COVID-19 has disrupted the food industry in countless ways, with nearly every CPG brand, retailer, restaurant, distributor, broker, supplier and farmer feeling the impact. Some businesses have been hit harder than others; some have responded to the unprecedented challenges better than others. While many food-related businesses haven’t been able to survive the sudden turmoil (understandably), plenty have paved new runways out of trouble and managed to keep their companies afloat.
The food businesses still kicking today share a few common traits: flexibility, creativity, resourcefulness, resiliency and, maybe most important of all, willingness to toss aside the old playbook and pivot in a new direction.
Rethinking an entire business strategy is never easy. But figuring out how to change courses abruptly and then execute swiftly, as the pandemic has forced so many food companies to do, is a whole other beast. It’s daunting, frustrating and particularly painful when the old plan worked wonderfully. But when a business’s primary sales channel is choked or its best customers go belly up or its access to consumers is suddenly severed? Time to suck it up and pivot.
Brix Cider, a farm-to-table eatery and taproom in Mount Horeb, Wisconsin, found itself in this position in March, as COVID-19 started ripping through the U.S. Business was stellar, and Marie and Matt Raboin didn’t want to mess with the formula they’d worked so hard to nail. But for the cidery to survive—and to avoid abandoning dozens of farmer partners—they had to innovate and act fast.
In a matter of days, Brix Cider reinvented itself as a food hub, launching an e-commerce site where customers can order farm-fresh groceries for pickup or delivery. This summer, the company pivoted again, reopening the patio for dining and turning the taproom into a marketplace for onsite grocery shopping. Check out the latest Edible-Alpha® podcast to hear the story straight from Marie.
Brix Cider isn’t the only restaurant to pivot to food hub or small grocery store with optional delivery, although its curated list of superior-quality, straight-from-the-farm offerings is certainly unique. Restaurants and other foodservice operators nationwide have made similar moves in efforts to stay in business, keep their suppliers in business and help consumers limit shopping trips. Big chains that have done this, such as Panera and Subway, have ample resources to pull this off. But the little guys—like Brix—have really had to get creative.
Especially when it comes to delivery. This service requires an infrastructure that’s challenging to build on the fly. Who will do the driving? How big of a service area is reasonable? If delivery is an option, will enough consumers bite to make it worthwhile? How much are people willing to pay to have groceries, prepared meals or farm-direct grass-fed beef brought to their front door?
These are tough questions, and depending on where the business is based and the specific circumstances and needs of its community, implementing delivery may not be achievable. But if a restaurant, cafeteria, marketplace or manufacturer can pivot to make it work, they could unlock a new revenue stream, gain a new way to market their brand and potentially attract new customers. As you do this work, remember you are not alone. Join Edible-Alpha for our Monday huddles, both for consultants and entrepreneurs, where we talk about national trends and pivots that are working.
And now, our roundup of the best food and beverage finance news, events and resources from around the web…
Business Model Insights
- E-commerce Radar: A look at Q2 and what brands need to do now (New Hope Network) Consumers are up for grabs right now. To win them, brands must focus on increasing their visibility and proving value. For e-commerce, that means doubling down on marketing and content budgets and focusing on how products appear on digital shelves.
- Three essential steps to successfully build a leadership team (FoodNavigator-USA)
- Immigrant-Led Food Startups Face an Uphill Battle in the Pandemic (Eater)
- How to think about raising capital and driving trial in these changing times (New Hope Network) “In evaluating investment opportunities, the concept of resiliency—highly flexible and nimble companies, people, supply chains and revenue streams—has never been more important.”
- Innovative food startups raised more in H1 2020 than they did in the whole of 2019 (AgFunder News)
- How to Email an Investor You’ve Never Met—and Get a Response! (Entrepreneur)
- CPG companies strategize how to maintain new consumers, market share as pandemic sales normalize (FoodNavigator-USA) As record sales from March and April flatten out—but still hold higher than last year—CPGs are trying to convince investors that they can keep new customers and sustain momentum moving forward.
- Loop makes reusable packaging convenient and beautiful for retail (New Hope Network)
- Innovation takes on a different meaning as pandemic forces CPGs to get creative (Food Dive)
- Multicultural consumers changing grocery shopping (New Hope Network) In the not-too-distant future, the U.S. grocery retail experience will be shaped more and more by multicultural consumers, based on population growth and current shopping behaviors, new research finds.
- 7 Ways the Pandemic Has Changed How We Shop for Food (The New York Times)
- Online grocery sales stabilize as market enters new growth cycle with ‘large base of committed shoppers’ (FoodNavigator-USA)
Farming and AgTech
- Should states require food and farm businesses to test their employees for Covid-19? (The Counter) “Public health experts agree that agricultural operations urgently need widespread testing. But the logistics are complicated, the rules can feel onerous, and resistance has come from unlikely places.”
- USDA Reduces Oversight of Egg Industry (Modern Farmer)
- The future of farming is human-scale (Beside)
- Nestlé CFO shares plans for ‘sizable acquisitions’ in the future (Food Dive) In deciding whether to acquire a company, the world’s largest food manufacturer wants to see alignment with its nutrition, health and wellness focus. Brands must also fit culturally and provide financial return.
- Farmers Business Network to Spin Out New Venture to Track Carbon Footprints of Crops and Help Farmers Make More for Low-Carbon Ones (Forbes)
- HSBC launches new funds targeting niche ‘natural capital’ industry, hoping to take it mainstream (CNBC)
- Edible-Alpha® Consultant Huddle: 9/28 at 1 p.m. CDT
- Edible-Alpha® Entrepreneur Huddle: 9/28 at 2:30 p.m. CDT
- Spark Change Modern Health Community Event: 10/7
- Produce Marketing Association Fresh Summit: 10/13–10/15
- Food & Nutrition Conference & Expo: 10/17–10/20
- Food Safety Summit: 10/19–10/22
- Food Edge: 10/21–10/23
- Spark Change Organic & Regenerative Agriculture Community Event: 10/28
- PACK EXPO Connects: 11/9–11/13
- Spark Celebration: 11/10–11/11
- Kosherfest: 11/10–11/11 in Secaucus, NJ
- PLMA Private Label Trade Show: 11/15–11/17 in Chicago, IL
- American Food Manufacturing Summit: 11/16–11/17 in Chicago, IL