The huddles this week focused on food hub hurdles, pivots and successes; transformative supply chain technologies; and sustainable packaging innovation. Watch the recording here.
Talking Points
- Food hubs built around farm-to-school programs
- With uncertainty around kids coming back to school, many hubs struggling; somecould be out of business in 6 to 8 weeks if things don’t change
- Farm-to-school already a difficult business model, now extremely tough
- Hubs that have pivoted to nonprofit, food security work, CSAs, direct-to- consumer, etc., have better runway out of COVID
- More philanthropy dollars supporting hubs’ nonprofit endeavors
- Exposure of issues food assistance industrial complex also helps upstart programs gain awareness and funding
- 87% of COVID-positive Tyson and JBS workers are minorities
- Product line rationalization hitting food service too
- Taco Bell cutting SKUs; KFC cutting SKUs, launching veggie chicken nugget; both cite supply chain issues
- Commodity surpluses
- Nuts
- Keto and paleo crazes drove up demand, so more trees planted
- Now too many almonds and walnuts, driving prices down
- Excess peanuts because no fans at Major League Baseball
- Low nut prices great for food brands, bad for growers
- Coffee
- Climate change threatening growing regions
- COVID caused office shutdowns, so less coffee consumed
- Price declining significantly
Trends
- Nuts
- Technology transforming supply chain
- Innovation already impacting food manufacturing, distribution, etc., but COVID accelerating adoption
- Big expense upfront but pays off long-term with max efficiency and less labor
- Applicable for businesses at any scale
- Deloitte’s Technologies for Supply Chain Innovation
- 3D scanning
- Big food companies using for design and development
- Improves cellphone scanning accuracy
- Virtual reality
- Software helps visualize how product looks on shelf, with a library of competing products
- May transform meetings with retail buyers
- Smart glasses
- Enable hands-free work
- Wearable interface with computer
- Manipulate glasses to retrieve data
- Warehouses experimenting with them
- Smart sensors
- Microprocessors, diagnostics, storage connectivity
- Cost dropping as tech improves
- Real-time inventory tracking and total traceability
- Autonomous robots
- More accurate and efficient than humans
- Already used widely for big industrial food distribution and warehousing
- COVID prompting more food facilities to intersperse robots with humans for safety
- Smart software
- Becoming more and more necessary for traceability, food safety compliance, etc.
- Check out Quigistics ERP system, affordable for small brands
- One area where tech can make big impact for small companies
- Renewable energy
- Big global food companies (Nestlé, Danone) not U.S. based; home markets in Europe and elsewhere stricter on sustainability, with consumers pushing companies harder to be greener
- 3D scanning
- Innovation in sustainable packaging
- McKinsey report
- Danone (French) has prioritized sustainability for years, focusing on packaging and circular economy; goal to have 100% of packaging reusable, recyclable or compostable by 2025
- Circular Economy Accelerator aiming to develop private-public partnerships to encourage sustainable packaging and municipal composting, especially in the U.S.
- Consumers wary of plastic packaging, despite COVID-caused uptick; food companies should take heed
- COVID comorbidities and nutrition connected
- Comorbidities higher among minorities, on a continuum with food access, nutrition, diet, etc.
Tips & Next Steps
- Comorbidities higher among minorities, on a continuum with food access, nutrition, diet, etc.
- Pivot success: ShiftMeals in Vermont
- Quasi-farm-to-institution model leveraging restaurants to feed essential workers
- Partnered with nonprofit, growing rapidly, more funds coming in
- Specialty Food Association – Working with Buyers webinar series | Free! | More Information
- Pricing for Profit Workshop covers w-commerce, wholesale, Amazon, etc.