MONTEREY, Calif. — By delivering “imperfect” produce from growers seeking secondary markets to millennial consumers concerned about food waste, San Francisco, Calif.-based Imperfect Produce SPC (Social Purpose Corporation) has found an enthusiastic market in California.
Ronald Clark, co-founder and chief supply officer of Imperfect Produce, spoke May 23 at the Cal Poly freshPACKmoves 2017 conference. In a talk titled “Millennial and Ugly Produce — A Love Story,” Clark said the company’s sales have increased from about 150 boxes per week in the San Francisco market two years ago to about 10,000 boxes per week in San Francisco and Los Angeles in this year. The firm is making plans to expand to Portland and Seattle.
“It is truly a Millennial love story because the Millennial generation has embraced ugly produce in a huge way,” he said. Before coming out of retirement to help start Imperfect Produce two years ago, Clark had been working for the Food Bank Association in California for seven years.
Many young consumers feel that buying imperfect produce is an individual action that can help reduce greenhouse emissions and combat human-caused climate change.
“They are looking for ways to help the environment,” he said.
Surveys have indicated that food waste is the largest producer of methane in landfills.
A 2012 white paper by the Natural Resources Defense Council called “Wasted” revealed that 40% of all the food grown in America doesn’t make it to humans.
Mission and execution
Clark said the firm uses simple packaging, offering corrugated boxes in two sizes. Most of its customers pay between $25 and $30 per box for a big box of produce, he said.
While the company’s low prices — 30% to 50% lower than retail — preclude expensive packaging, he said the company was open to how packaging options could help the company.
“There is huge push-back from customers when we put packaged product inside (the box),” he said. “It is the balance between produce not being abused or bruised or damaged and the fact that (customers) want the farmers market experience.”
The company acquires mostly produce packed in packinghouses, as the scale of the company is not yet large enough to ask growers to field pack imperfect produce. Typically, vegetable growers today simply disc non-market grade product.
“Shed pack is easier to acquire because it is all harvested and brought into the shed and sorted,” he said.
What was once called food bank grade is now also called imperfect produce, he said.
Imperfect Produce pulls produce directly from growers with the cold chain completely intact, he said.
“We only (buy) from growers that are compliant with food safety and compliant with the cold chain and we hire independent carriers to bring produce to our facilities in San Francisco.”
Growers like having more options for non-market grade product, though some worry that their market for “perfect produce” will be compromised.
“For the most part, growers love us but some of them hate us because they spend a lot of time marketing perfection,” he said “So there is that fear, but we want to be known as a grower’s friend, we want to expand their market so more people can eat fresh produce.”
The last mile
Clark said Imperfect Produce sorts through the produce the night before it is packaged. Deliveries, through an Uber-like third party system, are usually scheduled from between 6 p.m. and 11 p.m.
The company has a small program selling Imperfect Produce in northern California Whole Foods retail stores, but nearly all of its business is delivering directly to consumers, Clark said.
“We did try collection points but we moved away from that quickly because people didn’t show up and then you get into temperature abuses,” he said.
The company offers both organic and conventional produce, and customers can mix and match according to their preferences.
“We were all conventional in the beginning and now we are already 60% organic,” he said.
Clark said the company does buy market grade produce as well, mostly in the leafy greens department. “We do want to offer our consumers full diversity, not just what is rejected by Safeway,” he said.
Social media buzz
Social media buzz is important to the future of the company, Clark said, and Imperfect Produce monitors mentions of the company on social media.
‘We look at Yelp every single day and we respond,” he said.
The company aims for an approval rating of 99%. A single customer complaint is counted as 10 complaints, since some research indicates that for every one person that take the effort to complain, there are nine more people that are also unhappy.
Customers give feedback based on produce quality, missing items and delivery fails.
“The customer satisfaction experience is really key if you want to be shipping directly to peoples’ doors.”
High standards
For the sake of growers and for the purpose of reducing food waste, Clark said he would be pleased if more retailers relaxed onerous appearance standards on fresh produce.
“Talk to any grower and he will (say) that they self-censor the product on their own so it doesn’t get kicked, especially if it is going to the East Coast,” he said.
First-time Imperfect Produce customers often expect funny looking produce or twisted carrots when they receive an order. Instead, many find the produce quality they receive is well above their expectations.
“People are shocked when they see what they are able to get,” he said. “It’s shocking to consumers what doesn’t make it to the market.”
Of course, Clark said Imperfect Produce standards don’t allow all flawed produce to make it into their customers’ boxes.
“It could be too big or too small, off color, but it still has to have the same eating quality and it has to be sweet, it has to be crisp.”
A crack might be acceptable on a carrot but not so on an apple, Clark said.
“If there is a healed over crack and there is no decay problem with it, then we can definitely take that,” he said.
Clark said Imperfect Produce sometimes buys market grade fruits and vegetables when the market is over supplied.
“If the market is flooded, that the point we will buy market grade, because it is already packed and they can’t sell it,” he said. If the produce isn’t moved, the produce would be sent to a land fill.
Clark said Imperfect Produce is a social purpose corporation, and some of those values are being friendly to growers and seeing to lower food waste at the farm level.
If their efforts contribute to more retail purchases of ugly produce, Clark said that would be a fantastic development.
“We are educating people on the beauty of all the produce that is grown, not just what you see in the retail store right now,” he said.