Farmer's Fridge and Plante Moran highlight the value data brings to food and beverage brands

By Mary Ellen Shoup

- Last updated on GMT

It's not about hiring a data scientist with a pedigree, pull together the people that have access to raw data and leverage it by asking the right questions, advises Plante Moran's senior manager of analytics. ©GettyImages/scyther5
It's not about hiring a data scientist with a pedigree, pull together the people that have access to raw data and leverage it by asking the right questions, advises Plante Moran's senior manager of analytics. ©GettyImages/scyther5

Related tags Data Farmer's Fridge analytics

There's a lot of hype around 'big data' and 'data analytics', but how can you cut through the noise to distill these buzzwords down into something that is useful to your startup or established company?

"Analytics is really just examining the raw data with the purpose of bringing actionable insight from that data,​" said Chris Moshier, senior manager of the Analytics Center of Excellence at public accounting and business advisory firm Plante Moran​.

"We all have tremendous amounts of data and what we want to do is turn this data into action -- analytics is a bridge from data to action."

Speaking at the at the recent Chicagoland Food & Beverage Network​ innovation breakfast, Moshier said food companies are increasingly recognizing the value of data and how to leverage it into actionable insights.

A quick scan of CNBC's top 50 disruptors turns up multiple food companies such as Gingko Bioworks that is taking yeast and bacteria and turning it into food flavors.

"They’re leveraging analytics, they’re leveraging machine learning to automate the process of analyzing these new genomes. They have terrabites of data about their bacteria,"​ Moshier said. 

Also on the list is Blue Apron, which has had trouble with customer retention through its subscription model, but is using the data to understand its customers' buying habits to drive production forecasting.

" is a bridge from data to action."

"They’ve created machine learning algorithms and created a brand around that."

You don't need a data scientist to analyze data

Harvard Business Review may have named data scientist as the "Sexiest Job of the 21st Century"​, but that doesn't mean as a food startup or an established company you have to rush to add a data scientist to your payroll.

"The real data scientist is a unicorn. That person doesn’t exist,"​ Moshier said.

What does exist for nearly every company is access to data, Moshier added. 

"Put together people that have the data, but know you’re going to have to supplement other skillsets they might not bring on day one," ​he said. 

Part of this approach is about asking the right questions, according to Moshier. 

"I would encourage you to explain the problem. What do you want to achieve? What do you want to know?"

For example, instead of saying, "I want to do analytics.",​ rephrase the question into something more specific such as, "What market should we strategically grow into?"

When making a plunge into analyzing data, Moshier says not to waste time and money on a new data analytics tool. 

"There are many open source solutions that are free,"​ he said. 

Farmer's Fridge and its data story

Farmer's Fridge has gained a reputation for providing convenient, quality, fresh food at 135+ of its bright green automated fridges in the Chicagoland area and Milwaukee.

But its lesser known strength lies in its ability to leverage data to drive sales, quadrupling revenue since 2016, according to CTO Raj Karmani, who argues that the startup is just as much a tech company as it is a provider of fresh food 24/7.

In 2013, Karmani founded the Chicago startup Zero Percent, an organization that collects leftover food from restaurants and markets around the city delivering the food to charities and organizations in need. To date, Zero Percent has facilitated the donation of 1.5 million meals.

Karmani connected with Farmer's Fridge founder Luke Saunders at a networking event and saw the 


opportunity for a partnership.

"Immediately I saw him as my customer,"​ Karmani said. "Low and behold, from day one he started donating, and there was a lot of food [from Farmer's Fridge]."

Zero Percent provided Farmer's Fridge with data to understand how much of its food was left over and helped optimize the stocking levels and product SKUs at each of its fridges (around 40 or 50 locations at the time). 

Farmer's Fridge utilized the data provided by Zero Percent to better understand its inventory, supply and demand ratios, and popularity of items. As the fresh food startup grew along with demand for its products, the amount of food left over at the end of the day also went down.

Building out a tech team

Realizing the value of using data to drive its operations, the company hired Karmani as its chief technology officer and over the course of a year, the Farmer's Fridge technology team grew from one person (Karmani) to eleven people. 

Its employee team now reads like a tech startup, with eight software engineers and UX (user experience) designer.

"Now at scale we run algorithms every single each fridge is stocked at differents level based on the sales of the previous day as well as production forecast,"​ Karmani said.

To get its product assortment right, Farmer's Fridge launched 25 SKUs over the course of three months and using the IoT (internet of things) built into each of machines, the company could quickly see what was selling and what wasn't, through straight sales data and quick one-question surveys sent to each customer.

"Once we created this feedback loop we started to see both qualitative and quantitative data coming at a very high velocity,"​ he said. 

"This feedback came back at such a fast pace that it allowed us to modify products."

Through this strategy of looking at both quantitative and qualitative data, Farmer's Fridge was able to identify that its sandwiches were not selling well and instead of stopping production completely, it switched out the bread for a higher quality version increasing its turn rates of the item.

Farmer's Fridge is currently working on a feature that will allow users to check the inventory of their local fridge and reserve the item to ensure it's still there once they arrive.

"It’s not some visionary mind is telling us to do this, it’s the customer feedback telling us this."

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