The entrepreneurs turning their business savvy to food waste

As much as 40% of the food in the US is not consumed, according to a report from the National Resources Defense Council (NRDC). Much of it ends up in landfills as waste. In other words, Americans throw out about $165bn each year.

"That amount of money has to whet the appetite of a lot of creative entrepreneurs out there," says Elise Golan, the director for sustainable development in the Office of the Chief Economist at the US Department of Agriculture.

Indeed it has. And these entrepreneurs get that the problem is the same one that's vexed human communities since ancient Rome shipped Egyptian wheat to feed hungry masses. "A lot of it is a logistical problem," says Golan. "The new innovation is around logistics and information technology – how to efficiently create those networks of how you can get from point A to B more easily."

Entrepreneurs are coming in at every stage of the food cycle – when produce is sitting at the farm without a buyer, when it's at the store but doesn't meet the standards for getting past the door, when it's in the store but about to go bad, and even when it's in the consumer's refrigerator.

FoodStar Partners

Stuart Rudick is one of them. His start-up, FoodStar Partners, is a year old and already profitable. Founded with two food industry veterans, Bill Shepard and Ron Clark, they had the "very lofty goal of solving the entire supply chain problem," Rudick says, but soon decided to start with fruits and vegetables.

It partners with farmers and retailers to bring excess product into supermarkets and sells them under the FoodStar brand at discounted prices. They sell a limited amount for a limited time.

FoodStar works with the store to analyse the ordering and distribution process and helps to decide what products to bring out and when. Rudick gives the example of a store that has 20 boxes of cucumbers and needs to get rid of them quickly. "They've got two to three days of shelf life. We'll say it's a flash sale and notify consumers through text messages and emails. The cucumbers will be 60% off normal price. The sale will last for an hour or two, and it'll be done and sold."

FoodStar has partnered with Andronico's, a grocery chain in northern California, and hopes to be in stores across the country in a few years, expanding from produce to bakery to prepared foods, and even dairy products.

Daily Table

Few know more than Doug Rauch about scaling and expanding grocery store chains. As former president of Trader Joe's, Rauch has been in the industry for more than three decades and is credited with growing the Monrovia California-based speciality grocery store into a national powerhouse.

This autumn, he's opening the Daily Table in Boston, where he will sell meals and basic groceries at discounted prices. Staff will recover groceries that haven't been consumed and are about to be thrown away at supermarkets and food services. A trained chef will use them to cook grab-and-go meals designed by a nutrition task force. "It would be economically agnostic for this food insecure family", says Rauch. "They could go out and get healthy delicious food for no more than what they're spending on junk food."

He's going to dig into the 40% grown that is never consumed. "That product, for the most part, is wholesome, healthy food," he says. Think of the product that is too big for the bags it's supposed to go in, blemished, or close to the 'best by' date, a concept he says, citing a study by the NDRC, has added to the confusion around food consumption.

Rauch has funded part of his project, and has raised money from foundations and companies such as the Robert Wood Johnson Foundation, New Balance Athletic Shoe Inc, the Kendall Foundation, and others. He's spent $3m building out the kitchen, commissary and the bricks-and-mortar store. The Daily Table is a non-profit, but will not give away anything for free. The goal is to make it self-sustaining. The first store is a pilot store, but Rauch plans to take the Daily Table to other cities.

BluApple

Even if a food item makes it into a consumer's refrigerator, there's no guarantee it will be eaten. That's where BluApple comes in. The blue apple-shaped contraption extends the life of fruits and vegetables, explains Timmy Chou, president and CEO of the five-year-old company. "When produce is cheap, nobody cares. But produce is not cheap today," he says.

The BluApple story began when he noticed that the food industry used a certain technology to prevent the buildup of ethylene gas in warehouses and during shipping. He realised that this technology had consumer applications and invented the BluApple with Eric Johnson. The BluApple uses sodium permanganate to absorb ethylene gas, which acts as a ripening agent, and is naturally given off by fruits and vegetables.

It wasn't easy to get retailers on board, Chou says. "We had a bit of obstacle to overcome to position ourselves as credible." But Chou and Johnson distributed free BluApples, brought out information about the technology used, and built a repository of positive online reviews. The company broke even in 2010 and had sales of more than $3m in 2013-14, says Chou. It is now expanding in Europe and Asia.

Food Cowboy

Extending a vegetable's shelf life can save money, but what happens when produce that's ready to be eaten can't find shelf space in a store? When a distributor would reject the produce on Richard Gordon's truck, he wouldn't head to the closest bin. He would try to find a food bank or charity who could use it. That meant calling his brother to locate an organisation close to where he was. The brothers saw that other truckers were interested in doing the same and came up with Food Cowboy, which launched in 2012. Truckers enter what they've got to donate and where they are on Food Cowboy's website. Food Cowboy reaches out to food banks in their vicinity. If someone wants the load, they call the trucker.

Food Cowboy diverts about 300,000lbs of food a quarter and charges $0.10 a pound. The co-founder and vice president, Barbara Cohen, says the challenge is in getting people used to doing things a different way. "It's easiest to find a dumpster," she says.

"[Food waste] is a small but booming space to be in," says Dana Gunders, a staff scientist at NRDC. She says the amount of food that gets wasted has increased by 50% in the last 40 years. Fortunately start-ups, waste companies, governments, foundations and groups that care about climate change are getting involved. "Is enough being done? The trajectory over the last two years gives me hope," says Gunders. "But I wouldn't say we're there yet."

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