Today we are fortunate to have two guests. We have Richard Torino and Jonathan Englert rom the food box delivery startup Good and Fugly.Rich started the company with his decades of knowledge in the marketing and customer experience sector in Australia and the UK. He works at the nexus where social and environmental impact meets real commercial outcomes.Jonathan has nearly two decades of experience in sustainability, renewable energy and technology. He’s worked at Campos Coffe, zip money and Go Get Car Share, where he met Rich. Jonathan is on a mission to bring purpose driven business ideas to commercial success.
Please tell us about the business
Rich: Good and Fugly have a network of growers around the country where we buy the produce from them that is rejected by supermarkets for aesthetic reasons. Up to 25% of produce never leaves the farm because it’s not pretty enough. And that’s what we buy and then sell, as you said, put in fruit and veg boxes, seasonal boxes that we sell direct to consumers and deliver them to people’s doors and offices as well.
Why does food need to be rescued?
Due to certain expectations set by supermarkets, produce must meet certain criteria, such as being perfectly round or a certain size. This means that perfectly good fruits and vegetables are rejected and often thrown away. When the founders of the business went to talk to growers, they learned that it was not worth the cost of putting these rejected fruits and vegetables into boxes and transporting them to markets. They had to convince growers to work with them instead and sell the fresh produce that would otherwise go to waste. In the early days of the business, the founders had to learn about the industry and the best ways to work with growers.
They found some growers who were willing to sell their “fugly” produce, and the business started to grow from there. The Farmer Rescue initiative was started after a farmer contacted the business about having hail-damaged peaches that he couldn’t sell through his usual channels. The initiative involves a Farmer Hotline for farmers to call when they have a large amount of “fuglies” that they can’t sell, which can happen due to oversupply or damage. The business aims to reduce waste by selling this produce and paying growers a fair price for it.
now, the way Good and Fugly was born was during the beginning of the pandemic in Sydney’s first lockdown. And it came about with me and my family getting fruit and veg boxes and around that time found out that about 30% of produce that’s grown across the world is wasted and 25% of produce never leaves a farm. I had the idea, why wouldn’t you be able to buy imperfect produce in seasonal boxes? So I looked around to see if anyone was doing it here in Australia. No one was. And then I looked around the world and found that in the US and the UK and a bunch of other places, these kinds of businesses were taking off, that there was a real demand from people. I spoke with Jonathan about the idea and we both thought, let’s give it a crack. I was at Go Get for twelve years, saw it start small and grow, and we put into place the things that we learned there. And one was just to have a crack, see if there’s demand for it, starting in a Kennard storage unit, just delivering to a few suburbs in Sydney and it’s just taken off.
We had these assumptions and it’s proven correct that people really want to do good for the planet and it’s kind of hard. Whereas being able to buy a box of delicious, nutritious produce that’s fresher than what you can get usually and help the planet and farmers was a win-win for everyone. And the feedback we’ve gotten so far has been great. So we’re now in all of Sydney, Melbourne and Brisbane as well.
Jonathan: We just added Brisbane. But, I think when you were looking to start, you were looking for something that could actually have a big impact, potentially.Rich: Yeah, absolutely. So, look, I was at Go Get for twelve years and for those that don’t know, it’s a car share company, Australia’s largest, and the whole mission there is to reduce car ownership, get cars off the road. So what I’ve learned in those twelve years at Go Get was to really have an impact – whatever the kind of alternative, sustainable alternative that you’re trying to sell or promote – it really needs to be as convenient or as affordable as the alternative. Otherwise you’re going to have just a few people who take it up.But you’re not going to have mass appeal. And that’s something I really wanted to do in whatever it is we did next. And that’s what we found with Good and Fugly is our boxes have to be as good as anything you can get, and fresher and as affordable as the alternative, which is supermarkets.Jonathan: And we think that notion of a sustainable, sustainable enterprise is central to our approach. It’s great to have a strong ideal and a mission, we do have that. But we saw this with car share and we’ve seen this across lots of different kinds of sustainable businesses where they don’t get the commercial aspects of it right, they don’t connect with the customers, they don’t understand where basically the customers are and what they want, and they don’t deliver on that. And so that’s been an important focus for us, is not to lose sight of that, for this to make it work.
Just to go back to the car share quickly. We saw how hard it was to move people out of cars into a car share system in which they would be helping to impact the environment positively. It takes a lot to move behaviour, and we’re seeing a similar thing here, getting people to overturn a lot of acculturation around rejecting ugly fruits and vegetables. I mean, there’s two sides of the equation here. There’s the supermarkets, which to a large extent haven’t been doing the right thing. But there’s a behaviour that’s been baked-in and such that customers will reject the ugly fruit as well. So there has to be a learning, a big education process.
Why does food need to be rescued? Can you tell us a little bit about why so much produce is left on the farm?Rich: Yeah, so for whatever reason, we’ve ended up in a place where tomatoes have to be perfectly round. If it’s got another little tomato growing next to it, or if there’s a scar on it, it gets rejected. Our mission is that we should be judging fruit and veg on the quality, on its nutritional value and how fresh it is, rather than how it looks. We’ve ended up in a situation where potatoes have to be a certain size, when we all know potatoes come in all different shapes and sizes and it’s really the supermarket that is driving that. And so growers are trying to grow to particular kind of standards, but then for anyone that’s grown veggies at home, you know that carrots don’t come out perfectly straight and so those just get rejected.When we first started the business and we went down to the Sydney markets to talk to growers there was a bit of inertia with growers because a lot of them had been burnt before. They’ve brought what they call their seconds up, your curly cucumber, to the markets and then just haven’t been able to sell them to supermarkets or anyone else. And what we learned was to put any produce into a box costs money. You got to pay for wages. There’s the fuel, the transport, transporting it to the markets. And the growers were just like, it’s just not worth it. And that’s one of the things we had to overcome to really tell growers, look, don’t throw it in landfill, don’t just plough it back into the field, bring it to us and we’ll sell it because the stuff’s perfectly fresh and delicious.
Jonathan: Yeah, I think one of the things, in a sense, you’re glossing over it, but I think you should tell the story of those early days, because there’s been a lot of learning. Our learning curve is probably going to be tracking what the customer’s learning curve is, ultimately, because it’s a completely different world. And I think in the early days, when you first went to the markets, you weren’t even getting up early.Rich: Yeah. So when we came up with a concept, it’s like, right, got to go to the city markets, speak to some growers. The first day I went, you’re way too late. 06:00 is way too late. You need to be here at kind of 4 am. So then I went back the next day at 4 am and got to meet a lot more growers. A lot of them were when we were starting out, these guys are busy, they’ve got to take care of their bigger customers. But we luckily, we found a couple of brothers the local Sydney Basin who, again, I think may have felt pity on me. We started working with them and a lot of it was like, why do you want to buy the ugly stuff? Like, look at this stuff. It’s perfect, it’s beautiful, it’s super fresh, it’s cheap. And I think I called Jonathan in excitement the first time I got a call from Farmer Steve saying, hey, I got a neighbour who’s got some eggplants that he couldn’t sell because they had noses on them or whatever. And so we got them and kind of snowballed from there.Jonathan: Yeah. I think the funny thing about that reaction was there’s almost like a disbelief of these it’s like people who’ve been in prison a long time and then suddenly the door is flung open and they’re suspicious of walking through that door because they can’t believe they’re let out of prison. Honestly, the reaction from farmers, I find myself I’ve done this, too, like what Rich said, just explaining to them, now, there’s this thing we can do together where we’ll pay you a fair price for your produce and, you know, it’s good and fresh. And farmers consistently feel passionately once you get to talking about this, they feel passionately about how good that produce is that they’re wasting. And they’re unhappy about it. They’re unhappy about it commercially because of all the resources that go into producing it, but they’re unhappy about it emotionally, I think, because they really feel an attachment that there’s this value. And so that was one of the reasons we launched the Farmer Rescue Hotline.Rich: That came about because 18 months ago we’d built up a bit of awareness and we got a call from a farmer down in Swan Hill in Victoria who called us up. He found us online, he had three batched of peaches that had been damaged by hail and so couldn’t sell them through his usual channels. We ended up taking as much as we could, not as much as we wanted, because our customers got a lot of peaches for a few weeks.But what that did was a couple of things. One gave us the idea of creating this Farmer Hotline. So it’s 13000-FUGLY. Farmers call us up when they end up with a harvest with a large amount of fuglies…Jonathan: ..and it can happen in a heartbear, like with him, it was hail damage.
Rich: Others are sometimes supermarkets will over order in the future and so then demand hasn’t been as high as they expected, so then they cancel their orders going forward. Fuglies aren’t just shapes and sizes and central scars, it’s also oversupply.So we could only take half of all the peaches that he had and it’s like, wouldn’t it be good? Basically from this came about a partnership with a company called Cornersmith and they’re all about teaching people how to reduce food waste in the home. But they also do a lot of pickling and making jams. And so through them we were able to kind of make jams. So last year, when there was an orange glut and a lot of oranges were just being put into landfill, we were able to buy a bunch of oranges from farmers and turn it into marmalade with Cornersmith. And what that does is extend the life of those oranges for two years because you can store them for two years. So that’s been a really important part of the future of our business.Jonathan: Exactly. And what we’re really looking at is all of these channels or all these levers that you can pull to reduce food waste. We grow a lot in Australia. We grow more than actually we’ll ultimately eat. And so there are all of these opportunities to just look at what’s being grown on farms and figuring out ways to get it preserved for the long haul or getting people to eat more.
Part of our mission, in a sense, if you look at one of our partners, Nutrition Australia, is realising the nutritional benefit of what’s in our boxes. Each one of our boxes is literally like the nutritional recommendation of eat a rainbow. The rainbow, it’s in our boxes and that’s a good thing. And kids aren’t eating enough. Five percent of kids are getting the required amount of fruit and veg. So we can fight waste at the same time as we’re having all these positive benefits.What’s the value proposition that you bring to the consumer?
Rich: Yes, so it’s about the freshness of the produce. Its much fresher than what you find at supermarkets. A lot of our stuff has been the stuff that’s getting delivered tomorrow is being harvested right now. So it’s super fresh, obviously, and has nutritional value.
And a big part of it is a lot of our customers have come to us. It’s the first time they’ve ever bought a fruit and veg box and they’re drawn to it, to us because of the mission, because they want to help reduce food waste. They see that it’s a huge amount of waste of emissions produced by all the produce that gets thrown out and they’re really drawn to us by that. And so then they join and to be honest, the first box they get, from what we’ve heard, is a lot of them are like, oh, no, look at all this fruit and veg. Now what do I do with it?Jonathan: I’m just going to interrupt you for a second, because in the early days, I got a box and it’s changed my life. And I was calling Rich and going, ‘what is this’? I couldn’t identify some of the fruit and veg because we get some pretty interesting stuff like
Rich: Surprise, Jonathan, it’s pumpkin!Jonathan: I’m not that bad, but some exotic ones
Well, consumers like to be delighted and surprised, so I think that’s what you’re doing!Rich: Yeah, so what we do is we try and as well as put something in like a bit of a hero fruit or veg, maybe something I haven’t used before. One of our most popular is a Romanesco,Jonathan: which is what I called you about, I think it was.
Rich: It was not a cross, but it’s almost like cauliflower, like a cauliflower
from space:
Jonathan: it’s really alien looking, but it’s delicious!Rich: And then we also put in recipes for it. When you do get something like that, you go, ‘Right, here’s a recipe, give it a try’.But what we found was that after the first box people are a bit like, ‘oh, my God, what do I do with it all?’ But they’re really motivated to not waste food. And so by the third box, people’s habits have changed completely. So the whole family is eating a lot more fruit and veg.
What we’ve been told by some customers is they’re saving money. So not just on the fact that our produce is between 20% and 30% cheaper than what you find in the supermarket, but also because they’re cooking more, they’re not going out as much or they’re taking their lunches, so they’re not buying lunch every day and stuff like that. So it’s really changing their behaviour.
Has there been any resistance for consumers who might have second thoughts about the idea of eating something that is waste?Jonathan: I think they just wouldn’t come to us.Rich: And we haven’t really spoken to anyone when we talk about it, because it’s definitely waste has all these different connotations, but when we’re talking about kind of the on-farm food waste, this is stuff that’s super fresh and it’s just that it looks weird, it’s a little bit weirdly- shaped and people get it. And so, no, we haven’t really had any resistance to that at all.Jonathan: Where we do get something is in terms of our boxes are more affordable. So people come to us, particularly as inflation has gone up and gone, yes, this is great, more affordable. But then sometimes we’ll get a bit of pushback where someone will say, ‘oh, well, but this is not more affordable than the Uglies at supermarkets’.One of the key things to recognise is that, A, we pay our farmers fairly and B, a lot of the stuff that is Fugly in the supermarkets is also a victim of their ridiculously long supply chains, which, to Rich’s point earlier about how fresh our stuff is. Some of these things are like two or three weeks old.
A big eye-opener for us was speaking to farmer groups and hearing about how the supply chain meant that fruit and veg was sitting on loading docks then getting to the shelves three weeks later. And in some cases in regional Australia, they literally send the fruit and veg out and then three weeks later, they see it wilted and sad in their local supermarket. It comes back to them.Rich: What we’ve been told is a lot of supermarkets will, when they’re talking with the growers say, ‘okay, we’re going to buy your whole harvest over the next year and we’ll pay you for everything that meets our standards and we’ll take everything else that doesn’t’. Basically, they don’t pay for it, and then they can price it really low in their ‘imperfect’ sections.But what was really interesting when we first started was we found there was a study done in France where how to increase the uptake of imperfect produce. And what they found was pricing is super important because if you price something as 50-60% off, what you’re telling the mass consumer is: this stuff isn’t as good as the other stuff. So that turns a lot of people off. Whereas if the pricing is closer, then, yeah, you don’t turn people off. People don’t think it’s a quality issue. That’s something that we’re really conscious of as well.So what’s the scope for expansion? You mentioned you guys have just started in Brisbane. Give us a bit of a taste of what the future holds.
Rich: We want to sell fuglies to the whole country. So over the next 18 months, we’ll be expanding into other markets. We’ve got the East Coast, but there’s a lot still to do. That’s where we’re going.
We’re also working on building out other types of products. We want to upcycle other Fugly produce into jams and sauces and everything elseJonathan: Yeah. And I think also this is both commercial and social enterprise-related for us, but it’s raising this awareness, making the behavioural shift, becoming hopefully a voice for the growers and the farmers, because right now there’s just a mismatch between the growers, farmers, and the supermarkets.For our food system to become healthier, that needs to be addressed and dealt with because we’ve seen things on the technology front that blew us away. I’m not going to name the Apple producer, but we saw when you’re talking about these specifications, nothing drove home to us these specifications like seeing this factory, like, pretty much a robot processing facility run by AI that was selecting to an incredibly high spec apples. And it was really impressive.On the one hand, you’re like, ‘this is incredible!’ On the other hand, you realise just what got rejected, and a lot got rejected off the back of this. And this is stuff that was already almost prescreened, but it was an amazing experience it’s interesting that technology is double edged, isn’t it? It can be used to reduce food waste, but perhaps in this case, it’s actually contributing to the problem by better enabling that discrimination against the fuglies in a processing environment.Jonathan: It did do that, but in all fairness at this particular processing facility, these people are very aware of it and they’re doing a lot to fight food waste. But what it just marked was the fact that there was an issue here.We’re very interested in technology here at the Fight Food Waste Hub. Can you guys tell us anything about any interesting technologies that enable your business model or perhaps any other exciting innovations in the whole reducing food waste space that you’re excited about?Rich: Look, for me, it’s the precision farming advances that are happening, I think it’s really exciting.
But then the other element, and people that we’ve talked to who are working in this space, is the tracking of the whole supply chain. So putting in trackers from on the farm and then just tracking the products all the way to the consumer.Specifically, in this case, it was about the cold chain, kind of seeing how temperatures go up and down along the supply chain and kind of finding out where there’s some issues where maybe the particular facility, they’re not that good at closing their fridge doors, for example, and then working being able to pinpoint it and fix things that are really easy to fix, that will end up having a really big impact on stuff that gets wasted.Jonathan: Quickly just on that, not to get into the technical details, but the cold chain means that if temperature levels fluctuate too much, spoilage happens faster. And that’s a big part of food waste. Because we’re not just talking about fuglies, because we’re also talking about things that can then maybe not be edible, and that is food waste also.And I think that’s one of the areas of technology, I think anything also from the product side that can be developed that can make us be able to take these fuglies and turn them into really delicious and nutritious products. That’s something we’re always looking at as well.So, Jonathan and Rich, I have been meaning to ask: which one of you is good and which one of you is Fugly?Rich: We’re both! It’s all about being good and fugly. You can be good and fugly at the same time.
Jonathan: And fugly is a value!Rich: The name actually came about when we started the business. We wanted something that was kind of quintessentially Aussie and that would also express the brand values. And we wanted something fun. We wanted something irreverent. And ‘fugly’ means what everyone thinks it means. Except when my six year old son asked me, what does fugly mean? Thinking quickly on my feet, I said, fun and ugly! So that’s the PG version.Jonathan: …which is also actually true of our brand. Not to be cheesy, but it is fun and ugly. And recently, in raising awareness because it’s supposed to grab your attention, it does grab people’s attention.We launched ‘Australia’s Hunt for the Fugliest Fruit and Veg’ in an attempt to see what fuglies were out there and just get a spotlight on them. And we were blown away by the amount of entries.
This one has quite a lot of marketing experience, and any marketer will tell you that contests are a fraught area. I was clueless about this.Rich: I was basically saying, what’s the contingency plan when we get three entries?Jonathan: Three entries? And I was like, no, Rich, I’m sure we’ll be fine. I mean, it’ll be fun. I had no clue as to what we would actually have, but we were amazed.We got almost 750 entries, got national media attention off the back of it and the ones coming in. It was also heartening just to see the kinds of entries that we got. It was great. And the eventual winner was, because it just closed out, was a mom who had set up a school garden, primary school garden, to teach kids about the value of getting closer to the earth, growing your own fruits and vegetables and yeah, it was really great.Rich: We didn’t know who it was until after we called her to tell her, she’d won.
Jonathan: Yeah, we did not set that up.
What advice would you have for other entrepreneurs who are interested in getting involved and making an impact in reducing food waste like yourselves?Rich: I guess the kind of number one piece of advice is you don’t have to be perfect to start. Just start and you’ll get better and better. When we first started, all we did was put fuglies in our box boxes. Customers would have gotten a box full of oversized cauliflower. So what we did was we supplemented it with stuff that wasn’t fugly to give people that really like a convenient box that would get them through the week. And as we’ve grown, as we’ve built our network with growers, more and more of our boxes are fugly.As we’ve grown, we’ve added other sustainable things to our business with our packaging, there’s no plastic in any of our boxes, things like that. But to start with, if you spend too much time on being perfect, you’re never going to get off the ground. So really I think just push forward and get better as you go.Jonathan: Yeah, and I think I would add to that. I agree with that. But it’s also you want to have a core and what I can look back on the history and see that we haven’t actually deviated from that core. We’ve made lots of changes along the way and always I think communicating and letting your customers know and not just your customers but everybody partners, (we’ve got a lot of great partners) and various other – I don’t like the word – stakeholders, but that’s what it is. Keeping the communication open and being transparent, that’s really important.But I do feel like there’s a core that you just keep going and you’re aiming for that mission, but being sure that you also keep the lights on commercially. It’s really important.Rich: I guess the other is just feedback from customers, especially as you’re starting out. They help you build the products or build the product that you’re providing.The third is: no person is an island. You’ve got to have great partners and building networks and fighting food waste or just even a business that’s got a real purpose in doing good. People want to help you and so they give you opportunities to expand or amplify your message and I think that’s really important when you’re starting out as well.
