Marcia Woods has combined her personal experience with small-scale farming with the growing demand for local food. FreshSpoke is an online logistics application that connects wholesale food buyers to local wholesale food producers and simultaneously organizes delivery.Geoff Heith
Marcia Woods grew up in a fourth-generation farming family in Oxford County, Ont. Like many others of her generation, she watched her family’s small farm struggle as large-scale food production became the norm.
Left with little other choice, her family sold their farm in the 1970s to open a small general store in Kintore, Ont., near Woodstock – but they eventually closed that, too, as supermarkets began dominating the market. Watching her family sell both their farm and their store left Ms. Woods with a keen interest in agricultural food production and distribution.
“I loved the farm and I loved that little store,” she says. “It stuck with me my whole life that the food system was very fragile and the distance between farm and fork was getting wider and wider. I was always a foodie and active in local food, so when my career turned to tech, I started baking this idea that perhaps there was a way that technology could bring people closer to farmers and producers.”
It wasn’t until years later that she began working on the idea for what would eventually become local food logistics platform FreshSpoke.
With the help of her co-founder and software engineer Henry Quach, Ms. Woods crafted an application that connects wholesale food buyers, like restaurants and retailers, to local wholesale food producers, like farmers and bakers, and simultaneously organizes delivery by using local independent and small-fleet delivery trucks with excess capacity. With the help of several early-on investors, they launched the operation in September of 2014.
Combining her personal experience with small-scale farming and the growing demand for local food, Ms. Woods has been able to launch a platform that’s since grown to employ 14 people.
FreshSpoke supplier: Albert Burns of Cold Creek Stock in Cookstown, Ont., breeds and raises heritage cattle.handout
The award-winning Barrie, Ont.-based startup is now connecting more than 175 suppliers in Ontario, Saskatchewan, Michigan, Ohio, and Indiana to 350 wholesale buyers in the same regions. FreshSpoke’s suppliers sit along a wide spectrum of local goods – from produce, dairy and meats to coffees, canned goods, wines and breads.
Unlike their competitors, 100 Kilometre Foods and localline.ca, which dominate the local market for food logistics platforms and operate via their own truck fleets, FreshSpoke is unique in that it is “scalable,” not tethered to any single location. Using excess capacity in existing trucks also cuts down on FreshSpoke’s operation costs, which allows the platform to price its goods competitively.
“Our platform can literally go anywhere because we’re not beholden or tied to investing in warehouses or distribution centres or trucks,” Ms. Woods says. “We can just tap into what already exists in the marketplace wherever we go.
“What we’re doing is really focusing in on a logistics system that enables not just five-star restaurants to be able to procure local food but for … retailers and restaurants and everyday mom and pop bistros to be able to procure local food," she adds.
The process of accumulating a web of client suppliers was a hands-on one, Ms. Woods says, which picked up traction between 2014 and 2015 when she began actively conducting market research.
FreshSpoke supplier: Gerdon Broekstra of the Norfolk Potato Company near Delhi, Ont., grows a wide variety of potatoes.handout
She has since developed long-term relationships with suppliers such as Albert Burns of Cold Creek Stock in Cookstown, Ont., which ethically breeds and raises heritage cattle like Galloway and dual purpose Shorthorn cross, and Gerdon Broekstra of the Norfolk Potato Company near Delhi, Ont., which supplies Russets, Kennebec, Eva, Chieftain and Yukon Gold potatoes.
“I drank a lot of coffee, a lot of tea around a lot of farmers' tables,” Ms. Woods recalls. “That was a lot of folks all the way through the supply chain, you know, from small mom and pop retailers and restaurants right up to speaking to the folks at [Gordon Food Service Canada] GFS and Compass with that fundamental question, which is: Consumers want access to more local food, why aren’t you giving it to them?”
It was through this research that Ms. Woods realized the process of procuring food from local suppliers is a complex one with a slew of middlemen, that’s “not profitable” and that’s “not efficient.”
“The average imported product touches an average of 30 hands before it reaches the consumers,” Ms. Woods explains. “The supplier, the person that’s done the most heavy lifting in the value chain, gets 15 cents on the dollar, and so right away you’ve got a situation where there’s an inequity.”
Her solution to this problem was to cut out the middle man by connecting suppliers and buyers directly on FreshSpoke’s site.
She also strove to make the venture as “carbon-friendly” as possible. The platform operates on three-day, must-deliver-by cycles in which it collects and consolidates orders from buyers, places them with suppliers, and alerts registered truck drivers of the order time, location and volume for transport.
“We’re not adding any more carbon, we’re creating way more efficiency and reducing that urban congestion as opposed to adding to it by putting more trucks on the road that are driving into urban centres like Toronto.”
FreshSpoke's platform.
The idea to capitalize on excess transport capacity is “great,” overall, says Sylvain Charlebois, professor in food distribution, policy, safety, and security at Dalhousie University’s Rowe School of Business.
“This is certainly one way to actually make things a little bit more efficient,” Dr. Charlebois said. “There’s lots of trucks out there that are actually half empty, and you require the same amount of fuel … to move these trucks around. So if you have a truck that is half empty, you’re losing.”
He noted that with its logistically efficient business model, FreshSpoke is uniquely equipped to serve communities facing food insecurity, like Nunavut and the Northwest Territories, should the company seek to grow in that direction in the future.
“The more you can actually reach markets that are not easily attainable, usually, you can actually decrease the price of food products,” Dr. Charlebois said. “There are several areas where food security is an issue, and a lot of people don’t necessarily understand the power of logistics. This particular company actually leverages the power of logistics to serve markets that are often regrettably underserved.”
In the meantime, Ms. Woods says she aims for FreshSpoke to reach Southern Ontario and regions in the United States from Chicago to the Eastern Seaboard by 2020. She plans to do so using a nimble approach to platform development, repeatedly adjusting FreshSpoke’s strategy and technology to address ongoing challenges.
“It’s really a process when you’re pioneering like this,” she says. “The key to this whole process is being able to really listen to the market and be able to continue to pivot and pivot and pivot until you really have things working well.”