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Instacart raises bar on home delivery

Like many new companies in this era of technology, the needs of the owners led to the launching of Instacart, an online grocery shopping and delivery service.

“It was a problem that we personally had that we wanted to solve,” said Max Mullen, a co-owner of Instacart. “We wanted to get high-quality groceries and have them delivered quickly, and nobody was doing that.”

He and a couple of partners launched Instacart in July 2012 in the San Francisco market and since then have expanded it to 12 metropolitan centers across the United States. Mullen said five new metropolitan areas will be opened by the end of 2014 and he expects exponential growth in 2015, with most major population centers being served by the end of next year.

Mullen said other online grocery companies have not survived for various reasons that Instacart has been designed to avoid. For example, he remembers the famous flameout of Webvan, which was also launched in the San Francisco Bay area, and said that company was “extremely costly to run from an infrastructure perspective. And it was over-leveraged.”

Webvan could not support that infrastructure as it searched for customers and it died a spectacular death.

Personal-ShoppersPersonal shoppers on their way to delivering an order. Produce is included in 95 percent of all orders and makes up about 35-40 percent of total orders.Instacart has a simple model built on partnering with existing retail grocery stores and offering very fast delivery. Using the company’s technologically advanced software either on a computer or a smart phone, a customer can order groceries, including fresh produce, and often receive that order within an hour. In fact, if certain geographic criteria are met when the order is placed, Instacart guarantees the delivery within an hour.

Mullen said the company is targeting busy moms as well as urban professionals. He said both groups are challenged for time and appreciate having their high-quality groceries delivered the same day they order them. It is the speed of delivery that he believes will help Instacart survive as giants such as amazon.com and Google enter the home delivery grocery space.

Instacart can make good on its delivery guarantees because it has shoppers in stores throughout the metropolitan area waiting for orders to appear via their own smart phones. Instacart partners with specific independent retailers and chains in each market area. Often the personal shopper is already working on another order when the new order is placed. The items are bought via a previously established account and delivered quickly.

Mullen said the delivery can happen so quickly that a mom making a meal and missing an ingredient can place the order and have it delivered while still making that dish.

For orders under a $35 ring, the delivery charge is $5.99, while for orders above that threshold the charge drops to $3.99 per order. In addition, most customers tip the delivery person.

Mullen said the model works financially for several reasons.

First, the retailers that are involved share the cost of the service. The benefit to that store is that it often gets access to new customers.

For example, in San Francisco, Rainbow Grocery is a very popular independent grocery co-op, but its single location makes it difficult for consumers who live several miles away to frequent the place. With Instacart, they now have access to the high-quality produce and other items for which the retailer is noted.

Mullen said that as Instacart moves into a new metropolitan area it partners with popular retailers with high-quality products that many consumers want access to. This gives the service instant credibility and instant access to customers.

Other retailers that are currently serviced by Instacart include Whole Foods, Costco, Kroger and many smaller chains throughout the country. As it opens new markets, Mullen said its rate of growth in each market is increasingly faster.

Many items on the Instacart website are sold to the consumer at the exact same price that is available in the store, but Mullen said some retailers do adjust their pricing both up and down. They might charge more for some items and make others available at a lower cost as a special promotion for online shoppers.

When Mullen and his partners launched Instacart, they thought fresh produce, like other items in the store, would be on the average consumer’s shopping list, but Mullen said its popularity has been a bit surprising.

“Produce is on 95 percent of our orders and makes up about 35-40 percent of the total orders,” he said.

The company does train its shoppers on picking top-quality produce, including such intricacies as how soon an avocado will be ripe. Mullen said customers do have the option to buy produce in various stages of ripeness so the personal shoppers need to be able to accommodate those requests.

“It is our biggest selling category, so we need to get it right,” he said.

He said the training module includes written material, an online video and in-person training.

The top sellers in the produce department for Instacart mirror the top sellers for any brick-and-mortar store. Bananas are No. 1, with other top-10 categories being berries, packaged salads, avocados, citrus, onions and grapes. Overall, fresh fruit is a better seller than fresh vegetables.

The company’s personal shoppers are typically students or stay-at-home moms looking for extra income. Shoppers are paid based on their number of deliveries in a given time frame, so a quicker shopper can make more money. While many are part-time, Mullen said there are some who do it all day long as their main source of income.

When the company first launched, Mullen said the initial users were from higher-income levels, but the low cost of delivery and access to the same price in the stores has created customers from every price range. What they have most in common is lack of time.

In each metropolitan area that it enters, Instacart maps its service area carefully so that the customers can be reached efficiently and quickly.

For example while the East Bay in the San Francisco area is covered by Instacart, my community on the east side of the Oakland/Berkeley Hills area does not yet have coverage, though Mullen said it should open up soon.

The current markets that are covered by Instacart are Atlanta, Austin, Boston, Chicago, Denver, Los Angeles, New York, Philadelphia, San Francisco Bay area, San Jose, Seattle and Washington, DC.

 

Riveridge continues 2013 automated vacuum harvester test

This fall Riveridge Produce Marketing, Inc., based in Sparta, MI, will continue a successful vacuum apple harvester test launched in the 2103 season.

An Aug. 21 company press release indicated that the pilot test last season ran for six-weeks. This showed “significant promise in several areas… and the company has plans to expand its use of the equipment again this fall.”

“Basically what we wanted to see last year was how well the vacuum harvest machinery handled the fruit from the picker into bin-filler, as the first test of whether the system was a viable option for us,” said Justin Finkler, Riveridge operations manager.  “We were very pleased with the results of the bruising trials.”

2014-8-22-vacuum-harvesterRiveridge Produce Marketing is continuing experimental tests on this apple harvester after highly successful pilot program in 2013. (Photo courtesy of Riveridge Produce Marketing, Inc.) The press release noted that Riveridge, a vertically-integrated grower/packer/shipper, worked with researchers from Michigan State University to evaluate the quality of hand-picked apples compared to apples picked and fed into the vacuum harvesting tube.

The apple harvesting system, manufactured by Phil Brown Welding, Inc., of Conklin, MI, has three key components.  The first is a picking platform that carries four workers on a hydraulic platform that’s raised and lowered as needed, with two workers on each side of the platform.  It was self-propelled by a driverless tractor.

The second component is the vacuum harvesting equipment itself, which resembles the traditional sash-supported pails used by professional harvesters, except that the bottom of the “pail” is a fully-padded vacuum hose that continually, gently conveys the apples into a bin.  Consequently, apples are still picked by hand, but conveyed by the vacuum equipment.

A third component of the system lowers the filled bin of apples into the aisle, where a box hauler removes it from the orchard, and replaces it with an empty bin located at the bottom end of the workers’ vacuum tubes.  A fifth worker monitors these processes.

Riveridge’s test of the vacuum harvester found significant benefits in several areas:

* Improved worker efficiency, by not moving ladders and walking to the bin;

* Ergonomic benefits and improved safety for workers;

* Improved worker productivity and quality by reducing physical fatigue;

* 24-hour harvesting capability under LED lighting; and

* Reduced bruising of the apples.

According to Riveridge’s President, Don Armock, “While we plan additional tests this year, we believe the vacuum harvesting aid has potential to help address our labor issues and bring better quality fruit to harvest.

“We did side-by-side trials with people on ladders, harvesting the same blocks containing the same varieties on the same day.  We wanted a true apples-to-apples comparison of hand-picked fruit to machine-picked fruit,” Armock said.

Perhaps Riveridge’s most significant finding in 2013 was that the vacuum harvester handled the apples better than some of its best workers did.  While it was used on only about five percent of Riveridge’s land, data showed that bruising was less frequent when the vacuum aid was used, Armock said in the press release.

“We believe that our future includes harvest-assist machinery, quite possibly this system,” Armock said.  “Following some upgrades made over the winter, our team is eager to put the machinery to use again with another big crop.”

During the pilot test, conventional harvesters picked fruit from the ground as high up as they could reach.  The four workers on the vacuum harvesting platform picked the tops of the trees.

“Anytime you can take the ladder out of the equation it’s better on bruising, faster for the workers and better on safety,” Finkler said.  “In some of the trials we tried to use the vacuum harvester to do it all.  But the worker on the ground is hard to beat for efficiency.

“Having our hand-harvesting crew pick only what they could reach, and letting the machine pick the rest, probably increased the speed of our ground crew 15 to 20 percent,” Finkler said.  “It was a trial and we learned as we went.”

“Adequate labor in the orchard at harvest continues to be a challenge for us and most other apple growers,” Armock said.  “This kind of harvest aid allows us to more fully use our labor pool.  The less physical nature of using the vacuum-harvester to pick apples also means we’re more likely to be able to recruit domestic laborers.”

“We believe new technology and better working conditions, such as those enabled by harvest aid systems, will help us further become the employer of choice to attract the best workers in our area,” Armock concluded.

The vacuum harvester and accompanying automated picking platform are currently one-of-a-kind.  They were invented, patented and fine-tuned over the last several years by Phil Brown Welding, Inc., at the direction of the “DBR team” of apple grower Chuck Dietrich, machinist Phil Brown, and grower Mike Rasch.

With another 32 million bushel crop on the trees, Riveridge plans to test the efficiency of the vacuum harvester again this year.

Over the winter, DBR modified the equipment to speed up efficiency and allow better maneuvering in the orchard by removing tractor and adopting a self-propelled platform.

These changes plus last year’s experience allows Riveridge to begin paying workers the more customary piece rate rather than hourly wages, Finkler said. 

The vacuum-harvest aid requires trees that have been planted and trained to about 12 feet tall in a two-plane system.  Most Michigan orchards planted in the last decade have been trained to these newer spindle or axis systems.

Michigan is the nation’s third-largest apple producing state, and nearly 60 percent of the state’s apples are grown on or near Fruit Ridge, which runs through Kent, Muskegon and Ottawa counties.  Riveridge Produce, Inc., sells more than one-third of Michigan’s fresh apple crop in up to 26 states and a dozen foreign countries.  The company is 25 years old this fall.

National Mango Board encourages 'Ripe and Ready to Eat' mango program

The National Mango Board is moving forward with its Ripe and Ready to Eat mango program — a program aimed to provide U.S. consumers with a quality fruit that is ripe and ready to eat by the time of purchase. The NMB has done extensive research that shows that ripe fruit has higher acceptance rates within consumers.

The RRTEMP gives mangos a marketing advantage, eliminating the obstacle of consumers purchasing fruit short of its desired ripeness level, thus providing high-quality fruit. To identify a high-quality eating mango, the NMB has developed minimum maturity indices, proper fruit ripening protocols and fruit sensory descriptions to attract and satisfy consumers. Proper mango temperature management is one of the most important elements in order to have a quality ripe fruit that is ready for consumers to enjoy.

“Appropriate temperature management is an important component to improve consumers’ mango eating experience and knowing the opportunities of improvement is beneficial to the industry. Consumers continue to tell us they do not know when a mango is ripe,” said NMB Executive Director William Watson. “Our mango ripening program is designed to provide tools for the industry to consider if they want to develop their own ripening system. We have seen considerable growth of many other commodities that have been packed and shipped through a ripening program. There is still much more research to do but feel we are on the right path.”

After extensive research, the NMB in conjunction with the University of California Davis (Department of Plant Science), the University of Florida (IFAS Center for Food and Distribution and Retailing), Universidad del Valle in Guatemala and INIFAP in Mexico, developed a Mango Handling and Ripening Protocol. The Mango Handling and Ripening Protocol is designed to help improve mango handling practices in the United States, leading to better quality mangos, greater consumer acceptance and higher mango sales. Topics covered in the protocol include: Mango Maturity and Ripeness, Mango Temperature Management, Mango Storage and Transportation, and Mango Handling and Merchandising at the Store.

The NMB hosted a Mango Ripening Webinar on August 20, that expanded in detail each of the topics covered on the Mango Handling and Ripening Protocol. Speakers included Dennis Kihlstadius from Produce Technical Services and Wendy McManus, retail program manager at the NMB. During the webinar, the experts provided best practices and recommendations for stores and distribution centers that included improving temperature management at all distribution levels during transportation and storage, as well as mango displays at store level.

For more information on mango handling best practices, visit mango.org/retail/best-practices.

For a copy of the mango Handling and Ripening Protocol, visit mango.org/industry/production-and-post-harvest-practices.

The Mango Ripening Webinar is also available to view at mango.org/retail/best-practices.

                               

 

Kragie: Orderly marketing will ensure retail, consumer satisfaction with kiwifruit

Chris Kragie, vice president of Western Fresh Marketing Services Inc. in Madera, CA, is urging California kiwifruit growers to hold off on their harvests until the fruit reaches a soluble solids content of 7.0, thereby ensuring the best product quality for retailers and a good eating experience for consumers. Conditions, he went on to say, should be optimal for California kiwifruit toward the end of September.

Kragie urges retailers to continue moving imported fruit at this time from sources they trust. “To ensure fruit quality and consumer acceptance, we believe in orderly marketing as the best strategy,” he told The Produce News. “We feel you should stay with the fruit from any country that will give this commodity a great tasting fruit and, in turn, will ensure trust and repeat business from the consumer.

01-Kiwi-WesternFresh-Chris-Chris Kragie, vice president of Western Fresh Marketing Services Inc. in Madera, CA“When the industry is buying kiwi from any country, they should ask if this fruit was picked and packed under proper conditions and not forced to ripen by gas before the fruit has reached high enough sugar content to ensure consumer acceptance,” he continued. “If not, the fruit will never ripen, meet a level of sugars that will ensure good taste, and overall will shrivel. Our opinion on gassing fruit is the sugars aren’t high enough to gas until late September, but we feel it best to wait until mid-October.”

Global kiwifruit dynamics are complicated, and the industry is currently facing a host of supply-side challenges. “There is such a shortage of kiwi worldwide,” Kragie stated.

Western Fresh has a branch office in Santiago, Chile and imports kiwifruit from mid-March through mid-September. “We had a major freeze in Chile,” Kragie commented. Data, he stated, reveal that overall kiwi shipments from Chile to the United States are down 65 percent.

The quality of product being imported by Western Fresh from Chile is good and holding well in storage. According to Kragie, in normal production years, the rejection rate on arrival is typically 5 to 7 percent. “This year, it’s been 2 percent,” he noted.

In addition to the freeze, vines in Chile were also attacked by Psa, a pathogenic bacterium. While growers have replanted vines, Kragie said it will take two to three years of recovery for more normal production to begin. Typically, growers can harvest a minimal crop three years after new vines are planted. Normal production occurs in the fourth and fifth years.

Globally, production is also down in New Zealand.

Turning to California, Kragie said water shortages in and south of Sacramento are affecting kiwifruit production. “California is short on water,” he stated. “This is putting stress on the vines.”

He expects overall volume marketed this season will be down approximately 10 percent, tracking statewide trends.

Western Fresh is looking at Sept. 28 as the first pick and pack date. As for the first pack out of California, he said, “Ten percent of the crop will move to fill worldwide pipelines.” As dry as the global pipeline is, Kragie added, “We’ve got to make it last into April before Chile starts.”

The company will have year-round kiwifruit supplies available. “We will stay ahead of the curve to ensure a great eating fruit for our loyal customers and consumers,” Kragie said.

 

Northwest pear growers forecast larger crop than originally expected

With harvest currently underway, representatives of the Northwest pear industry have officially updated their initial projections for the 2014 fresh pear crop yield.

Reports of a crop of excellent quality have been confirmed from all corners of the pear-growing regions in Washington and Oregon, and the updated projection is showing a crop larger than previously forecast in the spring.

The revised estimate points to more than 20.2 million standard 44-pound box equivalents (or 445,144 tons) of pears for the fresh market. This estimate is 2 percent larger than the five-year average, and 6 percent smaller than last year's record crop. The Northwest pear industry's initial spring projection showed a crop of 18.7 million boxes.

Harvest began in late July with the Starkrimson and Bartlett pear varieties. Anjou, Red Anjou, Bosc, Comice, Concorde, Forelle and Seckel will be picked from late August through mid-October. No significant weather issues have affected the crop to date.

The top three varieties in terms of production remain the same as in previous years: Green Anjou pears are anticipated to make up 53 percent of the total 2014 crop, while Bartlett and Bosc pears are expected to yield 22 percent and 15 percent, respectively.

The updated estimates for the organic portion of the Northwest pear crop have increased proportionally, showing a total of 976,780 standard 44-pound box equivalents (21,489 tons) of organic pears in the 2014 harvest. This is an increase of about 3 percent when compared to the 2013 record organic crop, and a 16.6 percent increase over the five-year average.

"Compared to last year's record crop, this crop is more consistent with the five-year average," Kevin Moffitt, president and chief executive officer of the Pear Bureau Northwest, said in a press release. "We're looking forward to another crop of excellent quality and fruit size to meet the demands of the domestic and export markets. Our representatives across North America and around the world have a full season of promotions in place to help boost sales, and we're looking forward to working with our retail partners in another successful pear season."