Produce Trends & Business Opportunities In the Covid Crisis
Indoor Ag-Con kicked off its Indoor Ag-Conversations webinar series in June 2020 . Partnering with United Fresh , we hosted a webinar addressing produce trends & business opportunities in the Covid crisis. Moderated by United Fresh President & CEO Tom Stenzel, the panel included Paul Lightfoot, CEO and founder of BrightFarms, Alex DiNovo, president and COO of DNO Produce, and Victor Verlage, senior director of Agriculture Strategy Development at Walmart.
Kate Spirgen, editor of Garden Center, Greenhouse Management & Produce Grower magazines penned a terrific recap. In it, she outlined five key takeaways from the panel touching on produce trends and business opportunities in the Covid crisis:
1. Berries are big on the horizon.
Panelists agreed that berries will be among the next hot items in CEA since growers can provide tastier options with longer shelf lives than conventional farms. “How variable is a strawberry’s taste when it’s conventional?” DiNovo asked. “You can have one that tastes fantastic and you can have one that tastes like dirt. You can have the same flavorful berry without Mother Nature wreaking havoc on it.”
Highly perishable items with complex supply chains are ripe for disruption, panelists said.
“What we’re interested in is beyond the shelf life, we want home life for the customers,” Verlage said. “We don’t want them to waste produce because it goes bad quickly.”
2. Create value by standing out.
From a marketing standpoint, DiNovo said indoor agriculture operations shouldn’t fight a conventional battle. By creating new names for products and branding them to stand out, growers can change the game.
“Create its own value by calling it something else,” he said. “If you call it by a conventional name, you’re going to compete on a conventional price basis.” The coronavirus has impacted everything from supply chains to shopping habits.
3. COVID-19 has increased consumers’ desire to keep money local.
DiNovo said the economic impact of the coronavirus has led to a greater demand to keep money in the local economy. this is true whether it’s spending inside the community or providing jobs.
“That’s what local means to me more than anything else — it’s local impact,” he said.
4. Labor and supply chain concerns could lead to opportunities.
Lightfoot said he sees an opportunity to promote safety due to a smaller supply chain. He added that the current salad industry has seen issues with safety in the recent past.
“One farm’s contamination could have a bigger impact since more products are coming into contact with each other,” he said, stating that a longer supply chain makes tracking more difficult. “Those structural challenges don’t exist in our model as they do in the incumbent supply chain model.”
Creating new names and brands for products can help your CEA operation stand out in the marketplace. The year-round nature of indoor agriculture could also give CEA operations a leg up on labor.
Farm labor shortages, which he said have worsened due to the current administration’s policies on labor and immigration, have only been made more difficult by COVID-19. Housing and transportation have left farm employees more vulnerable to the disease.
“When this is over, borders will probably be less open, not more, so this issue will probably become worse,” he said.
“That’s what local means to me more than anything else — it’s local impact,” said Alex DiNovo, president and COO of DNO Produce. CEA operations are better equipped to control entry to facilities. And, year-round labor provides more stability in the workforce.
5. Retailers are looking for the right size solution for their stores.
Verlage said Walmart is looking for ways to mix big and smaller growers since different growers will bring solutions better suited to different communities.
“We are trying to figure out what is the right size project for the demand we face in different stores,” he said. “It has to be affordable, good nutritious food so that we can help everyone enjoy healthy food.”