Watch List: The Ugly Company
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Founded by fourth-generation farmer Ben Moore, who answers our questions here, The Ugly Company finds new life for typically discarded fruit to help prevent food waste. It recently secured $9 million in its latest funding round from backers who include Justin Timberlake, which the company has earmarked for both capacity and sales expansion.
How do you explain The Ugly Company to retailers that aren’t familiar with you?
We upcycle ugly fruit that would otherwise be discarded and make healthy dried fruit snacks with no added ingredients. Last year we prevented 2.17 million pounds of fruit from becoming waste, and we have a goal to prevent an additional 3 million pounds of food waste this year. Each package helps at least 1 pound of fruit from becoming waste at local family farms in Central California.
Our products give consumers a way to eat sustainably and actively help farmers find a home for their fruit. When stores partner with us and put our products on their shelves, it gives us access to their consumers and the retailer becomes part of the solution as well. This helps retailers meet and exceed their stated sustainability goals.
How does technology contribute to your overall growth strategy?
The technology we've adapted and developed internally for dehydrating the “ugly” fruit is really the core of what drives our growth. Ultimately, for a product and brand to grow its presence, the company has to deliver the best food possible in its category and at a fair price.
The state-of-the-art equipment we've invested in, much of which we've invented internally, ensures our fruit has the best eating experience compared to any other dried peach on the market. Ugly tastes better!
What role do consumer insights play within your marketing and product development?
Consumer insights certainly drive our product development and marketing strategy. Initially, at the macro-level, with my background as a SunMaid raisin grower, I knew that the domestic dried fruit market grows steadily at 2-5% year over year, while the fruit with the largest market share — raisins and prunes — has declined in value consistently over the last decade. This has been driven by younger consumers' interest in new varieties of fruit.
At the more micro-level, we’re using consumer insights to update our product lineup from primarily diced fruits to introducing our new line of sliced peaches and nectarines. We’re excited about our new updated packaging and product lineup that will be released this summer.
What’s the biggest mountain you’re trying to climb right now, and how do you plan to scale it?
The hardest mountain to climb, from day one, has always been the chicken before the egg scenario of A) the lack of consumer demand for upcycled or valued-added products made from ugly stone fruit, and B) the lack of modern processing infrastructure to make these products with. It has been a very tricky balancing act up to this point to define the priority of those two.
We just bought a plant in Farmersville, Calif., and have been rebuilding and modernizing it. This is a pretty monumental task to undertake, and we’ll be implementing several new technologies that aren't proven at scale yet. We also need to ramp up our sales significantly to keep pace with what our plant can produce.
Where do you see the most innovation in retail technology?
The biggest change I have seen in the last few years is the number of customers shopping for their groceries online. Before COVID, a very small percentage of shoppers bought their groceries through an app or online. Now, at several of our retail partner stores, specifically in Southern California, a very significant portion of shoppers are employees filling carts for online orders.
In some stores, I’ve observed well over 50% of purchases are for online shoppers depending on the time of day. Reaching these online shoppers requires a very different approach than in-store methods. As a new up-and-coming brand, the most important challenge is to get consumers to notice you and give your product a taste.
Online shopping initially lends itself to favoring well-established brands with tried-and-true products, but online shopping does have its benefits for a young brand like ours. We have a very unique story that can be communicated effectively through video content. The newer generation of shoppers is very engaging with authentic brand stories and is looking for sustainable products to purchase.
In some ways, it can be easier to reach customers online rather than with in-store promotions that quickly become a significant investment. Innovation creates opportunity!
What’s next for The Ugly Company?
The biggest challenge in front of us is to get our new plant up and running this summer. We’re up against the wall to get all of our equipment built, delivered, and installed on time. There are still snarls in the supply chain, particularly for electric components and controls. We have a great manufacturing team and a very solid set of vendors that we are working with.
On the product side, our new sliced fruit options are nothing short of amazing. We have a packaging refresh in the works to complement the new products as well as additional serving sizes. Most importantly though, we are well on our way to meeting our goal of preventing 3 million pounds of food waste this year!