Azoti Nets Win-Win-Win for Local Food Supply Chain

1395

Since launching in 2011, Azoti has honed a two-step solution that’s yielding a win-win-win for hyper-local farmers, distributors and buyers. Efficiently opening up the lines of communication between the three players in the farm-to-table supply chain isn’t something that’s really been done before.

“Now we’re starting to prove it, but with larger and larger players,” says Azoti Founder & CEO Dave Ranallo.

During peak produce season, Azoti’s solution differentiates itself with transparent ordering and just-in-time inventory. With one ordering portal, a chef or food buyer can not only see warehoused product that’s available for next-day delivery (staple items customers generally always need), but also produce that is still in the farmers’ fields, ready for a 48-hour delivery turnaround.

With just-in-time delivery, “Nothing is picked until it’s ordered,” Ranallo says.

The order goes directly to the hyper-local farmer, which Azoti defines as a farm within about a two hour or 150 mile radius, who gets the fresh product to the distributor, then it’s on to the customer – all with the transparency of knowing exactly which farm the produce came from. Transparency-Ordering-infographic-high-res

“The more that we can get the chefs to order local product using the just-in-time process, it will reduce waste for those [distributors] and increase net profits,” Ranallo says.

The second step, demand and crop planning in the off season, creates more efficiencies in the Azoti system, and another opportunity to reduce food waste. Azoti takes a customer’s previous year’s usage reports, plus current run rates, and gives a chef or cafeteria a recommended demand plan or pre-order for season. That creates a documented commitment that builds accountability and trust with farmers. In turn for the accountability, farmers provide one price for the season.

When the season rolls around, food buyers can easily get their pledged product through Azoti’s three-click ordering system. Through text or email, the customer just has to review the delivery date and products, click submit, and their produce is on the way. Quantities are even pre-filled based on the demand plan.

Azoti has accumulated close to $500,000 in commitments for the upcoming season from a range of food buyers that highlight the diversity of the system. Individual restaurants, like J Alexander’s Redlands Grill at Crosswoods, to hotels, including the Hyatt Regency Columbus, and hospitals, including OhioHealth Marion, will source their produce through the Azoti supply chain in the upcoming season. JP Morgan Chase food service provider Aramark, Avita Health Systems, two major Cleveland-based health systems, as well as a small, private university in northern Ohio have also made commitments with Azoti.

Demand-Planning-Buyer-screen-high-resAzoti’s supply chain management is doing more than building transparency and communication, it’s tackling the issue of food waste and making “farm-to-table” easier to actually commit to.

Ranallo says about 40 percent of all food is wasted nationally. That waste is spread across the supply chain, from the farmers planting too much crop, to the individual that doesn’t eat all the produce they bought at the grocery store.

Distributors typically see a 15-25 percent loss, and, “In general, in the produce world, the farmers experience between 25-30 percent waste,” Ranallo says. “We’re affecting the food waste at the very beginning of the process.” 

Azoti tackles the food waste problem at the first two steps of the process. Farmers can replace ‘plant and pray’ with a more measured estimate of what needs planted, and know there are buyers for it. With just-in-time ordering, product isn’t sitting in a warehouse waiting to go bad, which in turn, Ranallo estimates, could increase a distributor’s net profits by 50 percent.

Many restaurants tout farm-to-table or claim to source as much locally as possible. The current supply chain is set up in a way that makes that good intention extremely time consuming to actually implement. Ranallo says a chef will often get their staple products from a larger distributor, then might have a lettuce guy, and a mushroom guy, and 13 other vendors. That’s 15 delivers; 15 invoices, “It’s too much,” Ranallo says.

There’s also no quicker way to upset a chef than miss an order and not communicate until it’s too late. It’s enough to keep a chef from going back to that vendor.

Centralizing hyper local farms of all sizes and growing techniques (Azoti’s lineup includes hydroponic growers, to 30 acre and 500 acre farms) at the distributor means one order, one delivery, one invoice – and a network to pull from in case one crop has an off week.

Azoti will also take its supply chain on the road, with commitments in Philadelphia, Detroit, San Antonio, Tampa Bay, Austin and Atlanta. 

For more information, visit azoti.com