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FoodLoop Helps Shoppers, Retailers Work Together to Eliminate Grocery Waste
May 13, 2014
In the weeks leading up to the Sustainable Brands Innovation Open (SBIO) finals on June 4th, where the runner-up will be decided via live online public vote, we will get to know our 11 semi-finalists. Today, meet FoodLoop.
Food waste has emerged front and center as a key sustainability challenge, with potential solutions seeming to emerge daily from startups, retailers, trade groups and NGOs around the world. Now, a German startup has created an app called FoodLoop, which aims to tackle supermarket food before it becomes waste.
What is FoodLoop?
FoodLoop offers the Food Retail Industry (FRI) the first platform to promote discounted "best before date" (bbd) on-sale deals in real time, directly to user's smartphones. Our aim is to significantly reduce waste, increase revenue for grocery retailers, provide cheaper groceries for consumers, and most importantly, promote and encourage a more sustainable retail industry. FoodLoop stands for sustainable rethinking, a positive more eco-friendly change in consumer behavior, and adds social value by donating part of its revenue to charities.
Tell us about FoodLoop's journey so far.
CEO and founder Christoph Müller-Dechent came up with the idea for FoodLoop in October 2012, due to his personal experience at a supermarket, [when] he was unable to find any eggs, milk or yogurt that was closer than seven days to their bbd. After inquiring further, he was shocked when he was told that everything "just" gets thrown away. He used this as inspiration for a Strategy and Venture Seminar, and the idea of FoodLoop was born.
FoodLoop was part of the Business Plan Competition of the NUK 2012/13 (New Entrepreneurship Cologne Rhineland) and was selected as a finalist in each of the three entry levels. In April 2013, FoodLoop got affiliated as part of the "startup focus program" conducted by SAP and won a grant for $1,000. In the following months, FoodLoop won several national and international competitions including the first prize at the FI-WARE challenge in Sao Paulo, Brazil for €75.000.
After starting to develop the app at the end of March 2014, FoodLoop is concentrating on the pilot project with three bio supermarkets in Bonn. This project will start at the end of May and will last for three months [during which] we will try to measure the success and the impact of our app.
How is FoodLoop funded? Have you received any institutional support from other organizations or the government?
The startup incubator at Cologne University provides FoodLoop office premises until March 2015. The scholarship is providing a total of €23.000 for company-specific matters (for developers, hardware advice, measurement, travel of acquisition) from April 2014. In addition, it also includes the salaries of the three founders for the period of one year with three salaries of €2.000 per month. Overall, this is a grant in the amount of €89.000.
Besides this scholarship, FoodLoop was successful at several startup competitions as mentioned above. Thanks to these, FoodLoop could collect another €87.000 in total.
Tell us more about your partnership with SAP.
In March 2013, FoodLoop became a member of the "startup focus program" conducted by SAP, and won a grant for $1.000 for the virtual Silicon Valley incubator "1 million by 1 million" (since June 2013). Through that relationship we got free SAP hana developing licenses to create a FoodLoop back-end prototype on the hana stack, Amazon Web Services Credit and development support. Here SAP signed a 3-year mNDA that they would support us with development resources and market-enable us once the prototype has reached the state of a proof of market
In February 2014, FoodLoop became part of the SAP social impact lab, which gave us free office spaces in Hamburg for nine months, an additional mentor from SAP and free SAP Retail business suite training in the SAP Hamburg training center. Also in February, FoodLoop won the smart business and industry challenge of FI-Ware, of which SAP is an associated private sponsor. Through this affiliation, FoodLoop was granted an SAP Retail Business Suite license to integrate the FoodLoop backend functions with SAP Retail, meaning that in the near future the FoodLoop Button and UI might be available in SAP software, which is the main goal of that strategic partnership for FoodLoop.
Do you think people's biases towards 'stale' food will be a hurdle? If yes, how does FoodLoop plan to address it?
We did consider this hurdle and communicate the explicit difference between the terminologies ‘bbd,’ ‘expiry date,’ ‘use by’ and ‘best by.’ In Germany, consumers are already aware of the differentiation. FoodLoop's bargains are also titled 'freshness discount;' by use of this terminology, the consumer is reminded with every purchase, that the freshest products are on sale and that FoodLoop is always associated with fresh, fully edible products. This procedure has shown to be successful by several major supermarket chains, discounting fresh products with so-called freshness discount labels.
How does your app compare with others with similar missions, such as End Grocery Waste?
The existing and potential comparable services to FoodLoop, besides Cropmobster, are Zero-Gachis (ZG) and End Grocery Waste (EGW). These are not similar to FoodLoop services even though they follow the same mission of reducing food waste - the service that FoodLoop provides is the first of its kind in the world. ZG is not connected to the ERP or the cashiers, which means it has no accurate real-time stock information and employees have to re-label and move the food to the designated shelves manually. EGW is just a best-practice blog, asking retailers to take initiative and advantage of the bbd-Features in the GS1 DataBar. EGW is therefore not a business.
What do you think of the Daily Table as a retail concept?
We really appreciate and support the idea of the Daily Table. We’ve been in contact with the people in charge of the Daily Table of Cologne and presented our idea. They didn’t see any problems in our business project competing with them. To further support social institutions like the Daily Table we will be implementing a bonus system that enables the customer to donate money to social institutions.
What are the next steps for FoodLoop?
The app is nearing finalization and will be available at the end of May. The next big step will be the upcoming pilot project with Bergfelds Bio supermarkets in Bonn. Afterwards we will review the results of the pilot projects and improve our app where necessary. At the end of this year we are planning a series of funding projects and looking for a serious partnership with a big supermarket chain.
We’ve been in contact with the five largest supermarket chains in Germany — Aldi, Edeka, Metro, Lidl and Rewe. They all show a high level of interest in our business idea and after our pilot project with Bergfelds Bio supermarket in May begins, more meetings will follow.
What are your hopes for being an SBIO semi-finalist this year?