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Food waste startup Flashfood is pivoting from grocery stores to delivery
When Toronto was introduced to Flashfood two years ago, the food-waste startup was an app that let shoppers buy groceries otherwise destined for the dumpster. For eco- and cost-conscious consumers, it sounded like a no-brainer — but it’s proven to be something of a tougher sell with grocery retailers.
To reach a wider network of consumers, the Flashfood team decided to turn to a new source of rejected groceries: farmers and growers, who are often left holding the bag for less-than-perfect produce.
“There’s a huge problem at that level of the supply chain,” says Flashfood founder Josh Domingues. “If a tomato or carrot is grown a little bit misshaped, then grocers won’t even accept those products for sale on their floor, leaving the farmer with no choice but to find another way to get rid of the product or, unfortunately, it is destined for waste.”
Their solution was Flashfoodbox, a produce delivery service that’s about to launch to the public after a successful pilot. The service will provide diners with a box stocked with eight to nine pounds of “ugly but delicious” fruits and veggies – from leafy greens, carrots and tomatoes to sweet potatoes, apples and berries — each week for $26.50.
“What we learned since we launched is the Canadian grocery industry is an oligopolistic industry,” says founder Josh Domingues. “There are maybe four companies that control the flow of food in our entire country, and we’ve met with senior executives from all of these companies. What we learned is that grocery retailers are not yet willing to utilize a solution to their food waste like Flashfood, which is unfortunate.”
Up until recently, their largest adopter was Longo’s, who partnered with Flashfood to offer a discounted-food section within a few local storefronts. Flashfood had asked to move into all 30 stores, Domingues says, citing appetite from their user community and strong economic metrics. “In the end, Longo’s decided that discounting the prices on their food, even the food that ends up in the trash, was not something they were willing to do in all of their stores and they didn’t want to continue with us any longer.” (Currently, Flashfood is only operating store kiosks in London and Vancouver.)
Domingues says the Longo’s pullout was unfortunate, but it “lit a fire” under the team.
“We’ve known for years that food waste is an issue along the value chain, and we thought if we could drive new customers into the grocery store – who happen to be young millennials who care about the state of our world – then grocers would be excited to scale with us. Instead, we’re going to go direct to these consumers.”
Flashfood has partnered with a Leamington-based greenhouse to stock the box, with more on the way. Domingues anticipates that stocking the box with local produce will become more challenging as the seasons get colder.
“That being said, we have relationships through our grower community that allow us to source food from all over North America with access to food as far as South America,” he says, adding they’re willing to partner with other packaged goods companies with surplus product. “We’re close to signing with a chocolate bar provider, because who doesn’t love chocolate bars?”
“We’re going to get you good, healthy, fresh and ugly food at a good price. No matter how we have to make that happen, we’re more committed than ever, and hope the Toronto community feels the same way. In the end, it’s consumer dollars that dictate how big of an impact we can collectively have.”
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