Disrupting the Food and Beverage Industry

The trends causing the biggest food revolution were here well before we had ever heard of the word COVID

Gwen began her day with a glance at the calendar.

It was Tuesday, so the morning would begin with a virtual tour of all the company’s production facilities.

As VP Operations for TechGrow, she was responsible for the company’s production of plant and plant-based products over its 12 micro-sites (each located to be closest to the population centers it served), as well for its fleet of electric last mile delivery vehicles that served local homes, restaurants, schools and residential care centers.

She plugged in her augmented reality headset and connected to the first facility.

Martin, the plant manager, met her on the floor.

Their discussion focused mostly on new plans to repurpose the substrate used to grow their green leafy products. They were already turning it into insulation materials for construction, but Gwen had been pushing Martin to see if he could come up with a higher value application.

She listened as he explained how he had enrolled the local university’s faculty of food engineering and how they had deployed a new Dutch technology to weave the substrate fibers into a biodegradable packaging that could be used to carry their product and that was approved by all of Canada’s municipal composting sites.

Gwen was impressed. Turning the substrate into the packaging was ingenious. Making it compatible with the still unharmonized municipal processing infrastructure was an even bigger win.

She congratulated Martin and asked him to prepare prototypes that could be shared with their internal ambassadors and their groups of influencer customers. Finding stories to share with their employees and customer-fans was part of how TechGrow got people excited about pushing the needle on circularity. It was a key part of Gwen’s job description, and this was a story she wanted to share as soon as possible.    

Saying thank you to Martin, she moved through the eleven other virtual site visits over the course of the morning. As she moved from one to another, she was reminded of the criticism they had received, back in 2021, when TechGrow chose not to build large factories, as so many of their competitors had done, but to deploy a dozen micro-sized facilities in each of their key urban centers.

Gwen remembered how her colleagues in the industry told her that she was nuts to try and manage twelve sites across the country, that there would be no economies of scale and that their collaborative distribution model was crazy.

But, four years later, TechGrow had won pretty much every award in the business. Their local model was being applauded not just for its circularity and sustainability but for its profitability and there was a long line of people queuing up to take her job, should she ever want to move on.

And perhaps more importantly, they had helped kickstart a circular local food production revolution which was changing the way that Canadians shopped and ate and was starting to drive the waste out of the system.

Talking of eating, Gwen figured it must be lunchtime…

In a couple of weeks’ time, 16 companies - all of whom have ambitions similar to that of the fictional TechGrow in the story above - will graduate from the R-Purpose MICRO Accelerator.

They will celebrate their success by pitching their visions of the future to a group of investors, retailers, politicians, government funders and food industry influencers and leaders.

And they will all lead with the circularity credentials of their businesses: how they are leveraging circularity to fast-track their growth, not just through the traditional concepts of waste and packaging, but through the creation of regenerative business cultures, data-driven reporting, reinvented distribution models and more.

In short, these companies, all of whom have fewer than five employees, will showcase how they are going to use circularity to disrupt the food and beverage industry.

As I write this, in November 2020, I truly believe we are poised at the cusp of the biggest revolution to hit the world of food in a century.

And while it is being accelerated by the pandemic, the fundamental trends that are causing it were there well before we had ever heard of the word COVID.

These trends I have written about many times.

A food system that operates at 40% wastage levels.

A distribution and retail system that is centralized, normalized and governed by just-in-time and volume which means that the average Canadian meal travels 1,200km before arriving on the plate.

A downward pressure on margins that render the business case for nutrition almost impossible.

And a dehumanization of food production.

Put in simpler terms, the problem is that we grow stuff, we eat only part of it and the rest we throw away. And that fundamentally is unsustainable and doesn’t work.

The opposite of this is a circular food system.

A circular food system keeps as much energy, nutrients and materials as possible cycling through the system for as long as possible.

And while that might sound relatively simple, it’s not. Because it requires us to think differently.

Let me explain….

On my desk right now I have a plastic water bottle. Today it works great. But once it gets cracked, or the little button I have to push to get the water out breaks, it will no longer work properly.

And because I don’t want a leaky water bottle in my purse, I’ll probably end up throwing it away. Or (more likely) I’ll put it in a box in the garage for a couple of years because I feel bad about throwing it out, before I do finally get rid of it when I next do a spring clean on the garage.

My brain has been trained to think of this water bottle as an object with one purpose, and when it can no longer fulfil that purpose, then it has no more value and needs to be thrown away.

This is called a “Take-Make-Dispose” way of thinking. And it’s what all of us do, all of the time, because it’s the only way we’ve ever been taught to think.

But a “Take-Make-Dispose” mindset in the food system has led us to the problems I listed above: the 40% waste, the dehumanization of food, etc. And it doesn’t have a future.

A circular mindset requires me (requires us all) to think differently.

Instead of seeing that now leaky water bottle as broken and therefore having no value, I need to start to ask myself what value it can have. How can I keep it “cycling through the system” for as long as possible before it ends up being thrown away?

And that starts with a series of questions.

First - can I actually fix it? Is there a little spring that needs replacing to make that button work again, or can I cover the crack with a piece of duct tape or something so that I can restore its initial function?  

Second - if I can’t fix it, is there anyone else who can? Fixing things is rather coming back into vogue right now, with TV programs galore about bringing life back to old toasters and threadbare jeans, and repair clubs springing up in towns and cities across the country. But we need to do much more in this space. In a circular economy, you can return items to shops several years after you first bought them and they can help you source parts and repair them. That’s what we need to move towards.

Third, if I can’t fix it and no-one else can either, can I repurpose the water bottle to be (for example) a container for my son’s paintbrushes and give it another life somewhere else in my home?

And finally, when even its purpose as a paintbrush holder has come to its natural end, how can I recycle the elements that make up this plastic water bottle so that they can be reused in another product that will have another long and happy life in someone else’s home?

It’s a different way of thinking.

And that’s why it’s such a big deal that these 16 companies are going to be pitching their circularity credentials and vision: it means that they’ve already embraced this new way of thinking and started to apply it to their business. And it also means that they are going to be able to use it to differentiate themselves, fast-track their growth and appeal in new ways to consumers.

The fictional TechGrow story that I told you about earlier has elements that might sound like science fiction today. But every single idea in that story was sourced from one of the entrepreneurs in these sixteen companies.

The micro production sites, to serve local markets, are already embedded into the business model of two of these firms doing vertical farming.

The fleet of electric delivery vehicles came from discussions about how Direct to Consumer last-mile delivery could be made more collaborative and cost-effective.

The application of food science and engineering to repurpose substrates is already happening and we are working on a project today to create Canada’s first dedicated Lab to do just that, with the view to scaling the offering to more companies across the country.

The internal ambassadors and customer-fans are part of a new movement in Regenerative Corporate Cultures that is set to become the new frontier in developing inclusive, creative and sustainable corporate environments based around a circular (rather than take-make-dispose) mindset.

And the AR headsets? Well, we had a demo a couple of weeks back, and it’s not just impressive but it’s far cheaper than we would have imagined…

Shifting a mindset is the hardest part of any change. Gwen, Martin and TechGrow provide just one fictional example of what happens when you do begin to think differently. A fictional example based entirely in the reality of small food and beverage companies who are ready to disrupt the industry.

The revolution is coming.

But now it really is lunchtime….

Cher  

PS - to find out more about the R-Purpose MICRO Accelerator, to apply to join a future cohort, or to let us know how you would like to support the program, please email me or visit www.provisioncoalition.com/rpm

PPS – On December 3^rd from 1-4pm, you’re welcome to join us on Zoom to hear the ideas for the future from the 16 companies who are set to graduate from the current cohort of the R-Purpose MICRO Accelerator. Register here on EventBrite.

Cher Mereweather

President & CEO

cmereweather@provisioncoalition.com

P 519.822.2042 x1

C 519.803.6395