We are barely aware of what we eat.
When you order a dish, it could be made up of maybe twenty base ingredients. The chicken might have come from France from a free range farm. The potatoes might have been grown in Kent. The turmeric might have grown first in Vietnam to be subsequently transported to Malaysia, ground into powder, to end up in a UK supermarket. The wine first grew as grapes in Argentina four years ago. The olive oil used to panfry the chicken was packaged as Italian – but the olives are originally from Northern Greece, and manufactured in Sicily.
Every mouthful comes from all over the world.
Complex global supply chains render the entire system effective, but opaque.
I was set to interview Jeremy Hibbert-Garibaldi, the founder of COLLECTIVfood. His vision is to change food supply forever – and to pioneer radical transparency in the way restaurants, catering services and hotels get their produce. As a chef or food buyer, you can select your farm based on their profile, message them directly, and if you like, visit them, and shake their hand.
And COLLECTIVfood is doing well. ‘We grew from myself to a team of about 15 people,’ explained Jeremy. ‘We grew from zero business to now about 1,000 farms in the U.K. and across Europe and even further. We’re now delivering tens of tons of fresh products every week to about 90 restaurants [in] London, including great chains of high street outlets and restaurants like Crussh and Big Easy. We’re starting to enter new verticals, like retails, street food stalls, and hotels. Basically, we can help any business that needs core ingredients.’
‘We’re working on three components: our digitalised marketplace, connecting farms to professional kitchens; our distribution model, bringing food to kitchens in a leaner and smarter way; and our additional services, such as upfront payment for producers and credit insurance mechanisms.’
The Online Farmer’s Market
I asked Jeremy to give me the 101 about produce supply today.
‘The way that the supply chain is structured,’ explained Jeremy, ‘is big wholesalers and distributors. You need to think of 50 years ago, there was no internet, so these guys would be intermediaries – in charge of actually sourcing products. They would buy the products on the farms… and then try to sell it to customers.’
These companies own the market today. ‘They basically have an inventory-based business model where they buy huge amounts of product from the farms, and [have] salespeople fighting to sell the products to customers.’
The problem isn’t just that it’s opaque – but that it treats food as a commodity. From the buyer’s perspective, ‘you know you’re going to get your products, but you have no idea how the prices have been built, no idea exactly where the products are coming from. You’re just getting a chicken price.’
In the COLLECTIVfood app you can browse multiple farmer profiles and source your chickens directly. ‘It’s fully digitised’ explained Jeremy. They connect ‘great farmers, passionate people – with chefs and professional kitchens.’
Still, Jeremy was surprised at the way farmers began to communicate through the platform.
‘It’s funny – we didn’t think about [marketing] when we initially started the project and we quickly realised that it’s actually now a key USP for producers. They see their brand in front of customers, and they’re really eager to actually get feedback on their products. Sometimes we ask them for marketing materials to display at trade events and they’re super excited about it. We had some customers visiting farms or their processing plants.’
‘That’s a great dynamic. It’s a human business, right? People are proud of what they do… I think they love the fact that they can finally talk directly with people using their products. That’s great.’
I was surprised, too. On the one hand, it made sense; but on the other, lots of digital marketplaces don’t encourage branding. Amazon marketplace, for example, drives down margins for individual contributors by making the competition process slick, and enabling the user to sort by price. I asked Jeremy how price sensitivities worked in his market.
‘Our vision is providing a fair marketplace,’ said Jeremy. ‘As of today, there’s very little transparency. Nobody is able to know what the competition is doing in terms of price. We, on the other hand, have a live bidding process, and it’s like, if you’re happy to offer this price, great.’
‘It will be about the same, except that they’re getting the benefit of setting their own prices directly with the buyer and getting paid upfront by us, which is more fair.’
“Upfront” means at least 60 days earlier than farmers get paid under the current model, by the way – warehouses routinely hold onto the money until they’ve sold a farmer’s stock. Wholesalers operate by inventory and they stock huge amounts of ingredients, which might get sold or might not. COLLECTIVfood instead operates on a deal-by-deal basis which means that only food that has been actually ordered enters the supply chain.’
I asked whether COLLECTIVfood was the premium option for restaurants.
‘Not necessarily. In fact, we want to capture all the market,’ said Jeremy. ‘Casual dining is probably mainly margin-driven, it’s about prices first. What we’ve realised is just with our marketplace and just sourcing directly and eliminating a number of intermediaries, we are already able to offer better prices and great savings to kitchens. So that’s the great incentive for buyers.’
From A to B
How had Jeremy’s views on the industry changed since starting the business?
‘I think one of the key things is that when we initially started the business, we were really focusing more on the pure marketplace. We were working on offering a digital platform for interactions and introductions but we quickly realised that that wasn’t enough. That’s where the vision took another dimension about actually building our own distribution model.’
The distribution is more traditional than the app, as far as I could tell – it features lorries and warehouses.
‘There’s two things [which make us different]’ countered Jeremy. ‘There is one thing I can talk about – which is the use of tech. All these types of capital intensive and old school transportation companies don’t use any tech to make smarter decisions.’
‘The second part is we’re building a new distribution model which doesn’t rely on a fleet of trucks, but I can’t tell you more about it.’
‘We’re going to remove trucks from the streets,’ he added, mysteriously. This, he would say later, was part of a desire to be sustainable – reducing pollution by reducing truck use. ‘We want to be really innovative… how can we bring orders closer to our customers, inside the city, and more sustainably?’
Working with an extensive network of vetted British farms will prove beneficial in many ways.
Brexit will hurt, won’t it? I asked.
He laughed. And after a second, he said. ‘Yeah, yeah. True.’
It was a short answer. I had assumed he might have strong opinions. I asked him if he covered all of Europe, and he said he did, yes.
‘Is the international stuff challenging?’ I asked. ‘Or not difficult?’
‘We’re trying to be optimistic,’ said Jeremy. ‘if Brexit happens without any deal on food products, I guess local [farmers] would be as impacted as in other countries. MostBritish producers export 40% of their production.’
‘So they would be struggling in exactly the same way as European parties. They would have in-excess distribution capacity. Our remediation plan is that we can easily switch some of our customers to British producers who should have a lot of products to actually sell before they go to waste, so it should be fine.’
That seemed smart – but only part of a solution. Britain and Continental Europe don’t always produce exactly the same kinds of food. Where there’s no overlap, you can’t simply trade one for the other. ‘We’re trying to be optimistic because that would be a nightmare for everyone,’ clarified Jeremy.
One of the best things about a platform business model is the ability to keep putting more services there. Once you have a strong relationship with two groups of people, you can suggest more services to them and deepen the relationship.
Sure enough, ‘the last component [of COLLECTIVfood] is additional services’ said Jeremy. ‘All the services which we’re bringing to facilitate transactions between chefs and farmers.’
I asked for an example. ‘Financing and credit insurance’ said Jeremy. ‘Most foodtech companies have been focusing more on specific features, for example how do you manage orders with your existing suppliers. We’re bringing some tech, of course, how to facilitate interactions but we are fundamentally changing the supply chain.’
The ethical purpose of the company doesn’t stop there. Jeremy explained that they worked to ‘supply producers with alternative [packaging] solutions, which could be plant-based. We want to help reduce plastic use and offer good alternatives to those restaurants who serve environmentally focused customers. .’
‘I think there’s a trend which is probably pushed by end consumers like us, going to restaurants and other locations where we want to know where our food is coming from and how it’s been produced.
‘People are more conscious about how food should be produced. So I think all these operators and kitchens are being pressured by this, “More and more chefs and food buyers are now thinking: I need to find alternatives. I need to understand where my food is coming from.’
But if it continues to treat farmers fairly, the best thing about COLLECTIVfood isn’t that consumers understand their food better – it’s that farmers can see the fruits of their labour.
‘We brought one of our farmers to a casual-dining rotisserie restaurant to which they supply free-range chickens. They absolutely loved it, seeing their products on the plate. It was great, just to see their smiles, which is cool and makes it all worth the effort.’
If you’re a restaurateur, and want a free consultation on your EPOS software, call us on 020 3874 1470.
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