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Articles from 2019 In May


[email protected]: CBD, the FDA and Ben & Jerry’s | Tomatoes rising—before the tariffs

Getty Images cbd from hemp could become a food additive

FDA considers safety of food infused with cannabis extract

The FDA on Friday conducted a hearing about allowing cannabidiol-infused foods and beverages. Acting Commissioner Ned Sharpless pointed out that it will be difficult to regulate CBD because it hasn’t been researched, but hemp farmers and other advocates urged him to act quickly. Read more at The Wall Street Journal

Ben & Jerry's plans a CBD-infused ice cream, pending FDA approval

Add Ben & Jerry’s to the pro-CBD infused food list. On Thursday, the Vermont-based ice cream company known for its amusing flavor names and cartoony packaging announced it hopes to release a cannabidiol-infused flavor as soon as the FDA approves such edibles. The company submitted its pro-infusion comment before Friday’s hearing. Read more at CBS News

Tomatoes are about to get expensive

Earlier in May—before President Donald Trump decided to impose tariffs on Mexican goods—the Department of Commerce decided to terminate the Tomato Suspension Agreement between the United States and its southern neighbor. Until a new deal is in place, that means Mexican tomatoes will be slapped with a 17.5% tariff. Read more at Modern Farmer

13 siblings saved their family with their dying dad’s protein bar recipe

In the 1990s, a traveling supplements salesman who hauled his then-seven children around the country him created a peanut butter protein bar, Twenty-some years later, those seven kids and their six additional siblings used that recipe to start a new a new company and save their family as their father suffered from melanoma. Read more at Forbes

On the trail of tupelo honey, liquid gold from the swamps

Tupelo honey, known for its unique tasty and buttery feel, is the most expensive honey in the country. Even as the plight of pollinators challenges food production around the country, a dedicated group of Southern beekeepers are keeping tupelo honey in production. But their numbers are declining as hurricanes batter both the tupelo trees and the beehives. Read more at The New York Times

IdeaXchange

What’s the right channel for your brand?

Elliot Begoun

A question asked all the time is “What’s the right channel for my brand?” Founders wonder if they should go to brick-and-mortar retail or focus on direct-to-consumer (DTC). My answer is as clear as mud: It depends. For some brands, it makes perfect sense to launch into retail. For instance, if it is a better-for-you analog with a low-educational threshold.

An example of this would be one of our portfolio brands, The Good Crisp Company. As a canister chip with an understandable brand promise built right into its name, putting it on the grocery shelf and offering consumers a much-needed alternative was a no-brainer.

Other brands are better suited to build traction DTC. Dr. Cowan’s Garden is another one of our brands. As producer of high-quality biodynamically grown vegetable powders it leverages the direct relationship it establishes with the consumer to educate them on how best to increase the biodiversity of their diets.

For most brands, especially those that are solving lifestyle problems or are filling unmet needs, I like a channel strategy that builds concentric circles around the targeted consumer. First, I will explain what I mean by a concentric circle strategy. Then I will offer the reason why, for most brands, I feel it is the best approach to building lasting consumer traction.

The strategy is straightforward and is narrow and deep. I recommend focusing on 1-3 core markets. It is an omnichannel approach to meeting the consumer where they live, work and shop. It starts with empathy requiring an understanding of where the problem is most acute or need most defined. A good illustration would be Native State Foods which recently pivoted its offering to ancient superfood breakfast bites. Its consumers live in yoga studios, gyms, running shops, airports and more. It recognized that having the product available at corporate campuses and micromarkets, places where its shoppers work. Finally, ensuring that it is available on the shelf at their neighborhood stores and on the e-commerce platforms they visit, completes the last of the concentric circles. Thus, the brand becomes somewhat ubiquitous within the consumers’ field of view.

As mentioned above, I do believe this is very powerful and here are a few reasons why:

Discovery

Brick-and mortar-retail outlets are tough and expensive places to drive trial. You are competing for attention with 35,000+ other products and for a consumer who is very habitual in the way they shop. D2C is also tough. First of all, it’s hard to stand out among the sea of products. Plus, many first purchases made are done so on impulse, and most consumers don’t want to make too large a commitment without trying an item.

Capital efficiency

Since a concentric circle strategy is narrow and deep, it slows the burn rate. You’re not paying for a lot of slotting or promotions. You are not managing a sophisticated logistics network and don’t have national brokerage commissions or retainers. You can learn a lot about your product and its consumers in a less expensive manner.

Social media impact

Geofencing or geotargeting makes your digital efforts more effective. You become a louder voice to a smaller audience. It brings forward the opportunity to leverage microinfluencers costing you less and allows you to be bolder and more creative in your approach.

Social Proof

When your brand is available where people live, work and shop you help your consumers tell your story. Social proof is one of the most potent purchasing motivators. When friends see friends using a product frequently, they want to try it too.

Validation

Let’s talk about investors for a moment. Two critical variables that most investors consider are validated assumptions and proof of consumer traction. A concentric circle strategy allows you to do both faster.

In my experience, this approach is highly effective, makes good sense, but, is admittedly hard to execute. As founders, you already know that what is right is rarely easy. If I can be of any assistance or provide any greater depth of information, please don’t hesitate to reach out. 

Elliot Begoun is the founder of TIG, a 1:1 program that helps natural product brands grow, positioning them to raise capital, prove velocity, build community and scale. 

Home-care products come clean

Natural-Grocers-cleaning-products.png

Like their counterparts in the food categories, cleaning products are undergoing a metamorphosis brought on by the pressures of consumer interest in sustainability, health and convenience.

The same shopper who’s buying a free-range rotisserie chicken raised without antibiotics because it checks all those boxes might also be looking for cleaning solutions that make their lives easier, and at the same time offer added benefits for their health and the environment.

“Because of increased awareness of environmental issues, the use of environmentally conscious cleaning products is a growing trend among families,” said Mark Mechelse, VP of insights and communications at the Global Market Development Center, based In Colorado Springs, Colorado. “To that end, cleaning-supply manufacturers are increasing innovation of chemical-free products and highlighting eco-friendliness in their branding by calling attention to any plant-based, certified organic, all-natural, nontoxic, hypoallergenic or synthetic-free ingredients.”

Brian Sansoni, senior VP of communications, outreach and membership at the American Cleaning Institute, Washington, D.C., said that in addition to focusing on cleaner and greener products, manufacturers also have been focused on innovations around convenience, such as unit-dose laundry detergents and toilet bowl cleaners featuring disposable scrub pads that detach from the wand.

“It’s a competitive category, and companies are looking for that edge either through their own innovations, collaborations or acquisitions,” he said.

The cleaning-products category overall has shown modest growth in recent years. According to Nielsen, sales of household cleaners and supply items have seen four-year compound annual growth (CAGR) of 1.2% in dollar sales across all retail outlets, including convenience stores. Sales in the 52-week span through March 30 totaled about $7.56 billion. The laundry-care category, which is measured separately from household cleaners, had a CAGR of 2.1% during the past four years, and generated sales of $12.38 billion in the latest 52-week span.

Green_products.pngGreen cleaning

The trend toward natural cleaning products plays right into the hands of retailers such as Lakewood, Colo.-based Natural Grocers by Vitamin Cottage, which adheres to strict criteria around all of the products it carries, including home-care items.

“Natural Grocers only carries the simplest cleaners with the fewest ingredients possible,” said Shaun Foy, category manager, Natural Grocers. “We believe in transparent, full-disclosure labeling. We do not carry artificial fragrances or colors and always look to source the safest cleaning ingredients available.”

He said the company references the latest scientific research around cleaning items and relies on literature from groups such as the Environmental Working Group (EWG) to help it curate its 12- to 16-foot cleaning products assortment.

In addition, Natural Grocers strives to offer items that minimize packaging and maximize energy savings. These include items such as dryer balls that can be reused and cut drying time, and concentrated cleaners that last longer and take less resources to package and ship.

Natural Grocers also said it has seen renewed interest in old-fashioned cleaners such as washing sodas and vinegar-based cleaners. The retailer also carries essential oils, vinegars and castile soaps for customers who want to make their own cleaners, along with books that offer guidance.

Conventional retailers, meanwhile, have been expanding their own green private label cleaning-product assortments.

Minneapolis-based Target, for example, in April introduced a new home essentials brand, Everspring, which complies with the retailer’s new “Target Clean” standard. In the cleaning-products category, that means the items lack certain chemical ingredients, including phthalates, sodium laureth sulfate, propyl-paraben and butyl-paraben.

Target created graphic icons for the front of the products’ packaging to make it easy for customers to determine certain attributes. The 30-plus color-coded icons include statements such as “No Formaldehyde-Donating Preservatives,” “Made Without Parabens” and “100% Natural Fragrance,” among others.

The Everspring assortment is being merchandised in the respective aisles where their conventional counterparts are displayed, and within the “Target Clean” section of those aisles.

Cleaning_products_aisle.pngMerchandising cleaning product

Consumers are seeking cleaning-product solutions consisting of multiple products that work together, said Mechelse of GMDC.

“To drive more foot traffic to the cleaning-supply aisle, consider grouping products as a complete solution set by occasion—such as allergy relief and spring cleaning—rather than by type,” he suggested.

In fact, seasonality is another area where cleaning products share similarities with their food counterparts, and it presents merchandising and promotional opportunities for retailers. While many retailers roll out spring-cleaning promotions every year, other occasions and events also lend themselves to cleaning-products promotions, said ACI’s Sansoni. These include back-to-school, cold and flu season, holiday entertaining and summer outdoor living.

He suggested combining displays of cleaning solutions and related products on endcaps, such as grouping disinfectant wipes, hand sanitizers and hand soaps for flu season, for example.

“You want seasonal cleaning to be front and center,” he said. “Tie it all together and make it instinctive for the shopper.”

Gadgets, accessories in the spotlight

While cleaning-product manufacturers have been working to make their products healthier and more environmentally friendly, the devices that are sold alongside the detergents and cleansers have also been undergoing some innovation.

Cleaning_gadgets.pngNaomi Sleeper, VP of continuous improvement and strategic initiatives, Imperial Distributors, said suppliers are taking steps to make their cleaning gadgets more eco-friendly by using sustainable materials such as bamboo and adopting more sustainable manufacturing processes.

Among other trends Sleeper identified:

• The growing popularity of reusable straws and water bottles is spurring the creation of new cleaning gadgets for those items, she said.

• Products that can be used to clean hardwood floors have seen increased interest from consumers as more households feature such floorings.

• Manufacturers are expanding their offerings to reach high- and low-end consumers with different price points.

• Products that offer ergonomic, health or convenience benefits can command higher price points. Some of the high-end products, Sleeper noted, aren’t necessarily more sustainable, but may offer other benefits, such as the sanitary/health benefits of toilet bowl cleaner wands with pop-off disposable scrub pads. “Those are considered more hygienic, and you might pay more for that,” she said. “Those kinds of things are increasing in sales, and they are aligned with this healthy living trend.”

Supermarket News logoThis piece originally appeared on Supermarket News, a New Hope Network sister website. Visit the site for more grocery trends and insights.

 

What to look for when betting big on your food company

Entrepreneurship is risk-taking 101. Between the unknowns and the challenges (and sometimes the unknown challenges), it's a journey that involves betting as big as you want your company to grow.

Bill Keith of Perfect Snacks knows this well, and he knows the rewards that can come from big bets. So what's helped him succeed along the winding entrepreneurial road?

In this video, Keith shares the simple yet critical thing to look for when betting big on your food company.

[email protected]: TSA updates in-flight hemp CBD policy | Agriculture company awarded 'most disruptive'

tsa-cbd.png

TSA changes policy to allow some CBD oil and medications on planes

TSA quietly updated its policies over last weekend “to allow passengers to bring some forms of cannabidiol (CBD) oil, plus an FDA-approved marijuana-based drug, on flights.” All hemp-derived CBD oils taken on flights must comply with regulations defined by law under the 2018 Farm Bill. Read more at NBC …

Is Indigo Agriculture the world’s most disruptive company?

Out of all the company’s on CNBC’s recently published Top 50 Disruptors list, the No. 1 spot went to a relatively unheard of brand called Indigo Agriculture. Indigo’s aim is “to get all of these marginally beneficial services—like data-informed planting advice, drought-resistant seed treatments, transport services, and more—under one umbrella,” and its resulting data platform has afforded Indigo some hefty leverage in the agriculture arena. Read more at New Food Economy …

One thing that might keep the Impossible Burger from saving the planet: Steak

Plant-based meat alternatives, at least in supermarkets, aren’t having a significant impact on sales of actual meat yet, though CEO of Impossible Foods Pat Brown believes that competition between the alt meat and real meat industries is “imminent.” However, there’s one thing standing in the way of this: a continued desire for whole-muscle cuts such as steaks and roasts that are far harder for alt meat companies to replicate. Read more at The Washington Post …

KFC is meeting with plant-based ‘meat’ makers as chains such as Burger King and Del Taco jump on the vegan bandwagon

KFC is the latest fast-food chain to explore adding a plant-based meat substitute onto its menu. The chain has already seen some success with a vegetarian “fried chicken” product in the U.K., but is still in the early stages of meeting with alternative chicken manufacturers stateside. Read more at Business Insider … 

Crispr gene-editing will change the way Americans eat—here’s what’s coming

The first Crispr gene-edited products will reportedly begin reaching the market this year, and everything from produce to grains to meat may be affected in the near future. This technology is currently unregulated in the U.S., with the USDA having issued a statement last March “saying it would not regulate crops whose genetic changes could have been produced with conventional breeding." Read more at The Guardian …

Alter Eco ups the ante on sustainable packaging

Alter Eco chocolates

Alter Eco announced earlier this spring, in partnership with the Climate Collaborative and OSC2, a commitment to all recyclable or compostable packaging for its entire product line by December 2020. The company has already been using some compostable pouches and wrappers, but taking on all packaging for the full product line meant tackling a wider range of needs.

There’s the outer package that holds the truffles, which needs more structure and durability, for example, while the coconut clusters have different moisture sensitivity.

“Our goal has always been to create products that are as good for the planet and the people that make them as they are for the people who enjoy them,” said CEO Mike Forbes. “It’s really been in our DNA to think about the packaging.”

Alter Eco’s main focus now is a package for the coconut clusters. The company transitioned its 10-count truffle package from plastic-laminated paper to recyclable cardboard just after Natural Products Expo West. “We worked with a packaging company to come up with a solution that has the gloss and beauty, but doesn’t have the negative impact,” said Forbes. The individual truffle wrappers inside are already compostable, and the compostable pouches that the brand uses for quinoa won a NEXTY award for packaging when they were introduced.

The clusters have made for a tougher hill to climb. For Forbes, the three major criteria when considering compostable packaging are: It needs to work with the copacking machines; it needs to protect the product over time; and it can’t disintegrate on the store shelf.

The second one has been the most difficult, he said. “Right now, this is what we’re focusing on for the clusters—finding a solution to protect them, because they’re sensitive to moisture.”

If moisture gets in, he explains, it reduces the crunch factor. They’re currently evaluating a recyclable and a compostable option, testing mainly for longevity, to see how the product does over time. “That’s one of those things, there’s no substitute for time. We need to see how the product performs over two, three, four months,” said Forbes, estimating they’ll be able to identify the winning package by the end of the year and start rolling it out in early 2020.  

Partnerships

For Forbes, the real key to finding sustainable packaging options has been collaboration with other food brands and packaging companies—both to innovate and identify solutions together, more efficiently, and also to achieve the scale that will be necessary to make any new packaging option feasible.

Alter Eco has worked with Elk Designs, for example, which was able to take on the technical challenges like what materials perform best, and in what combinations—evaluating, for instance, how eucalyptus and birch perform, and determining that using the two together was the winning strategy for the compostable pouch.

Having partners can help when it comes to placing orders, too. “Companies like to do minimum runs of millions. We’ve partnered in the past with Numi Tea. That helps us to bring more volume to the table,” said Forbes. “Other companies are involved and want to use the same package, which helps us build scale,” he said.

“It’s definitely a team approach,” he said, recommending other brands adopt collaborative strategies when pursuing similar efforts. “For entrepreneurs, it’s really important to have a group of people to share learnings and share ideas with, and to bounce things off each other in a safe setting.”

The OSC2 consortium has been a strong resource, he added, bringing like-minded companies together for knowledge-sharing and generally building momentum on the packaging front.

“These things can be worked through, it just requires a little elbow grease and attention,” said Forbes.

Mission zero waste: How one co-op managed its Earth Month challenge

Mississippi Market in St. Paul, Minnesota

The Mississippi Market Natural Foods Co-op, which has three locations in St. Paul, Minnesota, held a Zero Waste Shopping Challenge in April. Board chair Heather Haynes challenged herself, general manager Gail Graham and consumers to shop package-free. We spoke with Haynes and Graham about the response they got from customers, the challenges they faced, and what they learned in the process. We also asked a representative from National Co+op Grocers to chime in about broader efforts underway.

First, tell us how this came about, and what kind of response you got.

Haynes: I really wanted to reexamine how I was purchasing things to see if I could cut out all plastic, and all packaging in general. It started as a personal challenge, but we felt we really wanted to broaden it. I decided blog about it, and we made the call to customers as well.

Graham: I think we got a smattering of interest. I had people commenting, saying they were following along and interested, or that it had sparked ideas for things they could do as well.

Heather Haynes Mississippi Market Seed SaverWhat did you learn along the way that may not have been obvious starting out?

Haynes: For me, and what I was blogging about, was that I really couldn’t do it alone. I could write 100 comment cards, but if no other members were using their purchasing power to influence what we carry and what manufacturers are doing, then I wasn’t going to be able to do much myself. We really need to use our collective power, rather than go at it alone.

Working in the industry, in natural products as well as conventional grocery, we can begin to influence suppliers to be able to operate in a more environmentally sustainable fashion.

What are some other obstacles?

Haynes: One of the things that was highlighted in talking to people is that it can be very challenging to balance the need for convenience with the desire for less packaging.

Bringing people to the point where they’re willing to let go of some convenience is important. Our customers tend to be receptive because they’re very values-driven—that’s why they’re members of the coop. We’re part of NCG (National Co+op Grocers). They’re developing a task force to bring some of us together, so we’ll be looking at and examining how to get plastics out of our store.

Did you discover anything that, looking ahead, will be useful or necessary for scaling this kind of effort further?

Gail Graham Mississippi Market (Rebecca-Wilson Photography)Graham: We need to be educating our customers about the choices we’ve made. For example, the straws don’t look much different than the plastic straws. We need to be highlighting around the store, in the deli, making clear which items are compostable, and we do have compost bins in the store for those things. And striking the right balance is important. You don’t want to have signage everywhere in the store, but some signage is important.

Haynes: That education piece is huge. Putting this in front of people is so important and continuing to work collectively to make a difference.

We also checked with National Co+op Grocers, which represents retail food co-ops around the country, about similar efforts on the national level. Sustainability Manager Sheila Ongie had this to say: 

Working toward zero waste is an issue that food co-ops and their shoppers care about, whether that is eliminating wasted food, avoiding unnecessary packaging or replacing hard-to-recycle materials. We find it concerning that even with widely available recycling infrastructure, only about 9% of plastic in the U.S. is recycled, which falls below both the European rate of 25% and global average of 14%. [Editor’s note: Ongie’s sources, respectively, are the Environmental Protection Agency, Global News, and the Ellen MacArthur Foundation.]

We know that globally the equivalent of a garbage truck full of plastic enters the ocean every minute and that if we do nothing that rate could quadruple by 2050. We also know that bioplastics such as PLA do not biodegrade in the ocean and are, therefore, not a solution to this very concerning issue. [Editor’s note: Data also comes from the Ellen MacArthur Foundation. PLA, or polyactic acid, is a plastic polymer made from renewable resources such as corn starch or sugar cane. It’s often used in 3D printers.]

As retailers, we’re positioned between suppliers and consumers with the opportunity to influence both, including which materials are used and the ultimate fate of those materials. We’re very interested in how we can best leverage our unique position to answer the question, “What can we do to eliminate ocean plastics?” With the formation of our new Better Packaging Solutions Committee, made up of representatives from food co-ops themselves, we’re ready to dive deeper in search of solutions.

We’re seeking solutions that meet the practical needs of food packaging (like food safety and preservation), while also helping us truly reduce ocean plastics and work toward achieving zero waste overall. While the committee’s work is just about to get started, we expect that it will result in a bold approach that will have an impact.

[email protected]: Amazon poised to purge thousands of suppliers | Glyphosate use increases across the Midwest

Pesticide spraying

Amazon is poised to unleash a long-feared purge of small suppliers

A large, permanent purge of thousands of Amazon’s mostly smaller suppliers is imminent in the next few months. These mom-and-pops will no longer be able to sell in bulk directly to Amazon, making the move “one of the biggest shifts in Amazon’s e-commerce strategy since it opened on the site to independent sellers almost 20 years ago.” This vendor purge is one of several steps toward Amazon’s goal of expanding product selection on its site while avoiding spending more money on managers to oversee everything. Read more at Bloomberg …

Glyphosate use increases dramatically across the Midwest

Farmers in the Midwest continue to use the controversial pesticide glyphosate in spite of its decreasing effectiveness and the thousands of current lawsuits regarding the substance’s adverse effects on human health. The Midwest Center reviewed data with low estimates of pesticide use on farms and still found that use was not slowing, while farmers are forced to spend more and more on both seeds and glyphosate in order to keep agricultural productivity at the bare minimum. Read more at New Food Economy …

Where the 2020 presidential candidates stand on food and farming

Check out where the current 25 presidential candidates stand on food and farming issues that are near and dear to the natural products industry. As the article notes, the role that rural voters played in the 2016 election has led many presidential candidates to hone in on and “address the challenges that abound in today’s farm country." Read more at Civil Eats …

Why suburban moms are delivering your groceries

Instacart reported that over 50% of its shoppers are women, and DoorDash has also noted that women make up over half of its employees in rural, suburban and urban areas. There are several reasons why moms and caregivers are turning to the gig economy’s app-based jobs to supplement income, but food delivery services in particular are appealing to this population for their flexible hours and relative safety—as opposed to, for example, being an Uber driver, which requires inviting strangers into their cars. Read more at NPR … 

Banned bread: Why does the US allow additives that Europe says are unsafe?

The FDA allows small amounts of certain chemical additives in food products that are subject to strong restrictions in other areas, such as the European Union. But for the last two years, the U.S.-based Environmental Working Group has been challenging the “generally recognized as safe” (AKA Gras) rule in federal court, a rule which allows companies to add ingredients into products that may have petitions against them from advocacy groups dating back decades. Read more at The Guardian …