Whole Foods' Former Co-CEO Becomes A FoodMaven
Phil Lempert, Contributor, Forbes
Jan 3, 2018
Walter Robb, Whole Foods’ former co-CEO has joined up with Patrick Bultema who is CEO and co-founded Colorado Springs food start up FoodMaven to do something about the growing food waste problem in the U.S.; they want to sell it.
Robb, needless to say, brings a lot of experience and knowledge about food to the company. He has joined FoodMaven’s board and is what Bultema names as a “major investor.” In addition to his retail experience and investment, Robb also brings decades of foodservice experience from Whole Foods’ prepared foods and Grocerant offerings, which if reported separately by it would make Whole Foods one of the nation’s largest foodservice operators, according to one Whole Foods buyer who participated in a public retailer roundtable at the Fancy Food Show in June of 2017. His expertise will come in handy as FoodMaven wants the industry to reclaim about $200 billion of what they both told me in a phone interview last month is “perfectly good foods that are lost to an inefficient 1950s style food system” and sell it at a 50% discount to restaurants and other foodservice operators. They say that suppliers receive revenue that otherwise would be lost (they receive about 25% of the foods’ normal value) and restaurants can lift their profits; especially important as operators face tighter margins on the way with the January 2018 increases in minimum wage rates in 18 states and 20 cities and counties, including New York, California and Colorado. FoodMaven’s cut is, according to the company, “on a blended average about 50% of the sale” making this venture one with huge potential.
To put the potential revenue opportunity in perspective, today food is a $1.2 trillion market and, according to the Natural Resources Defense Council, up to 40% is wasted; which equates to about $480 billion. FoodMaven says almost half of that is high quality and merely over-supplied – somewhere over $200 billion in high-quality first-rate foods that are being discarded. The examples they cite include retailers and distributors that may have ordered medium sized potatoes and received large ones instead, or chickens that were delivered and found to be lighter in weight. Foods that are just “ugly” that traditional retailers don’t want to put on their shelves. Fresh foods from companies that have a limited shelf life and had orders placed by retailers that were cancelled. Bultema and Robb also point out that smaller local suppliers in particular have a difficult time getting into the mainstream food system, which has attracted those producers to sell their goods directly on FoodMaven and bypass traditional distributors. Any food that is unsold by FoodMaven is donated to food banks and hunger relief groups.
The company’s strategy...