsider the resistance to and avoidance of unions and worker’s solidarity. They have proven far and away to have been the best allies for all working people during the pandemic and deserve a seat at the table. What role can your organization play in the struggle for worker’s justice?

2. Farm Worker Justice

We have long exploited farm workers, and a just and sustainable future requires that we rethink the way we treat and pay them. None of us could eat without them. Yet they are among the most exploited and under appreciated members of our supply chain, lacking the basic labor protections that the rest of us take for granted. In 1938, the Fair Labor Standards Act established workplace protections, such as the minimum wage, a 40-hour work week, overtime pay and a ban on child labor. To pass this bill, however, FDR needed to appease Southern Dixiecrats who didn’t want to compensate their workers fairly, so they left farmworkers (and domestic workers) out of the bill because they were primarily Black. Now farmworkers, who are majority Latin American and immigrant, have been exploited by generations of farmers big and small and consumers have been inured to prices not taking into account the dignity and wellbeing of farmworkers. 

Vice President Kamala Harris, whose home state of California passed overtime pay for farmworkers in 2016, has introduced legislation, called the Fairness for Farm Workers Act, that would mandate overtime and end minimum-wage and overtime exemptions. A recent study in Massachusetts added credibility to this bill, concluding that giving workers overtime pay would add just 2 percent to farmgate cost, meaning that while it could easily be amortized into a rounding error by the time a product got to the consumer, it would also mean a 17 percent pay bump for farmworkers. According to Foodtank, farmworker advocacy groups such as Alianza Nacional de Campesinas and National Young Farmers Coalition (NYFC) are collaborating to help secure protections for farm workers impacted by Covid-19. In a letter to congress, Alianza de Campesinas articulated critical concerns: the exclusion of food system workers from relief, addressing food supply disruptions, and the lack of healthcare and economic assistance for marginalized communities, as well as the resurgence of sexual violence faced by women farmworkers. Farmworker justice exists at the intersection of race, gender and class in the food system, and literally none of us would be here now without these folks who are growing and harvesting our food, so it’s time we looked out for them and treated them with the respect and dignity they deserve.

Let’s Discuss: What can we do to ensure that farmworkers are compensated fairly and treated with dignity, even if that means making adjustments to cost structures and value propositions that have been built upon their stress and exploitation?     

3. Confront White Supremacy

I once remarked to Carla Vernón, vice president of consumables at Amazon, that I’ve attended many natural products meetings that were whiter than Ku Klux Klan rallies. And author Raj Patel has a test that he gives food companies: if the Klan took over your business or your board of directors, how much would they have to change? 

As context, Julie Guthman writes, in the United States “land was virtually given away to whites at the same time as reconstruction failed in the South, Native American lands were appropriated, Chinese and Japanese were precluded from landownership, and the Spanish-speaking Californios were disenfranchised on their ranches.” This pattern was repeated in the 20th century, as thousands of Black farmers were displaced or chased off the farms they built after Reconstruction. The consolidation of this rural land for conventional agribusiness production, as well as the cheapness and availability of it for the back-to-the land counterculture that gave rise to the natural products trade, both further entrenched land ownership and food production by and for white people. Is it any wonder that the organic/regenerative sector idolizes Wendell Berry, Sir Albert Howard, or this guy but rarely mentions George Washington Carver, Booker T. Whatley, or Fannie Lou Hamer ?

The point here is that white supremacy is pervasive in the food industry, not only in terms of the ownership, management and governance of most major food and supply chain enterprises, but also in terms of the values, priorities and belief systems. From the conditioned belief in bootstrap individualism that blames health and wellness outcomes on individual lifestyle choices, to the persistent, nagging paternalism of NGO’s and CEO’s telling BIPOC folks what they should be eating. Or the dominant economic dogma that such problems can only be resolved by competition and free markets, like opening glitzy chain stores in gentrifying neighborhoods. It is no wonder that retail stores are heavily policed spaces of racialized trauma, as Dr. Naya Jones says. If I had a dime for every time I heard or experienced a white supremacist-rooted trope in a respectable retail setting over the past 20 years, I’d be retired by now. And it’s very rare that I have worked with any outright sieg-heil’ing knuckle-draggers. The casualness makes it that much more insidious and tough to address. 

But those of us who present as white have the most work to do here: we must confront our privileges, deprogram ourselves and our organizations and question and correct decision making, ownership and financing structures that do little to redress these imbalances in power, talent development and resources in our industry. Back in the 1990’s, some of us anti-racists in the New York hardcore punk scene had a saying: Treason to whiteness is loyalty to humanity. Word.

Let’s Discuss: How can we confront and address white supremacy on an individual level, by looking at our assumptions and biases, but also on an institutional basis, regarding who is making decisions, who is benefiting, and who is left out?

4. Values-based procurement

My chosen trade is retail purchasing and supply chain, and I’ve held these roles at the store, regional and national levels for a range of retailers. I am fortunate to have worked with companies that fought the good fight for ethical and mission-based procurement in the private sector, enabling the development and popularization of Organic, Non-GMO, Fair Trade, humanely-raised and sustainably caught products, categories and supply chains. Likewise, NGO’s working with the public sector have picked up these ideas and run with them, further refining the standards and applying them outside of the retail sectors where they could continue to grow and prosper. 

Leading the way is the San Francisco-based Center for Good Food Purchasing , whose program “provides a metric based, flexible framework that encourages large institutions to direct their buying power toward five core values: local economies, environmental sustainability, valued workforce, animal welfare and nutrition.” (Disclosure: the author has volunteered with the Austin cohort since 2015). 

The standards framework was inspired and influenced by private sector retail folks like myself, as well as community members, trade unionists and elected officials. While its primary use has been for school systems and other public and institutional contracts, the Center’s standards framework is just as relevant to other private sector actors in the supply chain who have not yet started to address these issues. As procurement becomes a hotter employment trend, procurement professionals will need to focus on more than just getting the best cost of goods or quick turnaround times that stress and exploit stakeholders downstream. They will need critical thinking skills and considerations of diversity and inclusion, and this values-based framework will make the roles accountable, holistic, and compelling as a career path in such a chaotic, crisis-prone food system. 

The darker side of procurement is how much of the supply chain utterly failed to take into account ethical issues in supplier management during the pandemic. Every single worker death at a meat processing plant or produce operation was immediately followed by a purchase order from a retail or wholesale customer, whether they were mass market chains, natural food stores or smaller, specialty distributors. There were no ramifications in the supply chain for hundreds of deaths and thousands of illnesses, communities stressed and wrecked, families shattered. Business kept grinding on, workers kept getting sick and dying. 

This isn’t the only way. The Coalition of Immokalee Workers, a Florida-based and farmer-led standards and advocacy organization, has negotiated legally binding contracts and codes of conduct with buyers that articulate clear penalties for growers who abuse their workers or create conditions that lead to sickness and death: the growers lose the business. According to a 10 year, longitudinal study by Harvard University, such worker driven initiatives are the most effective way to establish responsible supply chains, particularly by giving workers a seat at the table. Greg Asbed, co-founder of CIW, recently told me; “If you have a lot of purchasing power, you can demand more humane conditions, you can demand compliance with fundamental human rights in your suppliers’ operations, you can improve the lives of millions of people… if you decide to wield that same volume purchasing power for good as opposed to evil. All of this comes together to form an actual enforcement of the rights in the Fair Food Code of Conduct. That’s the power of the purchase order.”

Greg also laid it all out for us pretty starkly, “Whatever they call social responsibility in the food industry has been a joke, a fraud… it is absolutely empty and soulless and unreal. It is everything that has not worked and has been done for public relations purposes for the corporations, not the workers. That all became clear when Covid came down and all these outbreaks came to the press, did any of the buyers step up and say that we can’t allow this to keep happening? Not one.” 

The frameworks and best practices for values-based procurement have already been stress tested, and it protects and empowers the stakeholders most prone to abuse otherwise while assuring the supply chains function optimally. We just need more retail and wholesalers to get with it.

Let’s Discuss: Values-based purchasing was birthed in the natural channel, but has been stalled and watered-down in the greater food industry. With its adoption growing in the public sector, how can we make these standards foundational to our whole food supply?

5. Worker ownership and a solidarity economy

Ownership and governance are two major hurdles for racial and economic justice in the food system. Fortunately, there is a movement afoot to diversify the wealth and decision making power for enterprises, and there is significant historical precedent and momentum. Worker ownership models, such as employee stock ownership plans (ESOP’s), worker cooperatives, employee owned trusts, perpetual trusts and multi-stakeholder cooperatives are becoming more popular, particularly among millennials and younger BIPOC workers who have been marginalized and exploited in traditional corporate environments. The benefits are many for all involved, including greater employee engagement, better company performance and better employee wellbeing and happiness, and are well documented across thousands of such enterprises. This includes familiar brands like Bob’s Red Mill, King Arthur Flour and Equal Exchange, or international icons such as The Mondragon Cooperative Complex and John Lewis UK. There are also dozens of scrappy startups involved with USFWC and NYC NOWC, values-driven businesses that are putting worker and community benefit at the core of their purpose. This should be a familiar clarion call to those of us in the natural products trade. 

The financial considerations for employees are well documented, with household net wealth 92% higher for employee-owners than for non-employee-owners; employee-owners having 33 percent higher median income from wages; employee-owners are much more likely to have great benefits, including flexible schedules, retirement plans, access to childcare, parental leave, and tuition reimbursement; and employee-owners having substantially more job stability than non-employee-owners. The model is also spreading to the tech sector and flourishing among website and mobile app developers who are getting wise to the predatory and extractive practices of unicorn tech startups. 

Many of the folks in this sector are looking beyond the atomized marketplace they must function in and building networks towards a solidarity economy, a 21st century version of the cooperative commonwealth that social reformers envisioned in the Gilded Age to overcome poverty, exploitation and racism by creating networks of like-minded enterprises that could supply and support each other. And in the shadow of the silver tsunami of baby boomer business owners facing retirement, Alternative Ownership Advisors, who recently helped Organically Grown Co. transition into a perpetual trust model, has articulated a set of legislation needs to enable the growth of the employee/worker owned sector, including tax incentives for business owners, incentives for capital providers to finance such enterprises and encouraging more states to allow these enterprise forms to legally incorporate.

How do we make worker and employee ownership norm? 

These are just a few ideas that I’ve been noodling on recently. As someone who is pretty busy supporting a number of mission-driven retail, CPG and NGO enterprises, I have been privileged to keep a roof over my head and food in the pantry. I have had the time and energy on nights and weekends to consider the current crisis, research and articulate what we could do differently from here on out. 

I know and love so many wonderful colleagues in natural products retail, supply chain and startup land who are committed, energetic and well-resourced to remake society towards justice, equity and sustainability. But I am also deeply anxious and skeptical that those of us who have stayed healthy, housed and employed will not anticipate and prepare for the next crisis, especially in solidarity with those on the frontlines that are bearing the highest costs. I am very concerned about the resistance we will face from vested interests, reactionaries and conspiracy theorists who can’t see past their own short term self-interest. Covid-19 is doing a lot of damage and we should consider it a preview of what’s to come. Climate change is here, and there will be no mask mandates or vaccine rollouts that can save us from the growing threats of wildfires, superstorms, rising sea levels, mold epidemics and ocean acidification. We can only imagine how these climatic events will drastically impact the folks who are already disempowered. We have yet to correct, resolve and heal from these power imbalances. There’s a shit ton riding on this and we have work to do. 

Let’s Discuss: What are your learnings from this crisis and what is your commitment to building supply chains that are fair, just, sustainable and transparent?

Join us on February 4 for an interactive discussion on how retailers might better support all of their stakeholders needs around transparency, equity, diversity, health and sustainability with Errol Schweizer, Host of The Checkout Podcast, Co-Founder, Board Member For Natural Products Retail and CPG, Writer at Forbes.com and Former Whole Foods VP of Grocery, Sam Polk, CEO at Everytable, Gerardo Reyes Chavez, Coalition of Immokalee Workers, Greg Asbed, Co-Founder at Coalition Of Immokalee Workers, and Jessica Murphy, Business Development Manager at S2G Ventures.

Join us for future Redesigning Retail conversations here. 

Born and raised in The Bronx, Errol Schweizer brings more than 25 years of experience in the natural and organic food movement. Errol is a Board Member and Strategic Advisor for over a dozen food and retail brands, including Good Eggs, Merryfield, Farmer Direct Organic, Ka-Pop’s and Nuttzo. He is also a co-founder of Goodfish, Basics Market, Mood33, Herbl Distribution, and BeyondBrands, as well as Good Catch, a plant-based seafood analogue. Errol previously served as the Vice President of Grocery for Whole Foods Market, leading the merchandising, purchasing and product assortment for more than 80 categories and $5 billion in annual sales. His team enabled many progressive, innovative companies to become mainstream, including Vital Farms, Beyond Meat, Siggi’s and Saffron Road, as well as shepherding more than 10,000 items through Non-GMO Project Verification. Errol was named a retail game-changer by Supermarket News and received a Lifetime Advocacy Award from Hemp Industry Association. He is the co-founder and host of The Checkout Podcast, a show that centers the efforts of working class and BIPOC folks on the frontlines of our food system.

The post 5 Actions to Reboot Food Retail appeared first on Food+Tech Connect.

This is a guest post by Kelsey Formost, Director of Content Strategy at Tagger Media.

Food+Tech Connect and S2G Ventures are partnering to host Reimagining Retail, a series of conversations exploring how this unprecedented moment in time will shape food retail over the next five years. 

Without the ability to drive product trial through in-store demos and sampling, brands have been forced to rely even more heavily on digital means to drive customer discovery. 

While influencer marketing was already a pretty commonplace tactic for brands, in 2020 it became even more essential for brands to work with trusted content creators across social platforms to drive discovery of their products. 

Social media has always been ingrained in our daily lives, but according to a recent study, 72% of social media users report spending significantly more time per day on social media. Before covid, the average American was consuming an average of 3.5 hours of social media time per day. After covid, that number has nearly doubled to six hours a day, on average.

Beyond increasing screen time, Covid accelerated our comfort with using social media as a means of discovering and purchasing new products. In fact, because of a surge in on-platform shopping, we’re predicting that all major social platforms will be adjusting their algorithms to boost product discovery and eCommerce in 2021.

Tagger Media, the influencer marketing platform I work for, helps connect brands with the most valuable content creators for their campaigns so they can get their products in front of the right audiences. Over the last year, we found that brands who increased their investment in influencer marketing were able to more seamlessly transition into a pandemic economy and social landscape. By partnering with influencers and meeting consumers where they already were, brands were able to stay top of mind with their existing customer base and drive discovery for new leads. 

In advance of the Reimagining Discovery Conversation on January 21, we wanted to share some of the key learnings from 2020 to help brands increase their ROI by leveraging influencer partnerships and staying ahead of upcoming industry trends.

Learning #1: Consumers are increasingly looking to influencers for recommendations and deals

Data shows consumers are purposefully seeking the opinions and recommendations of influencers before they make a purchasing decision. Influencer Marketing Hub reports that 91 percent of millennials trust online reviews as much as they trust recommendations from friends and family. A survey by BrightLocal shows 95 percent of consumers aged 18-34 seek out online reviews before making a purchase, reading an average of 10 reviews before they feel they’re able to trust a brand.

Not only are consumers seeking out the opinions of online creators, they’re actively looking for discount codes and product links from influencers they trust. When it comes time for a consumer to purchase, they often return to the source of discovery – in this case, the influencer – to complete that “last click” step and add the product to their cart.

Recent data shows that long-term partnerships performed best for brands in 2020 which allowed brand campaigns to build momentum with a dialed-in audience. Repetition builds recognition, recognition builds trust, and trust creates sales. 

Most marketers are aware of the statistic that a viewer needs to be exposed to something an average of seven times before they opt in. Investing in a long term influencer partnership ensures you’re getting your product in front of the right audiences (on the right platform) enough times to drive real-life purchasing decisions. 

Learning #2: Social media algorithms are changing to reflect new spending habits

In order to maximize success with influencer marketing, it’s important to consider upcoming algorithm changes that might affect your campaign reach and engagement. Last year brought a massive increase in consumer comfort with online shopping which led every major social media platform to create new opportunities to incorporate eCommerce into their user experience.

We expect that consumers’ social media shopping behavior will be even more heavily weighted in upcoming algorithm updates, ensuring that users are served influencer content that more specifically aligns with their past purchases.

We’ve already seen these changes taking effect. With their accelerated launch of Shops back in May, Facebook made it clear that their priority is eCommerce. Instagram’s much-publicized addition of a “shopping” tab to the home screen announced similar intentions. With eCommerce so well-blended into the social media experience, the algorithms will inevitably adjust to track consumer shopping behavior to better inform the platform what kinds of content and ads to serve.

Influencer Marketing Case Studies for Food Brands

Now let’s dive into specific examples of how a few food brands we work with that were able to leverage influencer marketing to drive discovery and growth, even during a global pandemic.

Using our technology, these brands were able to hone in on specific audiences that were pre-disposed to respond positively to their products. With access to accurate, real-time social data, companies are able to streamline and scale their influencer discovery process, partnering with the top creators for their specific goals.

Poppi @drinkpoppi  

Pre-biotic soda brand Poppi is an excellent example of a brand that was able to immediately increase awareness and reach after partnering with influencers. This graph shows Poppi’s social health before and after running an influencer campaign. Before, Poppi was averaging a potential reach of around 10,000. After the influencer campaign, Poppi saw a reach of over 1.5 million. That’s a growth percentage of 15,000%.

Four Sigmatic @foursigmatic

Four Sigmatic is a wellness company that touts the benefits of “the world’s most nutrient-dense ingredients” with the world. You can see in this graph how their reach and engagement spiked in direct relation to their sponsored mentions. This means that when Four Sigmatic invested in sponsored influencer content, they saw a huge spike in conversations being held about them in the online community.

Tate’s Bake Shop @tatesbakeshop

Lastly, let’s take a look at how user-generated influencer content can drive engagement for food brands on social media. Tate’s Bake Shop has partnered with nano and micro-influencers to drive huge engagement numbers, with engagement rates of up to 5 percent – that’s more than double the industry average. When brands partner with influencers, they’re getting more than just well-done content, they’re getting direct interaction with that influencer’s audience, upping their own engagement rate in the process.

Driving Discovery with Influencer Marketing

Influencer marketing provides brands with higher value leads at a lower cost per lead, produces a higher ROI that any other form of marketing, takes the cost of content creation out of the brand’s pocket, and helps work around ad blockers. But one of the most valuable results of influencer marketing is its ability to drive real-life purchasing decisions, encouraging consumer discovery off-platform.

When an individual follows an influencer, they are part of a curated community. When a brand is able to tap into that community via influencer marketing, they also tap into that influencer’s hard-earned trust. When an influencer shares a positive recommendation with their dialed-in audience, that audience is more likely to be open to ordering products they have yet to physically try, simply because those products are recommended by someone they trust.

In a digitized world, influencer marketing provides a high ROI that not only drives sales, but accelerates discovery among new audiences allowing food brands to scale in a pandemic economy.

Join us on January 21 for a conversation with Vanessa Pham, Co-Founder of Omsom,  Jeremiah McElwee, Chief Merchandising Officer of Thrive Market, Katie Marston, Chief Marketing Officer at Once Upon a Farm, and Kelsey Formost, Director of Content Strategy at Tagger Media, to discuss how leading food brands and retailers are increasing customer discovery, acquisition and loyalty in this new normal. 

Join us for future Redesigning Retail conversations here. 

Kelsey Formost, Director of Content Strategy at Tagger Media

Kelsey Formost is the Director of Content Strategy for leading influencer marketing platform, Tagger Media. Her work and expertise in the digital content and influencer marketing space has been featured by Business Insider, Refinery29, Glamour, and more. This year, Kelsey was named a ‘Rising Star’ by industry leader Talking Influence on their ‘Influencer Top 50’, a curated list of the Top 50 global individuals in influencer marketing. Kelsey is also an experienced speaker, presenting at high profile events such as HubSpot’s Inbound2020 conference and SXSW 2021.

The post How Food Brands Are Using Influencer Marketing to Drive Discovery & Acquisition appeared first on Food+Tech Connect.

This past December, we partnered with S2G Ventures and gathered over 370 entrepreneurs, executives, investors and industry professionals for an interactive discussion exploring the future of food retail with Walter Robb, former co-CEO of Whole Foods Market and Audre Kapacinskas, VP of S2G Ventures. The conversation explored how retailers might leverage cutting edge technologies and stakeholder-focused business models to build a 21st century food system.

Some of the key topics we discussed:

• What they learned in 2020 that transformed the way they think about food retail.
• If they were to start over, how they would design a 21st century grocery store to better serves all stakeholders.
• Overview of S2G Ventures’ thesis on content, commerce and community shape the future of retail over the next 5 years, and the most promising areas for investment.
• How automation, robotics, omni-channel and smart fulfillment will impact retail, as well as how retailers should be thinking about technology adoption.
• New opportunities that might be unlocked across the value chain by tapping into increased e-commerce data about people’s shopping behaviors and preferences.
• What leading with heart means for the food industry.

We also explored some great questions from the community, including:

• John Foraker, CEO of Once Upon a Farm: How do you see conflict between every store becoming an online distribution center and consumer desire for retailer theater and in-store experience playing out?
• Peter Droste, Independent Experience Designer: What do you do specifically to practice and cultivate your agility and curiosity?
• Mike Hotz, Business Developer of Carma Chocolates at Barry Callebaut: What chances do you see for small producers in micro fulfillment solutions bypassing traditional retail?
• Mike Lee, Co-CEO of Alpha Food Labs: Where do we find the sweet spot in our food system between large, consolidated production models and smaller, more decentralized production models?
• Harry Rhodes, Executive Director of Food Animal Concerns: How can farmers get their fair share by selling through retail? How can we make it worth it for them to work with retailers?
• Andrew Mayne, Senior Associate Director of Culinary Arts at Stanford University: Do you think the retail companies of the future need to have a different ownership structure, a move towards community based ownership or co-op based ownership?

Join us For the Reimagining Food Retail Conversation Series

This was the first in our new Reimagining Food Retail Conversations, a series of discussions exploring how this unprecedented moment in time will shape food retail over the next five years that we’re co-hosting with S2G Ventures. Our goal is to create a space for stakeholders from farm to fork to come together to discuss how we might fundamentally reimagine food retail to make it more resilient, equitable, accessible, diverse, delicious, healthful and climate-smart.

Join us for the rest of the series from January 21 – February 18 where we will be exploring how we might reimagine grocery for discovery, resilience and to better serve all stakeholders. For our conversation on January 21, we will be joined by Vanessa Pham, co-Founder of Omsom, Jeremiah McElwee, chief merchandising officer at Thrive Market, and Katie Marston, chief marketing officer at Once Upon a Farm, and Tonya Bakritzes, SVP of marketing at S2G Ventures, to explore the various new approaches retailers and emerging brands are taking for customer acquisition and discovery.

You will also be able to participate in ongoing conversation with the community through our slack group. RSVP for Reimagining Food Retail today!

Bonus: What People Are Reading to Self Educate Themselves

There was a great discussion in the chat about what people are reading right now to self educate themselves. Here are some of the books and articles mentioned:

• S2G’s The Future of Food: Through The Lens of Retail Report
• Audre’s Blog Post: S2G Ventures on the Future of Food Retail
• Conscious Leadership, by John Mackey
• On Food and Cooking – The Science and Lore of The Kitchen, By Harold McGee
• Let My People Go Surfing, by Yvon Chouinard of Patagonia
• We Fed an Island by Jose Andres
• The Formula: The Universal Laws of Success, by Albert-László Barabási (read community member Allison Geller’s summary)
• Salesforce acquires Slack, DeepMind’s AlphaFold breakthrough, Trust Fund Socialists & more
• Know when to fold ’em: How a company best known for playing games used A.I. to solve one of biology’s greatest mysteries

The post Walter Robb & S2G’s Audre Kapacinskas on the Future of Food Retail [Video] appeared first on Food+Tech Connect.

We’re at the beginning of a new food revolution. COVID-19 has shone a light on the vulnerabilities across our food system and created an imperative to reimagine what is possible. In the face of the pandemic, eaters have begun demanding greater diversity, transparency, health, safety, convenience and accessibility in our food supply. This new reality is changing the relationship between retailers, brands and eaters, while also accelerating innovation and the adoption of technology across every part of the value chain.  

We are thrilled to be partnering with S2G Ventures to bring the best and brightest minds together to understand how this unprecedented moment in time might shape food retail over the next five years. Using S2G’s recently released The Future of Food: Through the Lens of Retail Report as a framework, we will be hosting a 4-part interactive conversation series exploring how innovations in commerce, content and community will transform the industry. Our goal is to create a platform for discussion and collaboration, a place for people from diverse backgrounds from farm to fork to come together to explore how we might create a more resilient, equitable, diverse, delicious, healthful and climate smart future.

How to Participate

We’re creating a platform for discussion and collaboration, a place for people from diverse backgrounds from farm to fork to come together to explore how we might create a more resilient, equitable, diverse, delicious, healthful and climate-smart future.

You can attend individual sessions or purchase an all access pass, which gives you access to our dedicated community Slack channel where you will be able to connect with others to discuss how to navigate the evolving grocery retail world.

All of our conversations are highly interactive and include 45 minutes of live Q&A with our speakers via Zoom.

Virtual Conversations

Walter Robb & S2G Ventures on The Future of Retail | December 10, 2020 |  2-3:30p ET [Free Event]

Join Walter Robb, former co-CEO of Whole Foods Market and executive in residence at S2G Ventures, Audre Kapacinskas, vice president at S2G Ventures, and Danielle Gould, founder of Food+Tech Connect, for a conversation about how retailers might leverage cutting edge technologies and stakeholder-focused business models to build a 21st century food system grounded in trust that better connects consumers to their food.

View the full video from the discussion here.

Content: Reimagining Discovery | January 21, 2021 | 12:00-1:30p ET

In response to the panic buying of March 2020, retailers began to rethink what they put on their shelves. They prioritized the essentials, and larger, established brands over smaller, emerging ones. In a pandemic era grocery store, demos and other tried and true in store marketing techniques no longer work, which has further hurt emerging brands. Today, brands are being forced to rethink how they find and attract customers. This conversation will explore the various new approaches emerging brands are taking for customer acquisition and discovery.

Speakers:

• Vanessa Pham, Co-Founder at Omsom
• Jeremiah McElwee, Chief Merchandising Officer at Thrive Market
• Katie Marston, Chief Marketing Officer at Once Upon a Farm
• Kelsey Formost, Director of Content Strategy at Tagger Media
• Tonya Bakritzes, SVP of Marketing at S2G Ventures

Community: Reimagining Grocery To Better Serve All Stakeholders | February 4, 2021 | 12:00-1:30p ET

The US’s top 20 grocery stores represent over 70% of the retail market. They are gatekeepers of our food supply chain and have had profound impacts on what food is produced and by whom, as well as the health and wellbeing of their staff and communities. This discussion will explore how retailers might better support all of their stakeholders (ie their customers / neighborhood, employees, brands, farmers, etc.) needs around transparency, equity, diversity, health and sustainability. We’ll also look at the ways digitization and digital storytelling are changing retailers’ responsibility to and their relationship with their stakeholders.

Confirmed Speakers:

• Errol Schweizer, Host of The Checkout Podcast, Co-Founder, Board Member For Natural Products Retail and CPG, Writer at Forbes.com and Former Whole Foods VP of Grocery
• Sam Polk, CEO at Everytable
• Gerardo Reyes Chavez, Key Leader at Coalition of Immokalee Workers
• Greg Asbed, Co-Founder at Coalition of Immokalee Workers
• Jessica Murphy, Business Development Manager at S2G Ventures

Commerce: Reimagining Grocery For Resilience | February 18, 2021 | 12:00-1:30p ET

The pandemic has expanded how and where we shop. Conventional grocery retail initially struggled to meet the demand shock caused by pantry loading. Consequently, many consumers turned to online grocers, meal-kits, farm e-commerce sites and other delivery services that were once seen as niche. In this discussion, we will examine how some of these food retailers have pivoted business models or adapted supply chains to enable them to be more resilient and better serve their customers’ needs around convenience. We will also examine what may have staying power as conventional retailers invest in omni-channel and smart fulfillment strategies to solve the last mile.

Confirmed Speakers:

• Jody Kalmbach, Group Vice President, Product Experience at The Kroger Co.
• Birgit Cameron, Head of Patagonia Provisions
• Rob Twyman, Executive Vice President at Whole Foods Market
• Moderated by Walter Robb, EIR at S2G Ventures

The post Introducing The Reimagining Food Retail Conversation Series appeared first on Food+Tech Connect.

Source: S2G Ventures’ The Future of Food: Through The Lens of Retail

This is a guest post by Audre Kapacinskas, Vice President at S2G Ventures

Food+Tech Connect and S2G Ventures are partnering to host Reimagining Retail, a series of conversations exploring how this unprecedented moment in time will shape food retail over the next five years. 

Why Now? How the Pandemic of 2020 is reshaping grocery retail, why today is different and what it will change about how and what we eat. 

The pandemic of 2020 is shining the brightest of lights on our present day food system and exposing both its resiliency and vulnerabilities. No industry touches more aspects of our lives than food – it employs 11 percent of our population, represents 10 percent of household expenditures, underpins our social fabric and directly relates to the health of our communities and planet. Over the last 100 years, we have developed a massive food supply chain that is efficiently humming in the background of our everyday lives – delivering food consistently, cheaply and without question. Over the last year, cracks emerged across our food system and showcased some of the tradeoffs we have made over the last century — efficiency at the cost of resiliency; scale at the expense of variety; price at the expense of value; globalization at the expense of our local communities. 

At the same time, Covid-19 accelerated trends that had been percolating for years – expanding digital footprints, refining e-commerce offerings, exploring automation opportunities. As Covid-19 persists and retailers continue to forge ahead, the pandemic is separating the leaders from the laggards. New technologies and behaviors are becoming engrained and we are crossing a chasm from which the industry will not return unchanged. 

Taking online grocery shopping as an example, the last 30 years have seen a slow evolution. Peapod was founded in 1989 – despite requiring customers to physically download software, the company had enough buzz to go public in 1996 but ultimately closed its digital doors in February of 2020 (ironically). Webvan received its first order in 1999, spent $1 billion building distribution centers in 2000 and closed in 2001. Instacart was founded several years later and offered a more accessible, hybrid model for consumers and retailers that connected physical and digital. Despite these fits and starts, online grocery sales remained low – 3-5 percent of total grocery in the US. As Covid-19 persists, it is influencing behavior and offering a real opportunity to make online grocery shopping a meaningful part of our food system – projections estimate that 1 in every 5 grocery dollars will be spent online in 2025. Today’s emerging digital models are underestimated in their ability to change how, what and why we eat what we eat.

While we have built a massive supply chain, when we compare the capital that has flowed into other sectors like pharma or technology, food pales in comparison. For decades, the food industry has been underinvested, under appreciated and under digitized. Today, we have the opportunity to reimagine it taking into account technology advances, consumer preferences and impact to our economy, planet and health. We are at a distinct moment in time where critical infrastructure is coming together, technology costs have decreased and consumers are open to behavior change. Internet usage reached critical mass in 2000 in the US; the iPhone was launched in 2007; falling sensor costs are driving the proliferation of personal and IoT devices which in turn are contributing to the exponential rise of data – we have 44X the amount of data today than we did a decade prior. As we think forward to the next 100 years of food and retailing, there is opportunity to reimagine sourcing and verification, go-to-market channels and market places and ultimately who controls access to the market and the products that will win in the next century. 

The increasing role of technology in retail transcends the growth of e-commerce during the pandemic. It will impact not only where consumers buy, but how and why they buy. It is within this context that we at S2G Ventures see opportunity to build a better food system by integrating content, community and commerce, which we outline in full in our Future of Retail Report. By leveraging cutting edge technologies with stakeholder-focused business models, we have an opportunity to build a 21st century food system grounded in trust that better connects consumers to their food.

Commerce: How emerging sales channels and new operational approaches are enabling 21st century business models and building a more resilient food supply chain.

In the early days of the pandemic, vulnerabilities across our food system emerged – from early stock-outs, to stories of infected workers to euthanized pigs. As consumers, we were confronted with the limitations  of supply chains built for affordability, consistency, efficiency and safety. Using the meat industry as an anecdote, in the last 45 years the number of meat plants has been cut in half; in the US three pork processors control nearly two thirds of the pork processing capacity and four beef processors control nearly three fourths of beef processing. In some ways, consumers benefited from the greater access to cheap, safe, abundant food that this vast system enabled. According to ERS, “the average share of disposable personal income spent on food by Americans fell from 17.0% in 1960 to a historical low of 9.5% in 2019.” In other ways consumers became increasingly disconnected from food producers and more exposed to highly processed and less nutrient dense foods. This supply chain made sense for grocery retailers who also faced consolidation and were often competing on price. In 1996 the 20 largest grocery retailers represented 42 percent of the market; in 2018 they represented over 70 percent. 

While today’s grocery retailers have more power than ever, the industry is concurrently becoming more complex as lines between physical and digital blur, new capabilities and organizational structures are required and relationships between consumers, sellers and producers evolve. Just as the television networks began to be disintermediated in the early 2000’s, the food system is beginning to experience a shift. Consumers are engaging across a variety of platforms and expectations are carrying over from other industries. If Netflix can serve-up content that is tailored to my tastes and preferences, why can’t the food providers in my life do the same? 

Customer expectations around convenience and personalization are forcing retailers to do more, carry more, manage more as they compete with a new set of players. As complexity in grocery retail increases, retailers are digitizing their operations and investing in robotics, automation and smart fulfillment to improve the economics of personalization and convenience. The omni-channel evolution is changing the supply chain and even organizational structures – overhauling existing divisions between “digital” and “store” teams to create a unified approach both internally with their teams and externally with their customers. In some instances, the physical world is mimicking the digital as stores are being reconfigured to reflect online organization and digital footprints.

In addition to increasing organizational complexity, there are also supply chain shocks to manage. In 2019 there were 337 food safety recalls in the US. This highlights an opportunity for retailers to add value and resiliency by moving up the value chain. To enable transparency across our supply chain, we need better data and interoperability. The FDA is actively working on refining industry standards and many retailers have taken it upon themselves to work with their suppliers to put these systems in place. As concerns around sustainability, climate change and resource availability mount, there is another path to explore resilience: controlled environment agriculture (CEA) or “indoor ag.” A number of partnership models have arisen between retailers and CEA farms, ranging from hub and spoke organic models to operational improvements to bring down the cost of indoor produce to hyper-local agriculture. These new approaches to food production reduce freight cost, better balance supply and demand, improve sustainability and can even repurpose under-utilized real estate. Technology advances have made this opportunity more real than ever before. Advances in LED lighting systems, IoT capabilities, seed breeding platforms, to name a few, continue to make the economics of indoor agriculture compelling. With more controlled systems, there is opportunity to introduce more variety, more nuance that could not withstand the traditional supply chain. Through initiatives like better data from growers and indoor agriculture, retailers can shape not only what food is on a shelf, but how and where it is produced. This is reimagining the fresh perimeter and unlocking a more nutritious, sustainable and transparent food system for 21st century consumers.

The competitive landscape is evolving quickly for food retail. Traditionally, grocers competed with grocers. In the last decade we saw dollar stores (e.g. Dollar General) and general merchandisers (e.g. Target) establish greater footholds in food retail as a means to drive store traffic. During COVID, the food retail space grew increasingly noisy. Restaurants, farmers and brands were forced to seek new sales channels as restrictions, SKU rationalizations and tightening supply chains disrupted previous paths to market. New sales platforms and technologies offered flexibility and matched consumers with their desired food supply – from restaurants becoming local markets to brands selling through social media platforms. The consumer is no longer limited to what is available at their local supermarket; they are expecting more and have never had easier access to products that fit their needs and wants. This enables much more nuance in demand and supply – from locally produced food, to methodologies of production, to subscription-based convenience and nutrition for toddlers, to managing health conditions, to supporting local economies. Niches that previously fought for a spot on a retail shelf, are forging their own path to their customer.

The last mile continues to challenge economics. To enable convenience, new capabilities are required to shift massive infrastructure into more flexible deployments. A recent analysis by Bain laid out various sample scenarios: traditional grocers doing their own picking in store experienced -15 percent margins; those picking from a warehouse experienced -8 percent, 3rd party services improved margins to -5 percent. Ultimately, to get to profitability, automation and micro-fulfillment are necessary. By proactively laying the groundwork from the bottom up of a distribution model that takes last mile delivery into account, the economics begin to look more reasonable long-term but require significant capital upfront to invest in automation. 

Target has been a leader in the digital arena, making digital a priority for the company. As CEO Brian Cornell stated in 2017: “We’re investing in our business with a long-term view of years and decades, not months and quarters. We’re putting digital first and evolving our stores, digital channels and supply chain to work together as a smart network that delivers on everything guests love about Target.” Target’s conviction around this strategy has been paying off: in Q2 2020 it reported a 24 percent surge in sales (their largest increase, ever) and 195 percent growth in digital. This paired with partnership strategies with players like Ulta Beauty to reimagine space and expand serviceable footprints both digitally and physically are positioning the retailer well. While the economics of last mile delivery are being sorted out, hybrid offerings like click-and-collect are providing convenience to consumers while maintaining economics for retailers. Kroger was playing catch-up in the e-commerce space early in the pandemic, but has successfully accelerated a number of programs. Kroger’s buy online, pick-up in store (“BOPIS”) program is currently offered across 2,100 locations; this has contributed to the 127 percent increase in e-commerce sales in Q2 2020. To enable this model, Kroger is leaning into a partnership with Ocado to enable automated micro-fulfillment and improve margins for click-and-collect and delivery. Tomorrow’s supply chain will be built from the ground-up, with last mile delivery and automation being core considerations. These changing dynamics offer new partnership opportunities around technical capabilities (robotics; data; AI) and financing (CAPEX). 

Join us on December 10 for a conversation with Walter Robb, former co-CEO of Whole Foods Market, Audre Kapacinskas, Vice President at S2G Ventures, and Danielle Gould, founder of Food+Tech Connect, to discuss how retailers might leverage cutting edge technologies and stakeholder-focused business models to build a 21st century food system. RSVP here.

Content: How reimagining product discovery can unlock opportunities for true product differentiation across taste, nutrition and function.

How do your parents decide what food to buy? While brands have more ways than ever to reach their customers, the way retailers enable product discovery is not so different from the first self-service grocery store 104 years ago. Shelf placement, in-store promotions and branded packaging were pillars of product discovery and key to the success of products in a pre-pandemic grocery store. There have been improvements to this discovery model, for instance, Whole Foods offering a community experience in-store by highlighting local / regional products and a “third place” to gather, but the model has remained largely unchanged for the better part of a century. 

Today, we see two models at play. First, a legacy model that focuses on scale and volume. This top-down approach gives the broker and buyer control and positions the retailer as gatekeeper of shelf placement, which in turn determines brand exposure to consumers. The second model takes a bottoms-up approach and focuses on user needs and product attributes (verified organic, gluten free, etc). As the world continues to increase in complexity, centralized decision making will reach its limits. Keeping up with shifting preferences will require an open-source approach to curating products – retailers will need to think differently about category management, relationships with brands (including their own private label) and community engagement.

As consumers do more online, retailers must reimagine product discovery from the ground up, using data to better tailor products for consumer needs. Without granular data retailers will be unable to compete with digital platforms that understand user needs, wants and can begin to anticipate them. Amazon has written the playbook on this in other industries and is increasingly interested in the food space through its new grocery formats and delivery services. Data is critical because it enables the sales channel to add value to their consumers by reducing noise and surfacing content that is relevant to them in the moment. For those in the business of food manufacturing (branded or private label), it also offers an innovation path. As data about products and consumers improves, we will be able to better match attributes with needs. Companies like Thrive Market and Good Eggs are exploring new models that are built from the ground-up – aggregating data about ingredients, production methods, holistic product specifications –  and can offer nuance, discovery and specificity that traditional models cannot. There is a long way to go to scale these concepts for the mass market, but they offer a glimpse into an attribute-based system where a dad looking for peanut-free snacks is not reviewing the nutritional labels of 15 boxes, but rather can review a curated set of products based on his needs. These models are also more brand-friendly, offering them better data and discoverability.

The concept of retailer as gatekeeper is changing. As more digitally native brands launch and leverage new selling platforms (e.g social media channels and e-commerce sites), brands can understand their consumers at a level of granularity nearly impossible in-store. This will enable brands to emerge that are laser focused not only on selling their products to consumers, but on understanding their motivations and iterating on new products based on the data they collect. Whether it’s a busy mom trying to find snacks for her child with an allergy or a baby boomer managing a recent diagnosis of osteoporosis or a Gen Z looking to vote with their pocketbook around sustainability. As the grocery channel becomes digitized, there is an opportunity to move beyond the ‘buyer’ model in which a single individual determines what is made available to consumers, but rather an open source approach which can cater to the preferences of various communities and curate products based on function, authenticity and needs. This model is unlocked when we have a bottoms-up understanding of our products and our supply chain. In this new digital context, authenticity has never been more important. And for investors, it will be the brands who are able to develop these kinds of relationships with their customers that will be the most compelling investment opportunities. 

Another, longer wavelength variable to consider is the impact of biometric data being more widely available to consumers. Today, 21 percent of Americans use a smartwatch or fitness tracker. As this number expands, the intersection between food and wellness becomes more concrete at a personal level. The ability to pair personal biometric data (e.g. your blood pressure is 140 today, 10 percent higher than last week) with information coming online about ingredients and products will enable people to make more personalized decisions about what food they buy and why. Personal and IoT devices unlock new forms of engagement that enable the collapse of physical and digital worlds and offer bi-directional digital interactions between consumers, producers and retailers. This will create a feedback loop of information sharing that can unlock new discovery processes and product innovation.

As material science, genomics, food production and other technologies advance and we dig deeper into a treasure trove of better flavors and nutrition, we stand at the precipice of high throughput product innovation and true differentiation. We see some of this happening already – partnerships between retailers and heirloom seed breeders; cancer treatments paired with specifically bred plants; natural blue dyes that are price competitive with synthetic colorants; tomatoes that don’t taste like cardboard; more nuanced strains of cannabis. We have been living in the world of black and white television and we are about to go to HD Color. Just as the online world has gotten noisier, the food world is begging to experience the same, and it is the role of the retailer to help their customers navigate the 21st century food system. Retailers are poised to play a critical role in understanding customer needs, tailoring products that suit them and conveniently making them available. 

Community: Tomorrow’s business models recognize the ecosystem we are part of and are built on trust across customers, employees, suppliers, local communities and shareholders.

As we move deeper into an era where sales channels are more fluid and consumers have the opportunity to discover products and purchase them through a variety of means, customer engagement is more important than ever. Millennials and Gen Z, a demographic of 150 million, are overtaking Baby Boomers in their purchasing power and their values are poised to have an impact on the trajectory of business. According to a recent Deloitte study, 80 percent of millennials and seventy percent of Gen Z said they will make an extra effort to buy products and services from smaller, local businesses to help them stay in business post-pandemic. Sixty percent of respondents plan to buy more from large businesses that “have taken care of their workforces and positively affected society during the pandemic.” Tomorrow’s consumers are looking to spend their money with organizations they trust.

According to Edelman’s ‘Trust Barometer,’ ethics are 3 times more likely to drive trust in business rather than competence. In this context, engagement across a variety of stakeholders is more important than ever. In 2019 Business Roundtable redefined its statement on the Purpose of a Corporation – showcasing how engagement across all shareholders is imperative to long-term success. Key tenants to building a community include delivering value to customers, investing in employees, dealing ethically with suppliers, supporting local communities and generating long-term value for shareholders. Humana’s Bold Goal of improving the health of the communities they serve by 20 percent by 2020 is an example of supporting local communities.

“By taking a broader, more complete view of corporate purpose, boards can focus on creating long-term value, better serving everyone – investors, employees, communities, suppliers and customers,” said Bill McNabb, former CEO of Vanguard. Retailers are in a unique position; having been a cornerstone to local communities they already occupy a trusted position among their customers. While trust exists it cannot be taken for granted, it needs to be earned on a daily basis. Whether it’s the products a retailer chooses to carry, how they maintain the health and wellness of their employees, support of community organizations, or enabling the health and wellness of the customers they serve. In an era that is going to have more information and optionality than ever better, being a trusted participant in your community is critical.

In the march toward low-cost production, we lost sight of some of the upstream and downstream impacts of our food system. Today’s burgeoning consumer class is increasingly paying attention to those considerations. Given advances in technology, data, food production methodologies and e-commerce platforms, there is an opportunity to improve our food system, to think holistically about the communities we are serving and drive long-term sustained results for business. 

Looking Ahead: A 21st century food system grounded in trust

As 2020 draws to a close and we set our sights on a new year, we stand at the crossroads of what was, is and will be. New technologies are shortening the space between consumer and producer and as Gen Z and Millennials gain economic power and vote with their pocketbook, trust is more important than ever in what, how and why we buy what we buy.

Commerce

• Physical and digital worlds are blending together; integrated teams and systems focused on the holistic customer journey are key to providing consistency, flexibility and trust.
• Retailers are moving from gatekeeper to tailor; as digital sales channels become more common retailers can differentiate and add value to consumers by leveraging data and curating products.
• Food producers, brands and food service providers have an opportunity to sell in new ways to their consumers and benefit from better data and direct user feedback.

Content

• Online product discovery needs to be improved.
• Health and wellness are top-of-mind for many – as more functional ingredients come online, truly differentiated branded and private label products can build trust with consumers.
• Data is laying the foundation for tomorrow – having a data strategy is more important than ever.
• Complexity is increasing – in order to keep up, you need to decentralize and partner.

Community

• Trust is the currency of the 21st century food system. This needs to be earned through data, verification, consistency, transparency and authenticity.
• Long-term resiliency and value will be achieved through broad stakeholder engagement with customers, employees, the local community, and shareholders. 
• Values have never been more important – as Millennials and Gen Z gain economic clout, they are looking to align their spending power with their values. 

Channel digitization, advances in automation, new approaches to food production, the proliferation of data, new customer engagement models and the evolution of societal norms provide an opportunity to revisit some of the tradeoffs we made in the past century. Food is unique in its ubiquity. Everyone eats, and as the food supply chain evolves, we have an opportunity to build a system based on trust that is good for the health and wellness of consumers, producers, local economies and the planet.

Join us on December 10 for a conversation with Walter Robb, former co-CEO of Whole Foods Market, and Audre Kapacinskas, VP of S2G to discuss how retailers might leverage cutting edge technologies and stakeholder-focused business models to build a 21st century food system. RSVP here.

Join us for future Redesigning Retail conversations here. 

Download S2G’s The Future of Food: Through The Lens of Retail Report here.

___________________

Audre Kapacinskas, Vice President at S2G Ventures

Audre Kapacinskas is a Vice President at S2G Ventures, where she focuses on unlocking value for S2G, its portfolio companies and strategic partners. Throughout her career, Audre has worked at the intersection of technology, strategy and operations to incubate new ideas and drive growth across organizations.  Prior to S2G, Audre was a Director of Sales and Corporate Strategy at a predictive analytics start-up delivering artificial intelligence and IoT solutions to the Industrial sector. She started her career at a boutique strategy consulting firm working with private equity firms and corporate clients with growth acceleration, value assessments and investment diligence. Audre is a Fulbright Scholar, holds an Honours BA from the University of Toronto and an MA from Vilnius University.

The post S2G Ventures on The Future of Food Retail appeared first on Food+Tech Connect.

This is a guest post by Jomaree Pinkard, Co-Founder & CEO of Hella Cocktail Co.

Check out our Food & Ag Anti-Racism Resources.

Dear Colleagues,

As a Black Man in business, I have to be extremely careful in both professional and public settings. When I’m trying to make a point, I often have to decide whether I should be direct or performative in my delivery — because my decision, to be honest, can come across as too assertive or even intimidating in the workplace. There is an unwritten rule for black professionals that asks us to speak in a language that others might find more appealing to their sensibilities. In many settings I’ve often had to minimize thoughts to remain poised or what others might deem as “on point,” because my passion in presentation can be mistaken for aggression. If I am too assertive, I can pay the price — and that price can be all too real.

I grew up hearing that I would always need to work twice as hard to get half as much, and keeping these ideas to myself has been over time half the battle. Until today.

For many professionals of color, this sentiment — of minimizing what we know to be real about our lives in business — will ring true. But we also recognize that we can use this moment of societal inflection as an opportunity to actually pivot in business; we can redirect the course for black and brown talent, stories, and industry. We can disrupt how systems have been designed to keep black people in place, silenced, and positioned to avoid risk.

As a black man who grew up in an under-resourced neighborhood in the heart of New York City, I inherently faced nothing but risk and uncertainty daily. I know intimately how challenging it is to break the color barrier in school and at work, when and how I have to prove my worth — and carve out a path toward accessing socio-economic change. In order to find success, black professionals like myself have to put much more on the line to succeed by risking our opportunity to speak, our chance to present, our ability to grow, and our reputations all at once. However, in order to make progress, we must take risks, so here I am putting it all on the line one more time.

I want to state clearly that the system is not failing the status quo — the system is maintaining the exact operation it was designed to uphold. Black people have been maligned in American business for centuries, only given the opportunity to toil and labor, or tend to lower-wage jobs while industry grows more complex and advances. Still, and rarely are Black Americans able to find themselves the business owner. When asked if “my success in the food and beverage industry is the result of drive, hard work, and timing,” I answer “yes” to all three — however, I also recognize that several opportunities have come my way as a result of intentional and deliberate system navigation — challenging the status quo and finding a way in — despite being pushed out, omitted or overlooked, the color of my skin notwithstanding.

Now, in reflection as a successful black entrepreneur and business owner, I recognize that my life, my health, my education and the opportunities that have been afforded me as a result of schooling at the University of Virginia in Charlottesville and The Wharton School of Business are not examples of triumph, but are holes in the system that was designed to hold me back. My success is its failure. American business and industry weren’t designed for me or my family to be healthy or supported, to be highly educated, or to establish an entrepreneurial career with Hella Cocktail Co. The system wasn’t designed for me to raise my family in a flourishing neighborhood, or to support and invest in other black business owners’ dreams and ambitions. It has actually been designed to hold us back, and only now because we are at this juncture in history — might we realize that we have an opportunity, or rather a duty to upend this appalling process.

So the questions I have been pondering and propose to you — the questions the system-owners are now being posed and have to reckon with are these: Will you continue to support a system that is designed to force others to fail? Or will you help to dismantle and redesign it to allow for black and brown people to enter in business unhindered? Will you assist in creating opportunities for black people to develop sustainable business models, create jobs, support families and livelihoods, and invest in black business owners — their dreams and ambitions?

If you are willing and haven’t already begun to explore concrete action items, here are four discrete practices you must do to ensure your platform or business is prepared to support black lives mattering.

Practice #1: Listen, Acknowledge Trauma, & Self-Educate

“The goal isn’t perfection, it’s presence!” “The first step is to show up.” ~ Ashtin Berry

There is no perfect playbook for standing face-to-face with inequity, injustice, and oppression while running a business or an organization. Talking about race, racial violence, racism, and the Black Lives Matter movement is the first step. Embracing the complex history of our country is necessary for us to better understand, heal, and change. There are many resources that can help you better explore the dynamics and the voices at play. Educate yourself on American history — the issues of people of color, women, people with disabilities, LGBTQ+ communities, religious minorities, and other marginalized groups, and understand the compounding effects from challenges faced by individuals and communities who inhabit intersectional identities.

There is a shared trauma that impacts communities, our nation, and everyone’s bottom line. For an example of a business in action, Ben & Jerry’s has done its homework throughout the years while actively participating and taking strong social and political stances. As a leader in today’s world, you are grappling with complex change on many levels while trying to understand human dynamics that can feel untranslatable, conflicting, and often painful to your employees and your customers. We must each dismantle and rebuild the entire system together, or choose to do the work independently, and bring back that new knowledge to our companies to invite change.

Practice #2: Investigate Your Internal Impact

“Equity begins with representation.”

Grocery retailers demand door over door metrics, food and alcohol distributors demand minimum case per week turnover, bars and restaurants fiercely rely on the average cover per seat, and investors don’t even place their bets until they are able to verify any of this historical data to measure traction before investment. Somehow these metrics have been omitted when it comes to diversity and inclusion beyond gender. Our companies and organizations feel the impact of the world around us, whether it is apparent to each individual within our ranks or not. It is necessary for us to respond to the challenges of American history, as well as the current climate, and redesign systems and environments where our employees can not only survive — but thrive.

Large multinational spirit companies need to realize that it’s in their best interest to prioritize a culture that is not only equitable and inclusive — but also responsive to the pressing needs of the communities served with their business. From the busser to the boardroom, it is absolutely paramount that fine dining establishments and large restaurant chains seek opportunities to reflect the diversity of the communities served on all levels. Bon Appetit and Epicurious accepted the resignation of their former editor-in-chief, and admitted to being complicit in ‘tokeniz[ing] many BIPOC staffers and contributors” to make their brands appear more diverse; the company also acknowledged its effort in “dismantling the toxic, top-down culture” by “prioritizing people of color for the editor-in-chief candidate pool…and resolving any pay inequities that are found across all departments.”

Starting with the application and vetting process, and working with those that hold the door open or closed, companies must put themselves in a position to seek out and discover talent that has been left behind or that the organization hasn’t yet had the network to discover. The time to hold your company responsible for this task is now.

Practice #3. Scrutinize Your Community Impact

“Donate AND be active in the life span of your contribution.”

Statistics show that 91 percent of consumers believe brands should do more than make a profit; they should address social or environmental concerns, too. While it is intrinsically the right thing to do, this is also the precise reason why during the current pandemic companies have donated everything from free virtual meeting platforms and wifi for schools to contactless free food and beverage delivery. Communities support business because there is an implicit social contract that the community will patronize your establishment in exchange for you offering the best goods or services — with the condition that you continue to represent the best interest of the community.

But what happens after the special event or ribbon-cutting ceremony is over? Charitable donations to organizations such as Color for Change, The NAACP Legal Defense and Educational Fund, Black Lives Matter, and The National Museum of African American History and Culture, among many others, are undoubtedly and immensely important. However, the reality is that we in the black community are hesitant to believe in these monetary postures because we know these are often one-time donations to clear consciences, and only uphold the status quo in moving forward.

Like all other business initiatives and investments your organization makes, community-directed donations need to be looked at through the lens of a business investment similar to launching a new product, or vertical or brick and mortar location, rather than a bottom-line optimizing tax write-off. In the past week, retailers Target, Walmart, Kroger, and H-E-B and spirits producers Pernod Ricard along with Diageo have begun to either donate or set up internal funds to address racial inequalities and injustice. We are hopeful that these social impact-driven funds won’t simply lean in the direction of one-time investments but will create self-sustainable business practices that facilitate growth of reinvestments in the community.

Practice #4. Provide Access and Investment

“Donations are icing on the cake. The CAKE is what’s most important!”

In the U.S. hospitality industry, 60 percent of the sector is made up of people of color, yet black and brown hospitality professionals occupy less than 7 percent of managerial roles. On the small business front of the food & beverage industry, many venture capital firms are onto their 2nd, 3rd, or 4th venture funds — which means they are only interested in companies that are already hitting the $10 million-plus revenue run rates to deliver on meaningful rates of return. What this really means is that there is truly no small business investing present. Overall, the venture industry’s track record on accessibility when it comes to diversity and race fares even worse: only 3 percent of investment partners and 1 percent of founders of venture capital-backed firms are black.

Each of these sub-segments of the industry has a systemic problem that starts at who is hired for entry-level positions and extends to the investors who serve as limited partners to venture funds. The reality for black talent in business is that barriers to participation emerge in every part of the marketplace: the requirements of an elite or private education, family lineage, pedigree, or upbringing are more important than a stellar resume or previous experience. This has always been the case.

While you must continue to donate to organizations that align with your values, now and more importantly, the primary method to change the systemic barriers to access for black professionals is to invest in black-owned and black-led businesses throughout the industry’s value chain with transparency and accountability. Although they are primarily tech investors, Softbank’s newly announced ‘The Opportunity Growth Fund’ to the tune of $100 million states that they will “only invest in companies led by founders and entrepreneurs of color,” meanwhile, Andreessen Horowitz’ The Talent x Opportunity Fund (TxO)’ for underserved communities “are now looking for black, women, minority founders to invest in.” These moves are more in line with the direction the food and beverage industry should follow.

5 Strategies to Move Your Food, Beverage & Hospitality Industry Business to Equity

Once you’ve built in the basics in your practice, you have set the stage. Next, there are the 5 strategies your business can set in motion so that you are part of the movement, and not just responding to the moment:

1. Build a Continuous Diversity Evaluation Process: Being proactive in fighting racism and bias means creating structures and systems within our own ranks to ensure the voices of all members of our workforce are heard and that the needs of our employees are met. Avoid systematic jargon that checks off the diversity-box. If it sounds like “we will provide anti-racism/bias training” or “we will bring in a third party to help conduct company-wide diversity workshops,” you haven’t finished listening. The system — including how you evaluate and dismantle systemic barriers to participation in your business — needs to be built into the company and reassessed with frequency. It is not a person, it is a process.

2. Commit to Accountability: I propose that all organizations who are now publicly saying that Black Lives Matter demand a similar commitment to holding themselves and their peers accountable by being more transparent about where they are in terms of the diversity of their teams and portfolios, benchmarking themselves against their peers, explaining their strategy, adopting KPIs and milestones, and then sharing their progress in an open and transparent manner. From entry-level merchandisers and restaurant servers to the editor-in-chief and board seats; be accountable with respect to how you operate as a business and seek out opportunities to reflect the diversity of the community. Commit to equity on all levels.

3. Invest Your Donation: Investments create ownership, ladders for progress, and accountability throughout an organization’s entire value chain. Like all other business initiatives organizations make, donations need to be looked at through the lens of a business investment rather than a charitable contribution. Those steps include but are not limited to: cultural and historical research, consumer insights and how they impact your community, the alignment of team values, concept development, idea testing and fit, measurement of successes and failures, and, most importantly, reinvestment. Investments are sustainable and have growth metrics around them. You know the drill.

4. Update Your Investment Thesis: Your investment thesis is an inaccurate overestimation of how rational your investments are. In fact, the thesis is mostly built on the basis of the group’s collective trust. That lack of trust is why investments in black-owned businesses are so low, and why access is non-existent. I challenge VCs and strategic funds to alter their investment thesis, and then invest. Think outside the box.

5. Pledge 15% to a Timeline: Black people in the U.S. make up nearly 15 percent of the population. Commit to investment proportions that align with the population over a 1, 2, and 5-year time horizon.

• Media & Trade: Take a pledge to allocate a minimum of 15 percent of your coverage to black talent and businesses,
• Retail: Take the 15% pledge to allocate a minimum of 15 percent of retail shelf space to black-owned businesses,
• Hospitality: Take a pledge to allocate a minimum of 15 percent of bar and restaurant menu placement to black-owned businesses,
• Beer, Wine & Spirits: Take a pledge to allocate a minimum of 15 percent of your portfolio of investment, innovation and distribution network to black-owned businesses,
• Venture/Strategic Investors: Take a pledge to allocate a minimum of 15 percent of your investment portfolio to fund food, beverage, and hospitality entrepreneurial ventures to black-owned businesses.

In your process, you will make mistakes. It is better to move forward with the intention to dismantle and change the status quo than to stand still and wonder why things are imperfect and unbalanced. That is my charge as well.

While it is true that as a Black Man in business I have been extremely careful in both professional and public settings, I have also opened many of the proverbially closed doors and sat in many of the least desirable seats. My daily journey of attempting to gain access to menu and shelf space, capital, and networks has been difficult; but my story of continuing to navigate a flawed system is still hopeful, despite exhaustion and loneliness.

This isn’t about me alone though, by any means. Nope! It’s about those who don’t have the access, who may not have had the opportunity for higher education, or who may never make enough connections to get into the room where decisions happen. For those of us who have: it is time to listen, learn, and acknowledge the centuries-old trauma of systemic inequity endured by black individuals and communities. It is time to redesign a system that truly values the health, education, careers, and ambitions of black people. It is time to disrupt the old system and immediately commit to more equitable actions: invest money, commit to coverage, pledge space, support black-owned, and reward risk. It’s time to use this moment of inflection as an opportunity to redirect the course for black lives — which have always mattered.

Sincerely,

Jomaree Pinkard | CEO & Co-Founder, Hella Cocktail Co.

This post originally appeared on Medium.

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Jomaree Pinkard’s career journey has taken him from helping to develop and implement The Salvation Army’s September 11 World Trade Center Recovery Program to consulting for the NFL. In 2012, he became the Co-Founder and CEO of a minority-owned craft cocktail company, Hella Cocktail Co. In eight years, he and his partners have grown a hobby into a nationally distributed premium-quality food manufacturer producing a line of nonalcoholic cocktail mixers, bitters, and newest innovation Bitters & Sodas that make it easier and more accessible to craft delicious drinks at home or behind the bar. Jomaree is a graduate of the University of Virginia’s McIntire School of Commerce and also earned his MBA from The Wharton School of Business at the University of Pennsylvania.

IG: @jomareepinkard

The post 5 Steps to Move Your Food, Beverage or Hospitality Business to Equity appeared first on Food+Tech Connect.

Elly Truesdell

This is a guest post by Elly Truesdell, Partner at Almanac Insights

On the evening of March 2nd, the natural foods industry got a preview of its future. Natural Products Expo West,  the industry’s biggest event of the year and one of the key opportunities for emerging brands to connect with retail buyers, was cancelled in light of COVID-19, a day before it was set to begin. What felt like a major blow to brands at the time, now seems small in what’s been lost, and under much larger threat, just eight weeks later. After years of losing market share, America’s biggest food companies are reporting record earnings, cashing in on panic buying and consumer uncertainty. This comeback puts intense pressure on the natural foods industry to prove and clarify its value as we enter a new economic reality; the country’s health depends on it.

The last decade has been nothing short of a natural foods renaissance, and a heyday for the industry’s consumer packaged goods (CPG). An estimated 200,000 new food and beverage products have been introduced in the past decade, according to the USDA. And more than $17 billion in annual U.S. CPG industry sales have shifted from large players to small ones since 2013. These numbers express the hope of the last decade: better goods, better health. I put great trust in this movement to transform America’s food system, my career was built on its rise.

As Local Forager and Global Director of Innovation for Whole Foods Market, I scouted the up and comers, and I launched emerging brands across the retailer’s 500 stores for nearly a decade. I witnessed and helped build a better food movement, born with purpose. Entrepreneurs seized the opportunity to upend traditional, legacy brands that produced cheap and often nutrient-poor foods. These new companies pushed consumers to compare ingredients, nutritional panels and production standards to those of their larger forbearers.

The first wave of disruption focused on the “artisanal,” with an emphasis on craft and quality of production. Whole product categories – cold brew coffee, Greek and Icelandic yogurt, bean to bar chocolate – were born. The next, much bigger wave focused on a set of “alternatives.” The market for plant-based and allergen-free products took the industry by storm, as brands like Beyond Meat and Califia Farms replicated and replaced dietary staples, free-from cows. And trending icons – Siete, RxBar, Spindrift – started to define how a set of Americans eat, snack and sip.

While the number of new brands flooded the market, so did the investment dollars. Over $1.45 billion was invested into natural food and beverage startups in 2018, a near ten-fold increase from 2010. Almost in correlation, health promises became increasingly questionable, and a whole new language of symbols and buzzwords was developed to explain their benefits (non-GMO, cruelty-free, good for heart health). Innovation across all food categories exploded with this newfound money and interest. Each diet trend – paleo, keto, Whole30, low carb – churned out stables of products for their followers and fans. What started as a movement committed to organics, simple ingredients and producing cleaner goods, tipped in the direction of lifestyle marketing and promotional puff.

Even after a decade that saw a proliferation of new products and functional foods, America’s health is worse than ever. The rate of adult obesity continues to increase, up to 42.4 percent from 35.7 percent in 2010. And according to the USDA, only 10 percent of Americans are meeting the daily recommendation for fruits and vegetables. Our supply chains haven’t caught up either. Seventeen out of 20 top food retailers are not adequately meeting the increased consumer demand for organic food, according to an evaluation by Friends of the Earth. And as a point of scale, the acreage of organic produce in the U.S. is still less than one percent of the country’s total.

COVID-19 is now exposing what we should have seen all along: the natural foods industry has yet to meet its tremendous promise and must do better. A movement that began with substance – offering new and better products for personal and environmental health – has lost its way. It has become more popular to innovate for the sake of innovating, rather than solving problems for the everyday consumer. The onslaught of “better for you” brands has, in many ways, obscured the movement’s true value and size of its gains.

As we enter a new economic normal, America is being forced to re-examine how we eat and how we spend our money. To assess what we truly value. These decisions come just as America’s biggest food companies are attempting to reassert their dominance in our fridges and pantries. In April, Nestle reported its biggest quarterly sales growth in over five years, and Campbell’s – makers of Campbell’s soup and Pepperidge Farm cookies – posted a surprise earnings increase of 10.77 percent for the quarter.

This sudden shift puts even more pressure on the best food brands to show what’s behind their labels. The easiest way to cut costs and deceive taste buds is to add emulsifiers, natural and artificial flavors, gums, and other preservatives – Big Food’s traditional playbook. The brands that have rejected those short cuts, mastering flavor and ingredient integrity at scale, are providing a better service to our lives and long term health; no easy task.

Brands with purpose and worth, now more than ever, must find a way into more households, prove their merit and become indispensable. They must reach past their standard set of consumers, beyond disposable incomes, and broaden their distribution. Over 95 percent of shoppers in the United States say they seek healthy food options, yet only 28 percent say it’s easy to find these products, according to a report from the International Food Information Council (IFIC). And in terms of access, America’s two largest Dollar Stores – Dollar General and Dollar Tree – sell more food than Whole Foods nationally.

Amid the devastation of this pandemic, there is hope for a better food future. What’s been percolating even before the crisis is some incredible progress in food innovation: companies providing access, connection, transparency and new forms of distribution. I’m encouraged by businesses going beyond consumer brands, investing upstream in infrastructure and flexible manufacturing. The best brands still to be built are those that embrace and respect the land, growers, and processors that support them.

While still early, the latest wave of progress toward transparency holds incredible power – putting equal pressure on big and small food companies to take responsibility and be held accountable for America’s health. In fact, we’re all accountable. Investors, retailers, growers and buyers have a commitment to improve the system, invest in its foundation, and inspire change. America’s food industry is positioned for its next transformation, and the solutions brought today, the most important yet.

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Elly Truesdell is a Partner at Almanac Insights, a venture capital fund investing in consumer food and technology. She built her career over a decade at Whole Foods Market, as Global Director of Local Brands and Product Innovation.

The post Grocery Wars: A Natural Foods Reckoning appeared first on Food+Tech Connect.

Image: Andriy Bezuglov

This is a guest post by Elizabeth Tilton is the founder and CEO of Oyster Sunday

In this time of unprecedented crisis for the restaurant industry, many operators are turning to alternative revenue sources, like gift card sales and GoFundMe campaigns, to create relief funds for their employees, the majority of whom they have been forced to lay off of furlough in the past few weeks. While these are immediate solutions to immediate needs, restaurants should be aware of the tax implications on their business in order to help guide their decision making.

Below you will find resources we’ve compiled to help restaurants navigate these alternative revenue sources and their tax implications.

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Overview of Tax Implications

Gift Cards

Taxability of Gift Card Sales

Restaurants selling gift cards should review state laws [here] and the regulation of redemption (i.e. gift cards cannot expire within five years from the date they were activated). It is also critical for restaurants to ensure that they are appropriately recording income from gift card sales, and below are three options for doing so [source 1]:

• Cash basis method – Income is recorded on the tax return in the year in which it was sold.
• One-year deferral method – Income is recorded at the earlier of either the redemption of the gift card or one taxable year following the sale of the gift card.
• Two-year deferral method – Income is recorded at the earlier of either the redemption of the gift card or two taxable years following the sale of the gift card.

Taxability of Giving Gift Cards to Employees as a Form of Payment

If a restaurant gives a gift card to an employee as a form of payment, that is considered taxable under IRS code section 102 [source 2].

Redemption Terms

Restaurants should strongly consider creating redemption terms for gift cards, particularly as they start to think about reopening their doors because this will directly affect their cash flow. It may be wise to think about terms that explicitly state guests can redeem gift cards a certain amount of time after the purchase date (i.e. six months after).

GoFundMe Campaigns

Small Business Relief Initiative

GoFundMe.org recently created the Small Business Relief Initiative to help small businesses that have been affected by the COVID-19 pandemic, and will issue matching $500 grants to qualifying businesses that raise at least $500 on GoFundMe. There should be no tax implications for the GoFundMe Small Business Relief Initiative per the following statement on its website:

“There should be no tax implications because you have established that you are a small business negatively impacted by the COVID-19 pandemic. GoFundMe.org will not require any goods or services to result from the grant; instead it is provided to you as a gift. That said, we cannot provide you any tax advice as everyone’s situation is different and tax rules change from time to time. We recommend you speak to a financial advisor.” [source 9]

Beyond the Small Business Relief Initiative

Generally speaking, GoFundMe is required to file a Form 1099 for campaigns that receive over $20,000 in donations or more than 200 total donations.

There is conflicting advice from those who have received large donations via GoFundMe about how the IRS processes the amount, but to be safe it is always best to report amounts over $20,000 as a 1099 since GoFundMe will be reporting it as well. Restaurants should record the 1099 income as income, and then on another income line, report an offsetting reduction and add a short explanation, such as:

“All amounts reflected in the 1099-K are excludable from income under IRC Section 102. These amounts reflect the money the taxpayer received as the result of gifts from donors. Those gifts were used to pay [XX] of the taxpayer and are excludable from gross income.” [source 10]

The taxable amount is completely dependent on the donated amount.

501(c)(3) Organizations

A large number of restaurants are deciding to create or partner with 501(c)(3) organizations in order to accept tax-exempt donations that they can give directly to their employees. A 501(c)(3) organization is a corporation, trust, unincorporated association, or other type of organization exempt from federal income tax under section 501(c)(3) of Title 26 of the United States Code.

One of the primary benefits of being tax-exempt under IRC Section 501(c)(3) is the ability to accept contributions and donations that are tax-deductible to the donor. Additional benefits include, but are not limited to [source 11]:

• Exemption from federal and/or state corporate income taxes
• Possible exemption from state sales and property taxes (varies by state)
• Ability to apply for grants and other public or private allocations available only to IRS-recognized,
• 501(c)(3) organizations
• Potentially higher thresholds before incurring federal and/or state unemployment tax liabilities

More information about exemption requirements for 501(c)(3) organizations is available on the IRS’s website, as well as a step-by-step application which includes questions and answers that will help an organization determine if it is eligible to apply for recognition of exemption from federal income taxation under IRC section 501(a) and, if so, how to proceed. Please consult your CPA for additional information.

Allocation of Funds

What are the implications of distributing gifts to employees / individuals (both those who were laid off or furloughed) with the money donated by gift cards or GoFundMe campaigns?

If restaurants distribute gifts to employees and the money is in exchange for services, such as using these funds to pay employees who are helping with delivery or cooking, this money is counted as wages and needs to be documented and paid as such.

If the money is gifted to individuals with no return of services (i.e. those who were laid off or furloughed), this is seen as a true gift and is excluded from the regular rate of pay.

The annual gift tax exclusion is $15,000 for both the 2019 and 2020 tax year, which is the amount of money that an individual or company can give as a gift to one person, in any given year, without having to pay a gift tax.

Are income replacement payments excluded from qualified disaster relief payments, and if so, does this require a portion of funds to be withheld to pay as income tax?

President Trump determined that the COVID-19 pandemic warranted a nationwide emergency declaration under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, thereby giving employers the opportunity to provide tax-free assistance to their employees under Section 139 of the IRS Code. 

However, this does not apply to income replacement payments, which is outlined in the below paragraph from an article entitled “COVID-19: Section 139 Employer-Provided Tax-Free Disaster Relief Benefits” from national law firm Buchanan Ingersoll & Rooney: 

“Section 139 provides that qualified disaster relief payments from any source reimbursing or paying an individual for certain expenses in connection with a qualified disaster are not subject to income or employment taxes (Social Security, Medicare, and federal unemployment taxes). For this purpose, a qualified disaster relief payment includes any amount paid by an employer to or for the benefit of an employee to reimburse or pay “reasonable and necessary” personal, family, living, or funeral expenses incurred as a result of a qualified disaster. Qualified disaster relief payments, however, do not include: (i) payments for expenses that are otherwise paid for by insurance or other reimbursements; or (ii) income replacement payments, such as the payment of lost wages, lost business income, or unemployment compensation [source 12].”

We recommend talking to your CPA to understand how to best track and categorize any such payments to employees so you can understand how to most effectively allocate relief funds to your team.

Full Report

You can view Oyster Sunday’s full report here. Please also visit our website for a list of consolidated resources from around the U.S. as we continue to provide relevant and updated information regarding the COVID-19 crisis.

Oyster Sunday is committed to supporting independent restaurants with in-kind consultations to ensure they have another resource in their corner during these unimaginably trying times. From communicating with your team to thinking through cash flow constraints, please contact us. Beyond our leadership team, we are connected with a remarkable community of professionals — lawyers, PR professionals, accountants, CPAs, copywriters and more —who have generously offered to donate their time and resources to restaurants that need help navigating this crisis.

Information Sources

(1) RSM Accounting: Retailers must be mindful of gift card tax pitfalls [Here]

(2) New York Governor Cuomo Signs New Protections for Consumers Using Gift Cards Into Law [Here] 

(3) National Governance of State Legislatures | Gift Cards + Gift Certificates Statutes + Legislation [Here]

(4) HR Daily Advisor: Ask the Expert: Are All Gift Cards Taxable Income? [Here]

(5) Washington State University: PayRoll: Taxability of Gift Cards [Here]

(6) BDO Tax Accounting: Five Common Myths that Lead to Tax Reporting Errors [Here]

(7) Apartment Therapy: New York State Just Passed a Law Making Gift Cards Easier to Use [Here]

(8) GoFundMe: Taxes for Organizers [Here]

(9) GoFundMe: Small Business Relief Fund Grant FAQ [Here]

(10) Pittsburgh Post Gazette: GoFundMe helps those who need it, but don’t forget about the IRS [Here]

(11) Foundation Group: What benefit does being 501(c)(3) offer my nonprofit and its contributors? [Here]

(12) Buchanan, Ingersoll, Rooney: COVID-19: Section 139 Employer-Provided Tax-Free Disaster Relief Benefits [Here]

(13) Forbes: Little-Known Tax Law Allows Employers To Make Tax-Free Payments To Employees To Cover Covid-19 Expenses [Here]

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About: Oyster Sunday is a hospitality group based in New Orleans and New York City with the mission to reevaluate and reimagine the business infrastructure necessary to support stable, progressive restaurants and culinary businesses. To bring this idea to life, we establish strategic partnerships across the food and beverage industry, providing consolidated branding and operational support for independent food and beverage companies with a point of view. We believe that if we pool resources across many operators—regardless of location or chef—we’re able to build an economy of scale that gives us all a seat at the table. Please visit our website and follow us on Instagram.

Elizabeth Tilton is the founder and CEO of Oyster Sunday. Elizabeth started her career as a pastry cook in New Orleans, and in 2012 moved to NYC to join David Chang’s restaurant group, Momofuku. There she helped manage public relations, marketing, and major partnerships for the restaurant group. In 2015 she became the Head of Brand at W&P, a vertically-integrated design and manufacturing company developing culinary products, where she managed the launch of over 300 products including product partnerships with Lucas Films, Williams-Sonoma, West Elm, and Food52. She launched Oyster Sunday in late 2019.

The post Will My Restaurant Get Taxed on Gift Cards & GoFundMe Campaigns? appeared first on Food+Tech Connect.

Food+Tech Connect and The Future Market are hosting Biodiversity: The Intersection of Taste & Sustainability, an editorial series featuring interviews with over 45 leading food industry CEOs, executives, farmers, investors and researchers on the role of biodiversity in the food industry. Read all of the interviews here. 

Kathleen Merrigan, former deputy secretary and COO of the United States Department of Agriculture, helped write the original 1990 Organic Foods Production Act (OFPA), and now she says “the time is right to enhance the National Organic Program with biodiversity dictates.” She argues that rather than creating new standards and labels, which often just confuse consumers, there are already built-in mechanisms to push organic standards to better support things like biodiversity and soil health. She also urges that the only way to drive real food system change is to diversify leadership to better reflect societal demographics. In particular, Merrigan argues for increased investment in female founded companies and great representation of women on boards.

Below, I chat with Merrigan about true cost accounting, how we might evolve organic standards to support biodiversity, and how she’s supporting biodiversity through her new role as the director and professor of the Swette Center for Sustainable Food Systems at Arizona State, as a venture partner at Astanor Ventures and as an advisor and a board member and advisor to a number of organizations.

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Danielle Gould: What is Arizona State University doing or planning to do to promote biodiversity?

Kathleen A. Merrigan: To understand food production in its full context, we need to factor in, and cost-out, all impacts – biodiversity, human health, water quality, climate, wasted food, etc. In doing so, what are now largely invisible costs (because they are not valued monetarily), become explicit and the choices we make about what, how, and where we produce food will become transparent.

ASU is excited by, and supporting the work that I’m doing related to TEEB for Agriculture and Food, a UN Environment Programme Initiative with several supporters, including the Global Alliance for the Future of Food. Some of your readers may be familiar with TEEB, which stands for The Economics of Ecosystems and Biodiversity. The goal of TEEB is to “make nature’s values visible.” TEEB “AgriFood” grew out of the overall TEEB effort and for the past several years, we’ve engaged nearly 200 scholars across 33 countries in an effort to develop a framework approach that allows us to identify, and place a value on, externalities of food production, be they positive or negative. The simple idea is this: valuations of externalities enable us to understand the true cost of food. This will help our leaders, especially policymakers, make informed — and hopefully better — decisions.

Would such transparency really lead to more sustainable food systems? There is no guarantee of course, but consider the example of wasted food. People were shocked to learn the cost of wasted food, which FAO has estimated to be $1 trillion annually, and the result has been more policy proposals to address the problem. While insufficient reform has occurred to date, I am optimistic that the revelation of the issue through cost accounting will ultimately compel policymakers to act (e.g., not that long ago France prohibited grocery stores from throwing away edible food).

DG: Are there certifications or other signals that can help the average consumer determine what kinds of foods are helping promote biodiversity?

KM: The organic label is best in class when it comes to voluntary certification programs, and I believe the time is right to enhance the National Organic Program with biodiversity dictates. I can assure you that we had biodiversity on our minds when drafting the 1990 Organic Foods Production Act (OFPA) and its implementing regulations published in 2000, and yet you won’t find a specific section on ‘biodiversity dos and don’ts.’

There was anxiety then, and likely now, that it is difficult to measure and enforce biodiversity standards. But we’re smarter today than we were 30 years ago and we have a built-in mechanism to improve organic standards for biodiversity, soil health, and other aspects without new law. OFPA requires every producer and processor to establish an organic plan to be reviewed as part of certification. This requirement has not been utilized in the ways that I had imagined and yet it provides all kinds of opportunity to implement creative and updated thinking about production and handling standards consistent with OFPA and organic philosophy. Unfortunately, this seems to be lost on too many people and we are seeing various labels and certifications in the marketplace promoted as “better than” organic – which is almost always not true and confuses consumers looking to do the right thing.

While we will be prioritizing work on organic at the Swette Center, I should also point out that voluntary standards of any kind are no substitute for public policy – laws and incentives that support biodiversity. Consumers should pressure the marketplace for biodiversity information, but they should also be engaging in policy discussions that create biodiversity mandates, ensuring compliance across food production. A 2017 report on the 400+ voluntary sustainability standards illustrates this point with some good data.

DG: What investments need to be made to create a more biodiverse food system?

KM: The influx of new capital, particularly from venture capitalists who made their first fortune in Silicon Valley, has the potential to transform the food sector. Many of these firms engage in “impact investing” – meaning they only make investments that align with sustainable food systems. I am a venture partner in such a firm, Astanor Ventures, based in Europe as well as an advisor to S2G Ventures here in the US. Given the current intractability in government at the federal level, I’ve shifted some of my attention to innovations coming from the private sector, and I’m encouraged by the young entrepreneurs whom I’ve met.

Putting a twist on your question and related to the upsurge of venture capital, I want to pitch the power of people diversity. I’ve always said that it is foolish to think that we’ll change the food system without changing the decision makers around the table so to better reflect societal demographics. Part of the ‘biodiversity’ agenda needs to be about supporting women, who find it more difficult to raise capital for their companies and who are poorly represented in board rooms. I cling to the belief that things will evolve naturally, but maybe we need something like the European legal mandate that 50 percent of board seats be held by women or the new California law that requires all public boards to have at least one woman director by the close of 2019 and by 2021, at least three female directors if the board is six or more people; 2 if the board is five people; and at least one female if the board has four or fewer directors.

DG: What are some examples of food products that promote biodiversity?

KM: We need greater diversity in what we grow and eat for the many reasons your readers understand. My students will tell you that I’m pulse-crazy.  FAO has a pretty good website that describes pulses, along with their health and environmental benefits. It goes to my lifelong interest in figuring a way to make crop rotations profitable for farmers. Good, soil enhancing crop rotations are a cornerstone of sustainability and a practice mandated by the Organic Foods Production Act of 1990. But too often farmers lose money on crops that do right by the environment but for which consumers are not clamoring. Chef Dan Barber thinks quite a bit about this dilemma and is championing great cuisine. He has served me “rotational risotto” and “cover crop salad” – both celebrating crops that are not yet mainstream but certainly delicious.

Cover crop salad with oat bread, which she was served by Chef Dan Barber at Blue Hill at Stone Barns // Credit: Kathleen Merrigan

DG: If we get to a perfectly biodiverse food system, how would that change the typical selection of products we see in a grocery store?

KM: There is seeming abundance of choice as we travel up and down the aisles of our grocery stores. It is fairly common these days to confront up to 60,000 different items in a grocery, with some superstores having as many as 200,000! The Food Marketing Institute reports that the average number of Stock-Keeping Units (SKUs) in 2017 across all kinds of groceries was 30,098. Yet there is a falseness to this – the many brands, labels, and quantity suggest diversity, but when you get beyond the marketing jazz, much of what is presented to us is basically the same – same ingredients, same varieties, same companies. And changing this is tough. It is difficult to get a new item into a grocery unless you’re one of the big guys. I loved that Whole Foods Market had local food foragers who helped smaller scale farmers and food producers make it onto their shelves, but with all the changes that company has and is going through, those days may be over.

Years ago I used to bring my students to the University of Massachusetts Cold Spring Orchard Research and Education Center in Belchertown where they grew over 200 varieties of apples (today it’s more like 100). It was sheer joy to taste the diversity of the apples, and also learn from scientists why certain varieties fell out of favor, or were better than others in resisting pests. But what grocery is going to carry more than a handful of varieties? Even with growing interest in a tastier apple, I would love to see a grocery store with its core mission being a celebration of biodiversity. I’m going to have to dream on that awhile.

On April 30, 2019, join Kathleen Merrigan and Chef Dan Barber for an event on the Power of Deliciousness. The event will also be livestreamed by Food Tank.

Read all of our biodiversity interviews here and learn more about Biodiversity at The Future Market.

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Kathleen A. Merrigan is the Kelly and Brian Swette Professor of Sustainable Food Systems at the Arizona State University School of Sustainability and director of the Swette Center for Sustainable Food Systems. Previously, Merrigan served as Deputy Secretary and COO of the United States Department of Agriculture. She is currently a board member of FoodCorps, Stone Barns Center for Food and Agriculture, Center for Climate and Energy Solutions (C2ES) and World Agroforestry (ICRAF) and is affiliated with Astanor Ventures and S2G, two firms investing in ag-tech innovations.

The post Biodiversity Requirements Will Enhance Organic Standards, Says Kathleen Merrigan appeared first on Food+Tech Connect.

Food+Tech Connect and The Future Market are hosting Biodiversity: The Intersection of Taste & Sustainability, an editorial series featuring interviews with over 45 leading food industry CEOs, executives, farmers, investors and researchers on the role of biodiversity in the food industry. Read all of the interviews here. 

Can aquaponics and aquaculture support and protect biodiversity? We speak with Edenworks co-founder and CEO Jason Green about why seafood biodiversity is critical and the role aquaponics and aquaculture can play in preserving it. He also talks to us about how the company is creating biodiverse ecosystems, including microbial ecosystems, to grow seafood with no antibiotics, hormones, mercury, or waste discharge, and plants with no pesticides or added fertilizer.

Danielle Gould: Is biodiversity a priority for Edenworks? If so, how and why?

Jason Green: Biodiversity is at the core of what Edenworks does. We are an aquaponic vertical farm. We grow complete ecosystems that combine aquaculture (fish farming) with hydroponics (fertilizing plants with nutrient-rich water), inside controlled environments.

Our aquaponic ecosystems are multi-tiered food webs, just as you find in nature. We start by farming animals — fish and shrimp — both for food and for their waste. Next, we grow the microbiome — all the bacteria and fungi that live with our fish, break down their waste into fertilizer that our plants can use, and colonize plant roots to improve the health of our plants. Finally, we grow plants, which absorb all those nutrients.

By growing biodiverse ecosystems, we generate seafood with no antibiotics, hormones, mercury, or waste discharge, and plants with no pesticides or added fertilizer. It’s a beautiful marriage.

DG: How does Edenworks define and think about biodiversity? What does an ideal biodiverse food system look like? How do you measure biodiversity?

JG: Ideal, biodiverse food systems source from working, biodiverse ecosystems. What ends up on your plate — the items and ratios — should be representative of what nature can sustain.

We measure biodiversity in terms of “food webs” within our ecosystems, ie. what’s eating what. In the language of ecology, we’re looking to increase both “species richness,” the breadth of different species (x-axis), and “trophic diversity,” the number of tiers within a food web.

Beyond the visible levels of biodiversity, there is an invisible aspect to biodiversity: the microbiome. The microbiome is the community of bacteria and fungi that live in and around all of our plants and animals (and us humans).

Our oceans and soils have an almost unbelievable level of microbial diversity. A gram of healthy soil has between 100 million and one billion microbial cells. Unhealthy soil might have around 10 thousand bacterial cells, a difference of 100,000x!

It’s also now been studied that monocultures, pesticides, and industrial fertilizers reduce microbiome diversity, which creates a dependence on those chemicals. Increasing the levels of visible biodiversity exponentially increases the levels of microbiome diversity and removes the need for chemicals. So there’s a virtuous cycle at play here.

DG: What role might aquaculture play in promoting biodiversity?

JG: Seafood has been referred to as the last wild food. It is the last protein market to have meaningful levels of biodiversity. In contrast, beef, poultry, and pork have very low levels of biodiversity. So there’s real concern that if aquaculture goes the way of other protein markets, we’ll lose all that biodiversity.

Aquaculture also has unparalleled opportunity for impact. It’s the largest and fastest growing protein market in the world. In fact, it’s the fastest growing food segment overall.

What’s exciting is that biodiversity is already getting traction as a treatment for the biggest issue threatening future growth in aquaculture: pest pressure. Salmon monoculture operations globally have been under a years-long assault by sea lice. In shrimp farming, the lack of genetic diversity globally is such an issue that every few years, a huge portion of global shrimp stocks get wiped out by a single virus. Industry finds a new species that is resistant to that virus, those genetics come to dominate the global market…rinse, repeat.

Integrated multi-trophic aquaculture (IMTA; it’s a mouthful) is the industry term for growing whole multi-tiered aquatic ecosystems. For example, instead of just growing salmon, also growing seaweed to absorb excess nitrogen, and bivalves to absorb organic nutrients. These biodiverse ecosystems are more disease resistant and more profitable than traditional monocultures, creating an economic incentive for biodiversity.

Fun fact: in IMTA, the biodiversity doesn’t stop at the species being farmed. All manners of wild sea creatures will begin to colonize these ecosystems, especially the “kelp forests”. Once you start farming for biodiversity, nature helps to snowball.

DG: What is Edenworks doing or planning to do to promote biodiversity?

JG: Edenworks is the most biodiverse indoor farm. We’ve yet to find another indoor farm that’s growing as much diversity in terms of both produce and protein. To date, we’ve grown four species of fish and more than 80 varieties of leafy greens.

In terms of what’s next for us, there are new, amazing technologies that are also allowing us to measure the diversity and contents of our microbiome.

DG: What is the business case for biodiverse aquaculture?

JG: The business case for biodiverse aquaculture is that it improves quality and profitability. I mentioned the traction that biodiverse aquaculture is gaining in improving disease resistance and profitability in offshore aquaculture. What Edenworks is doing with aquaponics is a parallel approach for growing on land instead of in the ocean.

On the plant side, a square foot of bedspace for Edenworks yields 230 percent of the average for vertical farming of leafy greens. And we deliver those yields using 90 percent less nitrogen fertilizer (derived fully from our aquaculture waste) than vertical farms that use synthetic fertilizer. Without using pesticides or sanitizers, we’ve eliminated foodborne pathogens, including E. coli, and reduced crop disease incidence from one in four harvests to one in one hundred harvests.

Using conventional (synthetic) practices, a 200 percent increase in yields requires a 500 percent increase in fertilizer. Doing some math, we’re showing that biodiversity is about 50x more powerful as a driver of yields.

On the fish side, we’ve improved the feed conversion ratio (ratio of feed in to meat out) by about one third for our bass, and early data from salmon is promising. Feed is the single largest cost and sustainability challenge in aquaculture. We’re showing that through a biodiverse approach, we can improve the dominant cost item, making higher quality, more sustainable product a cost competitive option.

DG: What investments need to be made to create a more biodiverse food system?

JG: Hopefully we’ve established that aquaculture can increase the biodiversity of our food system. The biggest hurdle to growth of the US aquaculture industry is regulation. In 1983, the US Joint Subcommittee on Aquaculture commissioned a study on why the US was lagging international growth in aquaculture. It found 11 federal agencies directly involved in regulating aquaculture, another 10 indirectly involved, and more than 1,200 state laws.

Instead of encouraging sustainable, biodiversity-enhancing aquaculture development, the US regulatory environment is all but impenetrable. Little has changed in the 35+ years since that study.

Edenworks sidesteps the regulatory nightmare by growing indoors — which recirculating aquaculture technology only recently made possible. But there are so many opportunities for aquaculture to enhance the biodiversity of our protein market, our watersheds, and our oceans. Improving the regulatory environment to encourage sustainable aquaculture development should be a national food security imperative.

DG: What are the greatest challenges and opportunities Edenworks faces for creating a more biodiverse system? What are you doing to overcome or capture them?

JG: Today, we’ve achieved the metrics that validate our thesis that biodiversity improves quality and profitability — higher yields, safer and more stable production through pathogen resistance, improved fertilizer & feed conversion.

The biggest challenge in getting to this point of validation was fear from most in the capital market that our biodiverse approach added complexity without benefit. We were fortunate to align ourselves with investors who shared our thesis from first principles and who were willing to ride with us so that we could collect the metrics.

DG: Are there certain products you would like to see more of in the food industry that would help promote a more biodiverse agricultural system?

JG: More domestically farmed seafood! It’s especially important that chefs help break negative stigma about farmed seafood and educate diners about high quality, sustainably farmed seafood. Dan Barber has a great TED talk about biodiverse aquaculture: “How I fell in love with a fish.”

DG: What is your vision for what a more biodiverse food system looks like in 10-15 years?

JG: I’ll explain my vision by analogy. One of our investors runs an amazing grassfed beef business. A few years ago, they realized they weren’t growing beef, they were growing grass and the grass was growing the beef. So they started focusing on the grass. Then they realized that they weren’t growing the grass, the microbes in the soil were. So they started focusing on the microbes. Perhaps counterintuitive, but they realized that in order to maximize the quality and the profitability of their beef, they had to build their ecosystem from the ground up (literally).

My vision for our near future food system is that holistic or whole ecosystem farming approaches become table stakes. I’d like to not be surprised by the cattle farmer who talks to me about worms and protozoa, or the salmon farmer who’s excited about mussels and kelp.

DG: Anything else you want to share?

JG: For further reading on aquaculture, including why the US has an unfair advantage in becoming the next aquaculture powerhouse, we have a great blog post.

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Jason Green, CEO & Co-founder of Edenworks

Jason Green is CEO + Co-founder at Edenworks, a Brooklyn-based aquaponic vertical farm. Founded in 2013, Edenworks’ mission is to become the world’s largest fresh food supplier by replacing globalized supply chains with local product that is sustainable, organic, and low cost. Edenworks grows a variety of leafy greens that are fertilized by the seafood the company grows, including shrimp, salmon, and striped bass.

Prior to Edenworks, Jason developed virtual and augmented reality-based neurorehabilitation technologies and served as a Howard Hughes Medical Institute Research Fellow. Jason was honored by Forbes Magazine’s 30 Under 30: Social Entrepreneurship in 2017 and the Global Aquaculture Alliance’s 30 Under 30 in 2018.

The post Edenworks on How Aquaponics & Aquaculture Can Promote Biodiversity appeared first on Food+Tech Connect.

Food+Tech Connect and The Future Market are hosting Biodiversity: The Intersection of Taste & Sustainability, an editorial series featuring interviews with over 45 leading food industry CEOs, executives, farmers, investors and researchers on the role of biodiversity in the food industry. Read all of the interviews here. 

Throughout this series, we’ve spoken a lot about diversifying what we’re eating, but diversity in our soil is equally important. Soil biodiversity, the variability of living organisms in our soil that interact with one another and with plants and animals in the ecosystem, is critical to the health and functioning of all ecosystems. Healthy soil provides a myriad of essential ecosystems services, like carbon sequestration, storing and processing water and enhancing plant health.

Below, I speak with Tina Owens, senior director of agriculture for Danone North America, about how and why the company is supporting soil health through its multi-million dollar research program dedicated to helping farmers enhance the organic matter in their soil and its overall fertility. She also shares insight into how the company measures its impact on soil health, as well as how it invests in farmers to help them covert to soil practices that promote biodiversity.

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Danielle Gould: Is biodiversity a priority for Danone North America? If so, how and why?

Tina Owens: Yes, biodiversity is a major priority for Danone North America because it is a major driver of the health of our planet. Our global vision of One Planet. One Health is guided by the belief that the planet that feeds us and the lives of everyone on it are deeply interconnected. As a public benefit corporation and the largest Certified B Corporation® in the world, we are committed to both business and social progress, and we embed responsible animal welfare, sustainable agriculture and innovative regenerative farming practices into how we do business.

DG: How does Danone North America define and think about biodiversity?

TO: Because we know the health of people and the health of planet are inseparable, we think about and prioritize biodiversity through the very foundation of our food system: the health of our planet’s soil. Soil is key to all survival on planet earth – 95 percent of food directly or indirectly relies on it. We offer a diverse range of dairy and plant-based products, and all of them rely on and have the ability to contribute to healthy soil.

DG: What is Danone North Americadoing or planning to do to promote biodiversity?

TO: As America’s largest yogurt maker, we saw an opportunity to initiate a breakthrough soil health research program through our own supply chain and relationships with farmers. In March 2018, we launched a multi-year, multi-million-dollar soil health research program to help farmers reach for better soil health and improve their own livelihoods. We also announced our ambition to commit up to $6M for the research program over the next five years.

Through our soil health research program, Danone North America aims to identify ways to help regenerate soils – including enhancing organic matter and soil fertility with long-term benefits like soil carbon sequestration, reduced chemicals use, water holding capacity, biodiversity and economic resilience of farmer communities. In partnership with growers, dairy farmer partners and third-party soil health experts, our program includes soil sampling, review of crop yield, conversations with growers about their individual needs, data collection and analysis, first reports and field days with farmers to provide training around soil health best practices.

But we can’t do it alone, so Danone North America joined The Carbon Underground, Green America and other food companies to inform the design and development of a new global certification standard for food grown in a regenerative way.

Finally, the company is exploring options to participate in the Regenerative Organic Alliance, a group working to develop a new standard, which will be known as Regenerative Organic Certification. The work with the Regenerative Organic Alliance would complement our commitment to the USDA Organic Standard through pioneering brands, like Horizon Organic, which was instrumental in working with the USDA to establish organic standards and the USDA Organic seal. We seek to understand how this proposed certification can benefit our planet and farming communities through soil health, animal welfare, social fairness and offer more choices for our consumers and our business.

DG: What investments need to be made to create a more biodiverse food system?

TO: With all life beginning in soil, using agricultural practices that can help regenerate soils is an urgent need. We believe all food companies have a responsibility to protect the health and vitality of soil we rely on for business. Danone North America believes that making changes like embracing innovative farming practices is critically important for the future of agriculture, and the private sector has an essential role to play in making sure these changes happen on a significant scale.

Beginning in 2017, we began working with EcoPractices, a third-party partner that gives us the technology we need to assess risks and sustainability performance in our supply chain, to better understand the practices behind how crops are grown on several farms that feed into our dairies. This partnership allowed us to determine whether the farms were increasing biodiversity through the planting of cover crops and crop rotations, and we began monitoring pesticides, fertilizers and herbicide application. In addition to our animal feed crops like non-GMO corn, soy and canola, these farms grew twelve cover crops including varieties of oats, triticale, winter wheat, rye, peas and radishes. Because cover crops help our farmers with productivity, while also reducing environmental impact, we continue to advance our strategy of funding cover crops and crop rotations throughout our supply chain.

Our North American agriculture team is heavily focused on opening avenues of new investment via grants, private partnerships and impact investing that will help more of our farmers convert to soil practices that promote a more biodiverse system. But we do not expect the individual farms to bear the brunt of work required to change current agricultural practices, so we use our position within the industry to open doors across the food system – through policy advocacy, access to funding or training or raising awareness – to drive positive change throughout our agricultural community.

DG: What are the greatest challenges and opportunities your organization faces for creating a more biodiverse system? What are you doing to overcome or capture them?

TO: As America’s largest yogurt maker and top plant-based producer, we have an opportunity to promote the vitality of soil on a large scale with the help of our grower and farmer partners. That’s why we’ve committed more than $6 million over five years to our soil health research program and engaged a host of growers, farmers, NGOs and experts to support a healthy planet.

DG: How are you or how do you plan to handle the sourcing and scaling of biodiverse ingredients or agriculture?

TO: As the top organic food maker in the U.S., with pioneering organic brands, we work to find opportunities to apply our knowledge of sustainable practices across all of our businesses and diverse supply chains, from organic to Non-GMO Project Verified to conventional. Whether it is driving more sustainable ingredient sourcing or advancing packaging recyclability, we bring all of our businesses along on the path to a better world through food. We’ve put responsible, sustainable sourcing practices into place throughout our supply chain and made them an integral part of our strategy. Some examples of this work in action include: rolling out a compliance program to 100 percent of our suppliers to help us track where they are located so we can be conscious about working with local suppliers where possible and working to drive change in packaging by committing to pursue the goals outlined in Danone’s 2018 Packaging Policy.

Participating in pilot programs or working groups like Regenerative Organic Certification or the Carbon Farming Innovation Network allows us to serve as a leader within our communities when it comes to incorporating innovative ways of working and adopting new standards and certifications. We’re participating in industry leading programs, engaging at the nucleus of these groups to embed new ways of working and thinking into our long-term strategies.

An example of scaling a biodiverse agricultural product would be under our Horizon Organic brand, the first national organic milk brand in the United States, and a brand that worked with the USDA to establish organic standards and the USDA Organic seal. Our Horizon Organic Grassfed milk, which is from cows that are pasture-raised and graze on certified organic fresh pasture, launched in 2018 and represents our commitment to raising the bar on the organic experience for both the consumer and the dairy cow.

DG: What is your vision for what a more biodiverse food system looks like in 10-15 years?

TO: We believe a more biodiverse food system requires a reinvention of our relationship with food. In fact, we’d go so far as to call it a food revolution — one for greater well-being for people and the planet — which we are eager and ready to boldly lead, together with consumers, retailers, farmers, suppliers and not-for-profits, to design, produce, market and consume food in new, healthier and more sustainable ways.

We all have a stake in food, both for the fundamental nutritional needs it serves and the enjoyment it brings us. The profound role that food plays in unlocking the health of people and the planet is a central premise behind our parent company Danone’s signature — One Planet. One Health — which invites others to use their everyday decisions to join us in building a healthier world through food.

We are using our size as a large food company as a force for good and hope others join so we can leave this planet for future generations in a state of health better than that which we inherited.

Read all of our biodiversity interviews here and learn more about Biodiversity at The Future Market.

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Tina Owens, Senior Director of Agriculture at Danone North America

Tina Owens is the Senior Director of Agriculture for Danone North America, the largest public benefit corporation and the largest Certified B Corporation in the world. Tina leads the charge for regenerative agriculture practices, farmer profitability, unique animal feed supply chain development and regenerative financing. She also oversees Danone’s public commitment to soil health in North America, working with partners such as Cornell University and EcoPractices.

Prior to joining Danone in 2018 Tina led sustainability and strategic sourcing at Kashi Company, including the brands Bear Naked, Stretch Island Fruit Company, and Pure Organics. At Kashi she led the strategy on eight commodities to convert farmers to organic practices via the company’s collaborative effort with QAI on the Certified Transitional protocol. Under Tina’s leadership this program returned over $2 million in increased profitability from 2016 to 2018 across a cohort of 14 farms. Tina instituted responsible sourcing programs related to honeybee health, cocoa, wheat and oats. In 2011 Tina achieved the first round of Non-GMO Project Verified products for Kashi and continued to support the Non-GMO Project Renovation work for the full Kashi portfolio.

Tina and her family live on 12 acres in Michigan where they are transitioning previously farmed land to grow a variety of food using an agroforestry and regenerative approach.

The post How Danone North America Aims to Improve Soil Health appeared first on Food+Tech Connect.

Food+Tech Connect and The Future Market are hosting Biodiversity: The Intersection of Taste & Sustainability, an editorial series featuring interviews with over 45 leading food industry CEOs, executives, farmers, investors and researchers on the role of biodiversity in the food industry. Read all of the interviews here. 

The National Young Farmers Coalition is an organization dedicated to helping young farmers succeed. Below, I speak with executive director Lindsey Lusher Shute about why biodiversity is critical to the future success of agriculture in the United States, what policies and investments are needed to help farmers cultivate more biodiverse farming operations and what eaters can do to support a more biodiverse food system.

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Danielle Gould: Is biodiversity a priority for National Young Farmer Coalition? If so, how and why?

Lindsey Lusher Shute: Biodiversity is an important component of our mission as we support the policies and practices that enable a more sustainable, successful future for U.S. agriculture. According to our latest farmer survey, practices that support biodiversity are also a priority for young farmers: 75 percent of our farmers practice sustainable methods, 63 percent follow organic standards and 81 percent of our farmers run diversified operations.

DG: How does the National Young Farmers Coalition define and think about biodiversity? What does an ideal biodiverse food system look like?

LLS: On a farm, biodiversity means not only the plants, invertebrates, mammals, birds, amphibians, reptiles and fish that already live there — but also what we as farmers introduce to the landscape.

I can’t imagine an upper limit for biodiversity, and particularly in this moment when we are seeing the collapse of biodiversity on a global scale. It’s frankly hard to even describe what “good” might mean when it comes to biodiversity because there are still so many discoveries being made. We are a long way off from knowing even the extent of life on this planet and the interwoven nature of it all.

DG: As a farmer, how do you think about biodiversity?

LLS: On our farm, we’ve collaborated with the Hawthorne Valley Farmscape Ecology Program to look at insect biodiversity on our farm and how beneficial insects interact with pests. Over the course of the research on our property, they found three kinds of butterflies that we didn’t even know about: the Fiery Skipper, the Common Buckeye and the Hackberry Emperor. With wild pollinators responsible for pollinating half of all food crops, knowledge of these native species and the habitats that support them is incredibly valuable.

Biodiversity is meaningful to Ben and I because we want our farm to support life in all of its forms, and also because we know that biodiversity is critical to the farm’s success.

DG: What is National Young Farmer Coalition doing or planning to do to promote biodiversity?

LLS: Biodiversity cannot be achieved on one farm alone; policy and practices across the globe impact the health of our land and the biodiversity of our individual farms. We have spoken out on behalf of our farmers on many issues that impact biodiversity: land use changes, climate change, seed biodiversity, pesticides and herbicides, sustainable farm practices that are intended to work in tandem with the natural environment.

We advocate with our farmers, bringing producers from across the country to Washington, DC to ask Congress to support conservation policies that support and encourage biodiversity on the farm. Lastly, we also work to empower young farmers who are passionate environmentalists and farm in a way that supports biological diversity.

DG: What is the business case for biodiverse agriculture?

LLS: There is no farmer, no matter the scale or practice, who doesn’t recognize the importance of biodiversity. Farmers continuously rely on the bounty of nature and ingenuity of science to help them grow healthy crops.

That said, I would like to see more farmers embrace seed and breed biodiversity because what farmers choose to buy and grow on their farms today has an real impact on future farm biodiversity. When we no longer use a seed variety or only raise a certain kind of livestock — promoting, say, certain traits for economic efficiency alone — our community intentionally narrows the genetic diversity in agriculture.

And really that’s the crux of it: in a world with climate change, we need choices and regionally adapted varieties of seed and breeds. With choice, and with diversity, we reduce risk and build needed resilience.

DG: What investments need to be made to create a more biodiverse food system?

LLS: Farmers need to be supported as they implement conservation practices that increase biodiversity. A farm conservation plan, as currently required by USDA, should incorporate more measures of biodiversity and considerations for increasing it on each farm. We need ongoing research into organics, seed varieties, breeding and the like to continue to expand what farmers can grow, as well as more research into farm practices that are both efficient and ecological.

And lastly, we must address climate and land use. The nation must invest in a new economy that will drastically reduce our carbon footprint and halt global warming, and we need to protect our natural landscapes and habitats from fragmentation and development. All of these things — smart planning, research, science and conservation —represent major investments.

DG: What are the greatest challenges and opportunities farmers face for creating a more biodiverse system? What are you doing to overcome or capture them?

LLS: This might not be an obvious answer, but one of the most difficult issues for our farmers is land ownership. Without land ownership very few of our farmers can make investments into farm infrastructure and conservation that could adequately address the global crisis of biodiversity. Who owns and manages our landscapes is a critical question.

We also hear from many farmers about their need for extension and technical support services for organics and sustainable agriculture. This is a major need.

And lastly, we need to take a hard look at pesticides and herbicides and how they are impacting biodiversity. The recent issues around dicamba are a stark reminder of the negative impacts that farmers can have on the environment, and an impact that can extend well beyond the farm.

DG: How might we get more farmers to invest in biodiverse agriculture?

LLS: First and foremost, farmers need to own land. After that, they need low-interest loans or grants to support the cost and a consumer who is willing to pay a little more for food grown with practices that support a healthy ecosystem.

Research that makes the economic case for biodiversity may also encourage these practices. If you can demonstrate that improved diversity ultimately boosts productivity and sales potential, many more farmers may make the transition. As we’re already seeing, the increased consumer demand for sustainably grown products, even at higher price points, is also enabling farmers to invest in these practices.

Lastly, ensure that farmers, including beginning farmers and farmers of color, have access to key conservation programs so incentives are distributed equitably to farmer to promote biodiversity on their farms and ranches.

DG: What are some of the most important things food manufacturers, retailers, chefs and other key actors across the food supply chain can do to support biodiverse agriculture?

LLS: Buy local. Make the effort and deal with the small quantities that may be available now — because your purchases will help a farm and a farm community grow. I’ve also been impressed with Dan Barber and other chefs who are actively seeking to expand the varieties available to them, and who are working directly with farmers on breeding.

DG: Are there certain products you would like to see more of in the food industry — either in foodservice or CPG — that would help promote a more biodiverse agricultural system?

LLS: Again, I just want to have the opportunity to buy more products that were made by family-scale farmers with good practices. I also think that the entire idea of “foodservice” does not lend itself to biodiversity. When an institution is seeking perfect uniformity of weight or size or fat content, they are naturally limiting diversity of what’s grown. To address biodiversity, the entire industry would require a significant shift in priorities and different expectations for preparation and price.

DG: What is your vision for what a more biodiverse food system looks like in 10-15 years?

LLS: I’ll just say that 10-15 years is lightning fast when it comes to farming and agriculture. We have moved so far from animal and crop production that truly reflects a diverse food system, that I know it will take decades to build something that’s truly different on the ground. That said, I do think that we’re on our way in many respects and I am so hopeful about the young people I see farming today who care deeply about these issues. As these farmers take more leadership in the food system, we see positive shifts.

A more biodiverse food system must be fundamentally based on a system that defaults to locally grown products and is prepared for differences and diversity in ingredients. It is a system where consumers put even greater value on food that is grown with community in mind, with biodiversity in mind and is willing to be a little bit slower overall.

The idea of “slow” and “patient” is a fundamental value in a biodiverse system. We must take the time to listen and observe the environment around us, and work with it as we grow food; consumers must take the time to buy local products and support biodiversity and sustainable practices with their food budgets; and communities must take the time to listen to each other and advance innovative solutions to land use, climate and the pressing environmental issues of our day.

Read all of the interviews here and learn more about Biodiversity at The Future Market.

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Lindsey Lusher Shute, Executive Director and Co-founder of the National Young Farmers Coalition

Under Lindsey’s leadership, Young Farmers grew from a few volunteer farmers to a nationwide network with 42 chapters in 28 states and a base of over 150,000. Lindsey has edited and authored nine reports for the coalition, including Building a Future with Farmers: Challenges faced by Young, American Farmers and a Strategy to Help Them Succeed. This report established Young Farmer’s first policy platform and was the first to survey the nation’s millennial farmers. Farmland Conservation 2.0: How Land Trusts Can Save America’s Working Farms and a New York Times op-ed, “Keep Farmland for Farmers”, launched a national land access campaign that engaged hundreds of land trust professionals in making farmland affordable for future generations of farmers.

The coalition has become a force for leadership development and grassroots campaigns. It has passed 4 state laws and recently won hundreds of millions of dollars for small and sustainable farms in the 2018 Farm Bill. The national network of chapter leaders is now a pathway to leadership for young farmers, helping them raise their voices at the local, state and national levels.

Lindsey regularly speaks at conferences and to national media on farm issues, and was recognized as a “Champion of Change” by President Barack Obama. She was named among “20 Food Leaders Under 40” by Food Tank, and an “American Food Hero” by Eating Well Magazine. Lindsey holds a M.S. in Environmental Policy from Bard College and a BFA from New York University.

Lindsey and her husband, Benjamin, own and operate a 900-member CSA farm in Columbia County, New York.

The post The Future of Farming Must Be Biodiverse, Says National Young Farmers Coalition appeared first on Food+Tech Connect.

Food+Tech Connect and The Future Market are hosting Biodiversity: The Intersection of Taste & Sustainability, an editorial series featuring interviews with over 45 leading food industry CEOs, executives, farmers, investors and researchers on the role of biodiversity in the food industry. Read all of the interviews here. 

Wholesome Wave enables underserved eaters to make healthier food choices by increasing affordable access to locally and regionally grown fruits and vegetables. Now, the team behind Wholesome Wave is launching Wholesome Crave, a for-profit, socially responsible soup company created to directly benefit Wholesome Wave.

Below, I speak with founder and James Beard Award winning chef Michel Nischan about how he and Wholesome Crave think about biodiversity. As Millennials and Gen-Z look for more global and flavor-driven food experiences, he argues, we need supply chains and foods that better meet their needs, which also happens to support biodiversity.

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Danielle Gould: Why is biodiversity a priority for Wholesome Wave and Wholesome Crave?

Michel Nischan: Wholesome Wave focuses solely on making produce available to food insecure families. Wholesome Crave will be prioritizing biodiversity in the food supply chain once we’re up and running. We will continue working to expand market demand for an array of biodiverse ingredients to be able to offer exciting and stimulating flavor profiles, cultural appeal and to differentiate Crave from existing offerings.

DG: How does Wholesome Wave and Wholesome Crave define and think about biodiversity?

MN: Crave looks at biodiversity as an essential component in creating a new reality in a supply chain currently very limited in any meaningful diversity. We know that by pleasing our eaters and offering them greater diversity, the resulting demand at scale could have positive environmental and human health impacts.

DG: What is the business case for products that promote a more biodiverse food system?

MN: Biodiversity equals flavor excitement. With Millennials and Gen-Z highly interested in and spending money on a wide variety of ethnic cuisines, the supply chain needs to step-up in ways that can address this expansive market demand. Planting biodiverse crops, and marketing them appropriately/accordingly, would provide quite a competitive advantage, considering how so much of the current supply chain is held by “old-school – big-food” companies.

DG: What investments need to be made to create a more biodiverse food system?

MN: Agricultural land leases need to go well beyond the current norm of year-to-year. Harvesting equipment for multiple varietals of legumes, grains and specialty crops. Ag technology to respond to changes in climate linking to varietals that grow well in draught, heavier rain patterns, etc.

DG: What are the greatest challenges and opportunities your organizations faces for creating a more biodiverse system, and what are you doing to overcome or capture them?

MN: The current food supply chain is set up more for efficiency than diversity. Market demand will be the answer here, as well as logistics tech that can introduce producers directly to the end user. There is plenty of supply chain infrastructure to support wheat, but Teff cannot be run through the same infrastructure, other than the transportation element.

DG: Does your average consumer care about biodiversity today? No, but that is changing. Why should they care?

MN: With the rapidly growing number of eaters (who are already craving diverse flavor) expressing their values regarding the environment, labor practices, sustainability and so on, biodiversity is a consistent solution. How do you (or will you) get them to care? By delivering exceptional flavor coupled with using digital communication to demonstrate the end benefit to under-served communities, directly to the eater.

DG: What are some of the most important things food manufacturers can do to support biodiversity? Retailers? Other key parts of the food supply chain?

MN: Vary the ingredients they use in their products. Onions, carrots and celery can be found in 70 percent of a full portfolio of a soup company’s product list.

DG: Are there certain products you would like to see more of in the food industry that would help promote a more biodiverse agricultural system?

MN: Asian, site-specific Central American, fermented, ancient grains and legumes.

Read all of our biodiversity interviews here and learn more about Biodiversity at The Future Market.

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Credit:Tom Hopkins

Michel Nischan, Chef, Author and Food Equity Advocate Founder & CEO, Wholesome Wave & Wholesome Crave

Michel Nischan is a four-time James Beard Award winning chef with over 30 years of leadership advocating for a more healthful, sustainable food system. He is Founder and CEO of Wholesome Wave, Co-Founder of the James Beard Foundation’s Chefs Action Network, as well as Founder and Partner with the late actor Paul Newman of the former Dressing Room Restaurant. Nischan, whose parents were farmers, began his career at 19, cooking breakfast at a truck stop. He quickly realized that the ingredients coming in the back door fell far short of the farm-fresh harvests he’d grown up on, and began a life-long career championing the farm-to-table concept, decades before it had a name.

Nischan was instrumental in securing $100M for Food Insecurity Nutrition Incentive (FINI) grants for the food equity field in the 2014 Federal Farm Bill, expanding affordable access to locally grown fruits and vegetables. He’s also the author of three cookbooks on sustainable food systems and social equity through food. A lifetime Ashoka fellow, he serves as a director on the board of the Jacques Pepin Foundation and on the advisory boards of Chef’s Collaborative, Modern Farmer, Good Food Media Network and The National Young Farmers Coalition. The James Beard Foundation honored Nischan as the 2015 Humanitarian of The Year. To learn more about Chef Nischan, follow him on Facebook, Twitter and Instagram and visit www.chefnischan.com To learn more about Wholesome Wave visit, follow us on Twitter and Instagram or visit www.wholesomewave.org

The post Millennial & Gen-Z Eating Behaviors Will Shift Supply Chains, Says Michel Nischan appeared first on Food+Tech Connect.