Frivolous lawsuits? Hiring challenges? Raising money? 'Mafioso-like business practices' from distributors? FoodNavigator-USA quizzed food & beverage entrepreneurs and CEOs to find out what is keeping them awake at night as they head into 2019...
John Foraker, Once Upon a Farm: I am worried about the economy, and the impact of a recession coming out of nowhere and slamming the natural and organic food space. If we have a shock of some kind triggering a recession that impacts consumer confidence, it will impact this space.
Retailers will pull back on breadth of assortment (predominantly impacting smaller brands). Consumers, retailers & big CPGs will be more price sensitive and less willing to take risks on new innovation. Investor capital will become harder to get, and many other similar impacts.
This is an inevitable cycle that we saw in 2000-2001, and again in 2008-2009. Many participants in the industry now are relatively new and I don’t think they are aware how economic cyclicality impacts the business in this space.
People are constantly looking for better and healthier options, which helps insulate to a degree, but not enough if the economy gets rough. Value becomes more important in these times and every business needs to think through what that means for their plans
Aidan Altman, Fora Foods (Faba Butter): There is still some disconnect in the way distributors and brands work together. Most distributors don't like to release sales data to the brands they work with. What the hell? We're a team - we need to work together! I'm not going to poach your customers - we're partners here :)
Neil Grimmer, Habit: The lack of supply chain transparency and traceability of certain agricultural products concerns me. The recent E.coli contamination of romaine lettuce highlighted a gap in traceability and containment of the food safety issue. Blockchain technology should be able to materially help find the source of contamination in an expedited manner, increasing consumer protections.
Livio Bisterzo, Green Park Brands (Hippeas): I’m spending a lot of time learning the direct to consumer playbook as I believe it will be transformational to our industry. Conventional CPG marketers haven’t come around to fully assess the new opportunity in the D2C space.
D2C brands are going to become major players across multiple industries as there is tremendous data to be gathered through direct relationships with consumers.
Katie Thomson, Square Baby: As a mom and an RD, I’m frustrated by the misleading marketing to parents looking for convenient, healthy options. Where are the proteins, veggies & healthy fats? Where is the balance? Why are baby foods often just applesauce with a sprinkling of superfoods?
Nik Ingersoll, Barnana: Distributors engage in mafioso-like business practices that actively attempt to rob brands of cash. It has to be the single, most mind-boggling part of our industry that very few people are willing to discuss publicly in fear that they will be retaliated against.
The non-regulated nature of the CBD category also scares me given the past two administrations have a robust history of raiding state-legal medical marijuana collectives.
Scott Fiesinger, Field Trip Jerky: It's hard to find a balance between what is forward trending but isn't a food fad, what is fresh and innovative but also mainstream and widely accepted, tasty but still healthy, portable and yet satiating enough to satisfy on-the-go hunger, and if you can answer all of those, maintain a shelf life that allows you to bring it to a market with as little complexity as possible.
Paul Shapiro, CEO, The Better Meat Co: What keeps me up at night is the urgency of reducing our reliance on raising animals for food. There's much progress being made both in plant-based meats and cultured meats, but is it fast enough to avert the most pressing food-related problems we face?
Nick Desai, Snack it Forward: The biggest challenge is the vast amount of information and mis-information and the fragmentation of the market. It's harder and harder to reach your audience with an authentic message because there is a lot of noise and clutter out there.
It's also frustrating to see many retailers go from being true merchants to purveyors of real estate. When shelf space goes to the highest bidder instead of the best products, it is not in the best interest of the consumers.
David Benzaquen, Ocean Hugger Foods: The biggest challenge is for small companies like ours is to scale manufacturing. The leap from small co-packers that can't produce in an efficient way to a large co-packer requires such a jump in volumes. It's very difficult to cross that chasm.
Anshu Dua, The Chaat Company: What keeps me up at night is access to capital as a food startup which still pales in comparison to other industry. Investors need to take bigger risks in food as they have done in technology and other industries.
Raymond Chung, Greenwave Foods: What keeps me up at night are costs. Since I manufacture my own products, high and rising labor costs, as well as increasing cost of steel (which we use in our equipment and facility), due to the trade conflict, are the prime issues.
Daniel Nicholson, Nadamoo: I’m concerned about the frivolous overinvestment of capital into an industry that has so much potential value to add to the greater good if we remain mostly aligned on purpose.
Miyoko Schinner, Miyoko's Kitchen: For us, going from a scrappy start-up to scaling our brand so quickly has meant the need to hire A-players quickly, something that has been challenging and kept me up many nights. At the same time, the fast scaling itself has presented production challenges while we figured out how to create cutting-edge processing technologies and meeting demand.
It's been a 24-hour job at times! And of course, I have to mention the frivolous lawsuits that take up our time and resources -- the flip side, of course, is that they bring light to the success of our industry and create even more exposure. All in all, the fun and excitement of building this brand has outweighed any frustration or sleepless nights.
Paul Lightfoot, BrightFarms: No one should get sick from salads. Consumers have growing doubts about the standard of our nation’s produce due to the recent Romaine recalls and it’s crucial that the industry re-build that trust. Local, indoor farming can help solve the structural challenges facing the produce supply chain.
Bryan Crowley Soylent: 9.7bn people are projected to share the planet by 2050, so we’ll need to increase food production by more than 70% to feed all those people. Ultimately, we all need to work together to find sustainable solutions for making food accessible to everyone.
At Soylent, we see GMO technology, and its implications on water usage reduction and nutrient density, as a key aspect in tackling our planet's issues of overpopulation and sustainability. We also see a lot of room for capital for investment in that space.
With the help of cross-sector partnerships, advances in science, and new technology, we can address this global crisis. It’ll take innovative companies, academics, and researchers all working together, producing products and solutions that consumers will choose and enjoy. And here at Soylent, we’re committed to being part of a more sustainable future for everybody.
Joel Warady, Enjoy Life Foods: With over 40 years in the CPG space, I personally believe we are in the most challenging time we have ever experienced. The market is more fragmented, retailers are challenged, corporate boards are demanding higher profitability, and faster, and we truly are experiencing the most challenging business environment I have ever experienced.
It also means that those companies with the best talent, and the most well thought-out strategy, have the best chance of winning.
Billie Thein, New Barn: Concerning is the trend toward commoditization—in agriculture, distribution, retail, even eComm. Monocultures are almost never healthful. They elevate 'scale' over authenticity.
Nicole Gallace, Foodgrads: Hiring challenges are a real concern as we know there is about to be a mass exodus due to baby boomers retiring. The issue being, young people not seeing the industry as a viable career path.
While I have started a platform to address this concern, my frustration is the lack of industry support for this problem. Most companies believe the government need to be on top of this—and that may be true to a degree—but the reality is industry needs to play a bigger role in the problem. Offering experimental learning via internships and co-ops and definitely sharing their entry level jobs somewhere students and grads can find them!
