Ugly vegetablesharing economy

Outline• Background

• Sharing economy

• Benefits

• Business model

• Competition

• Marketing

• Limitations

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Background

• According to FAO, developed countries waste more than 1,3 billion tons of food every year, enough to feed 925 million people that are starving worldwide

• People throw away 7 million tonnes of food and drink every year in the UK

Consequences

• This waste has not only ethical but also environmental consequences, since it involves the unnecessary use of resources used in its production (like soil, energy and water) and the emission of carbon dioxin and methane resulting from the decomposition of food that is not eaten.

Rejected food

• Supermarkets dictate strict product specifications to farmers meaning that they’ll only buy fruits and vegetables that fit demanding size, shape and colour specifications – regardless of the nutrition, taste and value of the food. On top of this, last minute order cancellations by supermarkets and the businesses they are supplied by leave many farmers without any compensation and no market to sell their food to.

Rejected food con’t

• Major distributors demand fruits and vegetables that are “perfect” in terms of shape, colour and size, which ultimately restrict the consumption of foods that meet certain aesthetic standards.

• Such demand results in a waste of about 30% of what’s produced by farmers

PROBLEM

30% of the produce grown are rejected by groceries because of their shape.

SOLUTION

Deliver those fruits and vegetables to people

Sharing economy• Underused resources - “ugly” fruit and veg

• Emotional value - People care about food waste

• Customers don’t have time to go farm to farm, we collect surplus, seasonal veg/fruit and distribute

• Social data: want to drive bulk-buying, to reduce deliver costs - B2B and B2C matchmaking

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Ugly fruit and veg

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Benefits• Reduce food waste

• Up to 40% of fresh produce from some farms rejected by supermarkets because too “ugly” (BBC)

• Reduce food miles

• customer doesn’t have to worry about provenance

• Promote seasonal produce

• better flavour

• Reduce packaging

• CHEAPER

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Business model

• B2B: restaurants

• B2C: everybody

• Van delivery

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B2B• Restaurants

• Costs us for them to be specific (e.g. we only parsnips)

• Have to order over certain threshold to qualify

• Automatic form online, matchmaking

• Use data to improve business model (what’s in demand, when)

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B2C• Everybody

• Crates to cut costs

• Exclude button in app (cap on number of items you can exclude)

• Feedback with incentive (free crate, prize draw etc)

• Delivery costs reduce as more orders in your local area, incentive to refer + map showing delivery price falling as more people order

• Use data to improve business model (what’s in demand, when)

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Delivery & logistics• Collect from farms

• Take to warehouse (need a warehouse) to sort

• Take to people - discount delivery/crate price for multiple deliveries to same area

• encourage referrals to neighbours

• greener

• encourages community, neighbours take boxes for neighbour or alternative place

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How will we make money Revenue = (p - c)*q

• Costs

• buying produce - farms are currently throwing this away, will prefer to make some profit.

• Warehouse purchase fixed cost

• Van need grows with quantity but so does efficiency (local reward scheme - cheaper for customers)

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• Conservative price estimates

• USA: 7-9 lbs. produce = $13 = £8.90 ▶︎ £2.70/kg

• Portugal: 3-4kg produce = €3.5 = £2.70 ▶︎ 90p/kg

• Aldi: mushrooms: £2.36/kg, potatoes: 79p/kg…

• The Independent: “Tesco is selling 'wonky veg' for up to half price in bid to curb food waste”

• ……………… <— 500 people

How will we make money Revenue = (p - c)*q

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Competition• Supermarkets: have only just

started selling ugly fruit and veg

• customers still have choice

• not local, not seasonal

• Other companies: operate only on small scale

• tastymisfits.com

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Marketing• Collect data on initial users to identify customer demography

• Analyse demography change over time, patterns

• Word of mouth, online & in person

• Local referral cuts prices

• UK chefs with large public platform on board with anti waste (see Jamie Oliver school meals)

• Social media competition for best pic of strangest fruit

• Socially conscious blog with interviews with producers and tours of farms

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Limitations

• disparate demand or supply reduces efficiency

• need to reach “critical mass” for profitability

• general supply/demand match up problems

• price fluctuates with demand (using data)

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Thank you

• #saveUglyFood