Editor’s note: We kicked off our first annual Food Loves Tech event last summer in Chelsea—here’s a recap. We’re bringing a taste of the food and farming future back this year, but just across the East River at Industry City. This story is part of an ongoing series about technology’s effects on our food supply.
Currant-turmeric crisps, citrus-coffee soda, scarlet frills mustard: droves of products enter the New York City marketplace every year, each fighting for the attention of buyers at small businesses and restaurants.
Enthusiasm for new food brands reverberates through communities of investors and consumers alike but a substantial infrastructure gap remains. Despite the city’s growing local abundance of small food businesses and urban farms, they have very few distribution options. Established distributors don’t typically operate at such a small scale; they deal in pallets of spinach and supermarket chains, not cases of microgreens and a handful of local businesses.
“Tens of millions of dollars of venture capital is getting poured into growing produce in the city,” Tom Hallaran, founder of Foodshed says. “But all of these projects basically have to figure out their own distribution.”
Foodshed is a still-in-beta app that connects urban farmers with buyers at restaurants. The team is focusing on building software that streamlines the ordering process before tackling the nuts and bolts of delivery. Hallaran envisions a logistics infrastructure that accommodates aggregation since one of the challenges buyers seeking to purchase city-made food face is an inadequate supply. A single urban farm may not have the capacity to provide 50 pounds of kale every week for example, but several farms could contribute product to meet the demand.
Unlike in traditional distribution models where a supplier provides a massive amount of product that gets broken into smaller units throughout the supply chain, Foodshed is strategizing an approach to delivery where building up and breaking up bulk is part of a single process. “It might look a little bit more like ordering food from Seamless,” says Hallaran, “where delivery and pick of inventory look the same.”The distribution problem for food entrepreneurs came as no surprise to the founders of FoodWorks, a culinary incubator with kitchens in Brooklyn and Rhode Island with plans to expand nationwide. Moving into distribution has been part of the plan since the beginning according to director of distribution Chris Wren. “Our mission is basically to be able to empower anyone to be able to start their own food business,” he says. “Our distribution model is a step in that direction.”
In early September FoodWorks distribution started making deliveries and its first catalog includes 50 brands (many of which produce in its Brooklyn space) and they have working relationships with about 35 retailers.
Phoebe Connell and Nora O’Malley, the duo behind Alphabet City wine-on-tap bar Lois, became members of FoodWorks in early spring to scale up their line packaged goods line Aida Eats. “When you go through a distributor, especially a big distributor, you just end up sitting in their book,” Connell says when asked about distribution. “They don’t know anything about you, especially when you’re so small, they don’t really care. With FoodWorks, I see Chris every day, he knows my process; he knows what we’re about, he knows my brand.”
This model absorbs risk on both ends of the supply chain: by purchasing goods from the producer in regular and manageable quantities, it helps guarantee sales. FoodWorks is also the only distributor for their products like spicy granola and lime leaf sambaal. Wren predicts this will help his clients at small businesses who struggle to compete with the price breaks supermarket chains offer on widely available specialty foods. “Small businesses want to support local,” Wren says, “but more than anything a small business wants a differentiated product mix from their competitors. We’re looking for those crazy things that most distributors wouldn’t touch.”