Food Waste Is Ripe for Profit

Every year Americans discard $165 billion worth of things they could eat. These startups are working to fix that

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But consumers may not be that easy to persuade. Outfits like Daily Table have to convince shoppers that they're not just buying someone else's rejected food.(Rauch counters this by asking, "If you shop at TJ Maxx, do you feel like you're getting expired clothing?") Consumers also have financial incentives to buy in bulk at big-box stores like Costco--even though that can sometimes be wasteful. And according to a Harvard and NRDC report published in September, people often read sell-by labels meant for store owners as the date when products go bad, though many times they may stay fresh for days, weeks or even months longer. As a consequence of label confusion, the average U.S. household discards $275 to $455 worth of perfectly good food a year. Total losses from food waste for a family of four average $2,275 a year.

Perhaps even more vexing is a lack of venture funding for such startups. Most firms like CropMobster and Food Cowboy are supported by charitable foundations or community donations. Even the most innovative programs will need large-scale, profit-minded backing to grow. That doesn't seem to deter CropMobster's Papadopoulos, though. "It's going to take a network of innovation to tackle this issue," he says. "One silver bullet won't cut the mustard."


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