In light of COVID-19, which caused last week’s Natural Products Expo West to be postponed and is also wreaking absolute havoc around the world, I spoke with several leaders of organic companies to learn how this virus has impacted their business.
Here are their edited answers.
Greg Fleishman, Co-CEO and Co-Founder of Foodstirs
As an organic foods company, we believe that everyone should have access to clean, better-for-you options, even more so during a crisis such as this. And, we pay homage to this responsibility with relentless vigor.
The demand for our products has increased considerably, especially the powdered donuts and our new keto chocolate chip cookie mix, as people stock up on organic staples. We have been adapting to meet this surge while prioritizing the health and safety of our staff, their families, business partners and consumers. This means working remotely, building supply and moving product around the country ahead of schedule, and even inventing new ways to sample product to consumers — given that in-store demos have been suspended.
The COVID-19 situation is fluid, and we expect it to change daily, which is why we are planning ahead with a few different scenarios expected to play out this year. This will help us ensure we can deliver on our promise and responsibility as an organic foods company.
Mike Bronner, President of Dr. Bronner’s
Currently, our reevaluations of the business mostly focus on employee safety, well-being and peace-of-mind. For those people who are able to work remotely, we will encourage or discourage based on the latest developments. We have someone getting married overseas in Vietnam in April, and we’ve suggested that she should plan on working from home for two weeks afterwards just to be safe. And she is happy to do so.
Last month, we saw unit sales of our sanitizer internationally go up over 600%, much of that going to hard-hit areas in Asia. In total, our hand sanitizer sales in February equaled 25.5% of all sanitizer we sold in 2019. With fears penetrating the U.S., and our domestic customers stocking up on hand sanitizer, we now have current open orders that equal 29.6% of total 2019 sales, and there is no end in sight.
We have been able to improve production to equal 500% of what our rate was last year, but even with that increased output, we will only be able to meet 60% of demand — at best. We are constrained to use FDA-licensed contract manufacturers for our sanitizer. Without that license, our own facility isn’t even permitted to repack them. So, for now, we are pushing the limit.
We also are keeping a reserve of 2% of production to donate to the hardest hit, low-income communities and the organizations that serve them, so they have access to our sanitizer as well.
Vani Hari, Co-Founder of Truvani
Right now, companies are getting caught gouging customers during a time of need. Not only is this wrong, it’s the opposite of what responsible trustworthy companies should do.
That’s why at Truvani, we’ve decided to offer our products on sale. People are buying now, more than ever, and we feel like it’s up to us to make it easier on people to get the supplements they need with a discount.
Jeremiah McElwee, Chief Merchandising Officer at Thrive Market
Right now, we are monitoring the situation closely every day and are asking all employees to check in with us regarding any international travel. Also, we do have some contingency plans in place if the situation escalates.
Nick Green, our CEO and Co-Founder, has posted a letter to our community where he said the company is taking three key steps to do its part: (1) steadily building inventory in the most important product categories: Immunity, Cleaning and Pantry Staples (2) to be 100% committed to never engage in surge pricing and (3) working around the clock to ship orders as fast as possible, while also maintaining our commitments to carbon neutrality.
Due to concerns associated with COVID-19, we are definitely seeing a big uptick in our Members’ pantry filling as well as a significant increase in out-of-stocks from our suppliers.
Paul Coletta, CEO of Urban Remedy
At a time when many experts believe that a significant percentage of the population will be infected with the coronavirus, our mission to educate and empower people through the Food is Healing motto is something that we regard as more important than ever.
And customers seem to be embracing this philosophy in a very significant way. Over the past couple of weeks, we have seen a pronounced increase in our business, particularly with products that help strengthen the immune system.
We do not view this as an opportunity to profit from a crisis but rather a time to be of service to those who need us the most.
Landon Eckles, CEO and Co-Founder of Clean Juice
COVID-19 has not resulted in any negative impact to our business. It has mostly been positive. In fact, our same-store sales from February 2019 to February 2020 were up 16% (50 stores were included in this report).
We are having trouble keeping two of our shots — Immune Booster and Elderberry Wellness — in stock. Some of our stores are producing 4x the normal amount of these two items just to keep up with demand. Our organic cold-pressed juice Orange (organic orange, organic pineapple, organic turmeric, organic carrot) is another one that we can’t keep on the shelf.
Our guests understand that strengthening their immune system is critical to preventing illness, and my wife Kat (Co-Founder and Chief Branding Officer) just released a podcast about this called Natural Immune Boosters for Cold and Flu Season.
More than anything, it is gratifying to see that guests are starting to view us as not just a juice bar or quick service restaurant but as an informative and valuable health and wellness company. We exist to serve guests incredible organic products that improve their well-being.
Minh Tsai, Founder and CEO of Hodo
The virus may, in fact, have played a role in increasing retail sales for Hodo products. In the past 2 months, we have seen an increase in demand of Hodo products, more than the normal post-new year demand by as much as 25%, and particularly for our Moroccan Cubes and Hodo Burgers.
COVID-19 has not impacted our production, as our supply chain is not reliant on supplies from affected countries. We are happy to continue to use U.S.-grown organic soybeans.
Our foodservice partners have shared with us that they currently do not foresee changes in demand. However, they also caution that commissaries at schools and tech companies may be closed with short notice.
On the labor side, however, we added additional safety measures on top of our rigorous GMP, such as extra sanitation stations, higher frequency of sanitation, encouraging our workers to communicate with us about travels, and monitoring their personal health and hygiene more actively.
With the postponement of Expo West, many companies lost a valuable opportunity to showcase their new products and gain valuable exposure, and Organic Insider will be doing the following:
1) On Monday, March 23rd, we will be sending out a special Organic Insider that features both news from organic brands/organizations and new organic products that were planned to have been unveiled at Expo West.
Please send a link to the press release and a short description to max(at)organicinsider.com and use the subject line EXPO WEST NEWS. This is only for new organic products and news from organic-related organizations.
2) John Foraker, Once Upon a Farm’s CEO and Co-Founder, started a thread on LinkedIn that offered suggestions as to how industry veterans can help mitigate this crisis. Inspired by John’s suggestions, I’ll be volunteering 8 hours of my time over the next two months to help emerging organic brands that have been negatively impacted by the Expo West postponement.
I will be doing phone calls in 15-30 minute increments, and if you would like to speak with me, please send an email to max(at)organicinsider.com and use the subject line EXPO WEST PHONE CALL.
Max Goldberg, FounderCollaborate // Contact
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