BlueCart is a mobile and web-based application, which serves as a single wholesale buying platform for the restaurant and hospitality sector. The company will soon be launching “BlueCart Editions” to further tailor the platform to the needs of specific supply chains. Made possible by a recent US$10 million investment, “BlueCart Editions” provides unique tools for wholesale suppliers in seafood, produce, baked goods, dairy, meat, coffee, and dry goods, among others.
Since the platform launched in 2014, more than 27,000 businesses around the world have joined the BlueCart app.
Food Tank spoke with Konstantin Zvereff and Jag Bansal, the co-founders of BlueCart, to talk about the need for their new product and the recent work they have been doing to reduce food waste in the restaurant and hospitality sector.
Food Tank (FT): Can you give me a bit of background on how the app began?
Konstantin Zvereff (KZ): When we met in grad school, we were called in for an operations project in a fast, casual salad restaurant that was growing nationally. And from there BlueCart started. It essentially was a platform to procure all your supplies from a centralized place.
After grad school I spent three years in Africa, in Kenya and Uganda, working with a little over 9,000 farmers. And that’s when it became apparent that for us to develop a solid platform, we needed a two-sided marketplace. Meaning that the benefits for both buyers and sellers needed to be very strong.
As a result, we developed this platform that today democratizes the use of the best technologies across the industry. Regardless of how big or small a farmer is in terms of their financial ability, their access to that latest and greatest technology is enabled by BlueCart.
FT: What gap in the food system are you addressing through the BlueCart app?
Jag Bansal (JB): At the core when we started out, we were solving a problem when it comes to purchasing. When we talked to our chef partners, and bar managers, etcetera, the basic theme we’ve always seen is that they’re purchasing from ten to twenty different suppliers, and all of that is done manually.
Our concept is really bringing in technology so you don’t have to do a lot of manual work, don’t have to make a lot of phone calls, emails, and text message, but you can do all of that with a single application at the palm of your hand. So helping technology connect both sides of the equation, making their communication more meaningful, and it’s all in one platform.
Just to give you a scope of how quickly BlueCart has gone widespread in the industry, we now have over 27,000 businesses all over the world on BlueCart. That is predominantly U.S. based and 80 percent of those are still restaurants, and we use restaurant as a very generic term. Restaurant actually encompasses universities, it encompasses schools, Mom-and-Pop shops, deli shops, all the way to large restaurant chains, hospital kitchens, and even grocery stores.
So it’s really designed to suit the needs of some of the smallest to the largest of users. When we started out, we had zero customers, and today more than two percent of the U.S. restaurant population has been invited into the platform, and all of that really being done by the network effect of our platform. In some of the markets, DC for example, we already have more than 23 percent of the entire hospitalities space on BlueCart.
FT: How can direct wholesale relationships improve the way that suppliers do business?
KZ: From the supplier’s perspective, what we do is give them the ability to offer mobile and online ordering. Within three and a half minutes they can upload their catalogue, upload their list of buyers, and immediately electronic invites get sent out to all of their buyers. Like Facebook and LinkedIn, that enables their buyers to download the app and have access to that electronic catalogue.
So a farmer, regardless of how big or small they are, they can have mobile and online ordering. They can continue doing their daily tasks on the farm, and then at night they don’t need to worry about listening to answering machines or reading emails, everything is already sorted out.
And what we’re tapping into here is essentially the fact that it’s absolutely inevitable for BlueCart to exist. We do not see the future as a future where there are 17 different apps or e-commerce websites to place 17 different orders. There’s going to be aggregation and that’s what BlueCart is enabling them to do.
FT: How are restaurants using BlueCart to reduce their overall food waste?
KZ: Here’s where it gets really interesting, and hopefully this is where the story really resonates with you. I hope it’s obvious that Jag and I have a sustainability seed planted into us, where we’re constantly trying to look at how this technology is really changing this industry for good. Adding value not just to buyers and sellers, but to the entire ecosystem.
We did a white paper study about nine months ago, where we sampled more than 10,000 restaurant owners on BlueCart and outside of BlueCart. And what we realized is that BlueCart users had a 52 percent reduction in food waste. So that was mind-blowing: none of our features in the app are catered to food waste reduction. And we wondered, why is this happening?
We did a little bit of investigation and we realized that our restaurants were running with leaner inventory. They did not need to store such high levels of perishable products and they were actually operating with fresher products and wasting less food. So that was completely eye opening for us.
So a couple of months ago we said, what if we started tracking the carbon footprint when it comes to miles traveled by customer? When it comes to other initiatives that really get us excited as a tech company? So along those lines we said, let’s share these stories with the public, and let’s do the Zero Waste Kitchen as an initiative.
What we did was we brought three chefs in three different cities―New York, D.C., and San Francisco―and said let’s follow their journey as they come onboard in BlueCart. And let’s ask our community to share food waste reduction practices with each other, such that we can continue this momentum of food waste reduction.
So then the management team sat down and we said, we know that 40 percent of food is wasted in this value chain, and the majority of it comes from the supplier with “ugly food” and things of that nature. So we started brainstorming, and we asked: what can we do as a company to reduce this?
So what we have in the platform today is a way for suppliers to offer deals to their entire buyer base. Let’s say you have a surplus of tomatoes. We enable suppliers to present these tomatoes at a discount to all their buyers at no cost. So what we’re doing right now, is we’re repurposing existing features to tackle food waste in the industry.
FT: Where you see technology pushing the food system in the next five to ten years?
KZ: Our view of the future is that there’s going to be a system that everybody is going to follow such that all data communicates with each other.
We originally started in Washington, D.C., and when we started two years ago the Pope visited Washington, D.C.. What we saw in the platform is that 90 percent of our D.C.-based restaurants dropped their purchase of highly perishable products. Which is expected because the roads are going to be closed, there will be fewer people coming in, the metro’s going to be a big issue, so business is going to be disrupted. The same exact thing happened with the last snowstorm or with the inauguration.
Now get this, we saw a very small group of restaurants that did not know that this event was happening. And as a result, they continued to buy perishable products at the same rate as they would otherwise. So those restaurants obviously incurred a significant amount of food waste.
What we’re doing internally is we’re working on figuring out how to circle this data back to our users and say listen, restaurants in your area have decreased their purchasing because of this event. So essentially start sharing data back with our community.
FT: BlueCart has a global footprint, what are some of the biggest challenges in setting up a network with such a large user base?
KZ: The biggest challenge that we have is that this is a razor-thin margin industry. As a result, we have a very risk-averse population that we’re going after, and we need to get everything right from the beginning.
Our user base demands a perfect product, our user base demands a product that works all the time, our user base demands a product that has perfect data visibility. Otherwise they face a very serious risk of going out of business.
So that implies that ourselves as a company, we have to hold ourselves accountable to a very high level of excellence. Our product needs to be airtight to fulfil the needs of our user base. So that is the biggest challenge that we have, is making sure that we hold ourselves accountable, and that we raise the bar to make sure that we meet the needs of our audience.