Social EntrepreneurshipNTMC Final Project Group G • AshwinPrakashNair – EunheeCho – HeidurHallfredsdottir – Marta LlaquetPujol – Rachel Lynn Donze
Problem identified: Food wastage • According to the UN, 1.3 billion tons of food is lost or wasted every year, which accounts to roughly 1/3 of all food produced in the world. • Food loss and wastage are contributing to rising prices and decreasing production, thereby increasing food insecurity in the world. • A lot of food is thrown out as: • It is unappealing • It is close to and/or passed it expiry date • More is bought than is actually needed • Some people can afford to waste food
Problem identified: Food wastage • Each day supermarkets throw away huge amounts of food that is edible. In Europe alone, more than 90 billion tons of food ends up in the dumpsters. • Western nations have twice as much food as is required by nutritional needs of their population. Half of that supply is wasted before it reaches the plates of the consumers. • UK households wastes on average 25% of all the food they buy. • Most commonly wasted are fruits, vegetables and bread. • One billion malnourished people are in the world. • Food wasted in the US in one year could satisfy the hunger of every one of them. • Less than a quarter of the food wasted in Western nations could lift the malnourishment of the one billion people. Sources: United nations and Food Waste Facts by Tristram Stuart.
Problem identified: Unemployment • Among EU countries, unemployment rate in Spain is the highest. • Unemployment rate in Spain is the highest in 17 years and is around 24%.
Problem identified: Unemployment • According to Economy minister of Spain, unemployment is the main source of vulnerability of the Spanish economy. • In the last quarter of 2011, the total number of unemployed Spaniards surpassed five million people. • One third of the unemployed of the Euro region are Spaniards. • The European Union’s statistics office estimates that half of young Spaniards (16-25 year-olds) are out of work, or around 50%, which is more than double the EU average. • Unemployment rate of the youth in Spain is the highest among EU countries. • The young generation has been hit hardest by Spain’s economic crisis, forcing them to move abroad in the hope to seek better future.
Useful insights about food wastage “The food banks usually only take the products that are in a perfect condition because the food banks want to maintain a brand image.” “Normally, food banks can have products which are about to expire for free if they arrange for pick-up.” “In the warehouse or logistics center: Products have a tolerance date and they are not sent from a logistic center to a supermarket if the expiry date is approaching. E.g. milk packages, if there are only 15 days until it reaches the expiration date, they don’t send the milk.” “Tolerance dates in supermarkets are shorter than in warehouses.” “Warehouses and supermarkets use inverse logistics to collect products that are about to expire to deliver back to the warehouses.” “Fruits and vegetables which has minimum quality requirements are thrown away as an organic waste (but it is not common).” “Most wasted products are yogurt, cheese, ham and fruits. Fruits are often not given to charity as it is very difficult to preserve.” “Food that has reached its expiration date is not given away as it can be bad for health or even contaminated.” “A supermarket would not offer products from wasted food on their shelves as the customers would not buy it would they know about its origin. Customers are very sensitive to expired products.”
Our persona • Mario, age 27, living in Barcelona • Jobless for 5 years • Living with his parents as he does not have his own home • Does not have enough money saved
Concept Overview • Medium-sized market positioned in locations that can be easily accessed by low-income shoppers. • Designed to build a clean, organized and fresh atmosphere. • Variety of perishable and non-perishable food covering “staple” areas, i.e. meats, dairies (cheese, milk, yogurts), fruits, vegetables, juices, snacks, canned goods, and frozen foods. • In-store café that sells transformed food from the market. • Out-of-store food truck that also sells transformed food from the market. • It will drive to areas with high pedestrian-traffic within the surrounding area, focusing on “on-the-go” snacks.
Tackling food wastage: The Market • From the outside, The Market would appear as most in Barcelona. Instead, it is the food stocked inside that is a key differentiator. This food would be “close-to-expiration-date” goods or those deemed unworthy, due to minimal to mild deformity. • The food would be received from wholesalers, distributors and surrounding supermarkets. • The necessary contracts: • The wholesaler would collect and organize all food that is generally considered unsellable for the distributor to pick up. • The distributor would then store this food in its trucks along with the food brought to traditional stores. • The unsellable food would be dropped off at a specified store along the distributor’s traditional route. • The Market would be in a contract with this store prior and be there daily with its own truck to pick up the unsellable food along with any food from that given store that would traditionally be thrown out or given to soup kitchens. • Along with the stores responsible for accepting The Market’s shipment, The Market’s truck would also stop at other local stores, which will also be specified through contracts, to pick up additional unsellable foods.
Tackling food wastage:The Market Café and Food Truck • On the day of or day before the food’s expiration date, it will be transformed into a snack or meal to be sold at The Market Café and Food Truck. • Examples of such food include: • Crepes with jams, fruits, and cheeses • Yogurts with a side of fruit • Veggie, meat and cheese wraps and sandwiches • Smoothies • Soups: vegetable, chicken, and noodle
Tackling unemployment • The following positions will be occupied by currently unemployed men and women: • The Market: • Distribution truck’s driver and product handler • Cashier and bagger • Stocker • Janitorial staff • The Market Food Truck: • Driver • Server and cashier • Market Café • Food transformation team • Cashiers
Tackling unemployment • These employees would be hired directly or through local temp agencies who will be advised on all available positions through a hired representative of The Market. • Once these employees are working, they will be offered personalized support from a hired career support officer that works with third-party sources to locate long-term jobs. Preferably, employees will eventually be placed in a job that is more suitable to their career path outside of The Market. Then, these opened jobs will be filled by new employees. • However, employees seeking longer-term employment with The Market will have the opportunity to move up the organizational ladder including: • Store associate manager • Store manager • Café associate manager • Café manager • Associate regional manager • Regional manager
Building Awareness • The Market, Market Café, and Market Food Truck will have posters and pamphlets informing customers that: • The food they are consuming is nearing its expiration date or was deemed unsellable by traditional stores. • Traditionally, much of this food is thrown out. • Statistics regarding hunger around the world, for example, “1 in 7 people in the world will go to bed hungry tonight.” Source: WFP
Prototype developed • Menu: • Juice • Sandwiches & pizza • Salads and smoothies • Soups • and etc. • Food café: • Produce food with ingredients provided from supermarkets • Food truck: • Produce food with same method used by food café • Has more mobility • Operated in crowded places such as beach • Employees: • Hired through public agencies • Opportunities are given to people who have been jobless for long period
Responses to the prototype:Employment – Food – Food Truck E Question: Would you accept the job (which has been described)? • “Yes, of course (I would accept a job at this type of supermarket), whatever it takes to get a job.” • “Yes, given the tough situation in Spain with the high unemployment rate, it’s a new opportunity to start again.” Question: Would you buy food that has been transformed from not 100% fresh products? • “I would buy them (unsellable foods) if they were cheaper.” • “I would buy food not 100% fresh. I don’t have any problem with it, most of the times I buy focusing on prices rather than on quality.” • “Yes, but if I had them at home I would be careful not to wait long to eat them.” F
Responses to the prototype:Employment – Food – Food Truck F Question: Would you buy this food (salads/sandwiches/etc.) at a café? • “I would be careful to eat them within a short period of time.” • “Yes, I would buy these foods in a cafeteria, specifically if you sell fruit.” • “I would be more careful with lactic products.” Question: What if the food was sold in trucks that travel around the city? - “A very good suggestion, they come close to your place and the food gets closer to you, it's comfortable and useful. And if it is cheaper, then is great!” • “Yes, its a good idea, if logistics allow it and if its possible to park the truck, Barcelona has a lot of traffic, it has many fruit stands around the city. I feel that it would fit best in a village; a food truck comes once or twice per week and people buy food there." T
Improved prototype E • Advertise the opportunity of being employed to jobless people to notice them. • Set menu focused on fruit items such as fruit juice or fruit jam. • Anticipate appropriate quantity of sales and produce food not to over the quantity. • Not to offer lactic products in the menu of café and food truck unless it is 100% safe. • Find locations that the food truck is able to park, due to a lot of traffic in the city. F T
Business model canvas Stocking food Transforming the food Transport food to cafés and trucks Educating employees Employ people in need Selling point Web Supermarkets Advertisements Email Supermarkets Distributors/wholesalers Employment agencies Unemployed people People concerned with food wastage and unemployment Sell transformed food Alternative way to help tackling food wastage, unemployment and creates awareness Expertise of a cook to chose the suitable food that gets transformed Staff Rental deposit Legal expertise Trucks Café Advertisement campaign Rental café space Food supplies Equipment Webpage Salaries Food selling in café Food selling in trucks Website advertisement
Key Partners • Supermarkets: Selling food products to the public. • Distributors / Wholesalers: Bringing food products to the supermarkets for sale. • Employment agencies: To link unemployed individuals to jobs that the supermarkets will be offering.
Key Activities Tackling food wastage • Stock food products that are not deemed worthy of selling because they are not 100 % fresh. • Transport and logistics to shuttle transformed food products for sale in food trucks. • Additional transport and logistics costs to shuttle rejected food products from wholesalers to supermarkets for transformation. • Process of transforming products that are not 100 % fresh.
Key Activities Creating awareness of food wastage • Educate the employees in supermarket cafés and food trucks so that they could impart this knowledge to the customers who patronize these stalls to buy food from them. Creating jobs for the unemployed • Employing people who need jobs and are poor.
Key Resources Human • Expertise in deciding whether food products that are not 100 % fresh can be salvaged or not. • Chefs who know how to transform these foods and still maintain its’ nutritional value. • Staff operating food truck should have qualified driver at the same time. Financial • Rental and renovation costs for café space and operating truck. Legal • License to sell food at the supermarkets and food trucks. • Cleanliness and health certifications authenticating new supermarket business.
Value Propositions • Coming up with an idea that reduces the pertinent food wastage problem, creates awareness for this issue and also to create jobs for the unemployed. • Transforming food products that are usually not deemed fit for sale, and then selling them in supermarket cafés and food trucks.
Channels Selling through: • Internet • Selling points (trucks and café)
Channels Purchase • Availability of food products at the café and truck. Home delivery for large orders in the future. Delivery • Educate the public and create awareness about the supermarket’s cause. • Encourage them to be proactive and to not waste food. After sales • Statistics to show how food wastage has been cut down by our efforts. • Rewarding customers with discounts and special offers.
Customer Segments Job creation within Supermarkets • Unemployed people who need jobs Food café and trucks • Regular shoppers who frequently go to supermarkets to buy groceries – people who are sensitive to the subject • People with low income
Customer Relationships Awareness • Supermarkets: Advertisements and marketing collateral. • Supermarkets: Employees within supermarkets who educate customers while they are shopping. Purchase • Café and truck: Availability of food products at the café and truck. Home delivery for large orders in the future. After sales • Home: Email with statistics to show how food wastage has been cut down by our efforts.
Cost Structure Capital is required for: • Rental space of the café • Renovation of the café • Supplies • Equipment for transforming the food products (e.g. blenders, fridges) • Salaries (for employees running cafes and food trucks, transforming food products, transforming food products into sellable food) • Marketing collateral (advertisements, leaflets, brochures)
Revenue Streams Sources of revenue • Food sold in the supermarket cafés • Food sold in the food trucks • Website advertisement viewership Pricing of food products • Food sold in cafés and trucks should be cheap (trade off since raw materials are not 100 % fresh) Methods of revenue collection • Cash or credit • Discount coupons or vouchers during special promotions
Now it’s time for some action… We believe our solution can help to address the problems of: * Unemployment * Food wastage * Creating awareness Let’s do it together and start now !