Article

Startup aims to help restaurants clear hyperlocal produce hurdles

OtherShip Foods offers 10- and 20-foot containers that use hydroponics technology to grow produce on site.

November 13, 2014 by Alicia Kelso — Editor, QSRWeb.com

Locally sourced ingredients have topped restaurant industry trend lists for the past few years and consumer demand shows no sign of waning.

Much of what is actually offered locally, however, is dairy or meat. Produce is a bit trickier, with about 85 percent of all specialty produce grown in the US market coming from California. Only 50 percent of the domestically distributed produce, however, comes from the state, while the other 35 percent is exported. The other 50 percent of produce we consume arrives from Mexico (14 percent), South America (8 percent), Canada (5 percent), Central America (4 percent), and elsewhere in the US (10 percent) and world (8 percent).

This makes it hard for concepts to fully pitch the local angle for such offerings. It can also make things pricier and compromise quality and safety for operators.

One startup is trying to solve these problems with the creation of containers that can produce soil-free food. While very new – less than a year old – OtherShip Foods has already caught the attention of some chefs in the industry as well as educational institutions keeping an eye out for new food technologies.

Here's how it works: a high-tech shipping container filled with racks of growing produce can be parked steps away from a restaurant's kitchen door. Chefs harvest produce from the container as needed, and OtherShip staff pop in a couple of times a week to restock and check systems.

In its fledgling stage, OtherShip is having conversations with a variety of concepts in a number of industries and is trying to procure more financing to grow its fleet and model to meet the needs of each. In the restaurant industry, the company is especially focused on the fast casual segment.

Founders Starin McKeen and Jefferson Morris plan to charge a monthly fee at or below existing wholesale prices while simultaneously removing the middlemen – and thus some volatility – involved in supply chain distribution (trucking, packaging, etc.)

McKeen said the impetus behind OtherShip is to solve the challenges that come with produce procurement and sourcing locally, particularly in the context of scaling up.

"We are focused on growing the custom, finicky, specialty produce that many chefs now want and we can do it on site in the container," McKeen said.

McKeen and Morris (who designed the container) started out with food production, then added the technology component and are now solidifying the business model. Their pitch to restaurants is in riding that demand for local ingredients.

"We ask restaurants what their produce sourcing process is and if they're looking for specific items. Many of them have resorted to Sysco or other distributors and validate the problem that they want to do local but can't do much more than about 10 percent," McKeen said. "And that 10 percent is usually just at the peak of growing season."

In addition to having a low percentage of "local" offerings, the use of larger distributors poses other challenges with consistency, safety, reliability and freshness, according to McKeen.

"Especially in winter, there are generally a lot of quality problems and operators getting greens that are already wilting," she said. "We want to solve both the seasonality problem and the volatility."

OtherShip will start with microgreens, baby greens, green onions, leeks, tomatoes and herbs, before adding pepper variations, cucumbers, some fruit and more.

"We want to help restaurants go from 30 to 70 to 80 percent of their produce being local, and offer them much more variety than what current comparable technology can. We're also hoping to allow them to have more say in what they can order, in their ingredients," McKeen said. "A big point for us is to allow chefs to be the culinary artist and provide them with the ingredients to do so."

OtherShip will avoid root vegetables because, as McKeen describes, "it isn't a smooth process to grow them hydroponically."

The science of hydroponics is behind the container technology. The containers are also fully automated and push data – such as PH levels, lighting, inventory, etc. – into the cloud for management. The company also provides training for restaurant employees to learn know how to use the container – no actual growing, just harvesting and picking.

Operators who add a container will require a monthly lease. OtherShip maintains ownership and will service the containers between two and four times a week for checkup and restocking.

The ultimate goal, McKeen said, is to not only enable concepts to offer more local ingredients, but to also grow alongside those concepts.

"We can add containers as they add units," she said. "That has always been one of our goals is to solve the scalability problem that prevents many restaurants from serving local."