Lost in the Supermarket
Lost in the Supermarket
Unilever's Quest To Fix the Food System
Hanneke Faber is the Global President of the Nutrition Business Group at Unilever, with sales of over 13 billion and sales in more than 150 countries. She is also a member of the Unilever Leadership Executive Committee. She has been recognized by Fortune Magazine as one of the most influential international women in business.
Welcome to Lost in the Supermarket. My guest today is Hanneke Faber, the global president of the Nutrition Business Group at Unilever with sales of over 13 billion and sells in more than 150 countries. She's also a member of the Unilever Leadership Executive Committee. She's been recognized by Fortune Magazine as one of the most influential international women in business. Hanneke, welcome to Lost in the Supermarket.
Hanneke:Thank you so much, Phil. Delighted to be here.
Phil:Talk to us a little bit about the evolving balance that you've seen between retail and the purchase of foods for home preparation, delivery, eating out, and how Unilever has adapted with these changes that we've seen over the past two or three years during the pandemic.
Hanneke:Yeah, great question. So I think the great news overall is that the food market is in good shape around the world. So, it's growing robustly and we think it will continue to grow robustly for many years to come, driven fundamentally by population growth. And then within that, you know, now post a pandemic, we think eating out is gonna grow ahead of eating in, eating in and obviously eating at home saw a nice boost from Covid where we all, you know, relearned how to cook at home. But the demographics are just in favor of away from how we are eating, around the world. There's urbanization. People are moving to cities. About 55% of people lived in cities in 2020. That's projected to go up to about 70% by 2050. And when you're in a city, you just have more access to eating out. People are entering middle class, more women are working, all those people are traveling more, there's more tourism and all those things drive eating out and eating in restaurants. So while we think the whole food market will grow probably about 45% a year, the food service market will grow a little faster, probably seven or 8% a year. But both are very exciting numbers.
Phil:So through your lens, one of the biggest problems, that we have, at least here in the US it might be, different globally from where you sit, but labor, when we look at a lot of food service operations, they are struggling to hire people. So with this anticipated growth, what comes next? Are we gonna have these, you know, robots and AI taking over our food service operations?
Hanneke:Yeah, no, it's really certainly a huge problem in the US and Europe. And while we first may have thought that that would go away once the pandemic ended, it hasn't gone away. And even beyond the US and Europe, labor is a big issue. I think we'll have to innovate for great service in food service, and that could be innovate in, you know, with robots. We're seeing more and more of that, but also into products that chefs use. So our Unilever food solutions business is really about solutions for those chefs who don't have a, you know, huge brigade back in the kitchen because they just can't find the people. And I love some of the Knorr products that our yellow fruit solutions business has recently come out with. There's artisanal potato flakes that make a wonderful mashed potato, you know, usually then you have to make mashed potatoes in the back. Takes about 30 minutes, and it takes someone who notices what they're doing. These Knorr mashed potatoes take three minutes, anyone can do it, and you get a delicious and consistent quality. We have a similar solution for Hollandaise Sauce, a similar solution for Demi-Glace And these are really important solutions because people are struggling to find labor, as you say.
Phil:So when we take a look, and it's interesting, it wasn't something that I thought about. What you're really doing is focusing on, you know, how to make that backroom operation more efficient, hopefully more delicious. I've gotta admit that I am a huge fan of Knorr products. I buy them, I consume them, I love them. So, you know, what we're gonna see is a lot more innovation from your end, to help these food service operations.
Hanneke:Absolutely. And thank you for your fandom of Knorr, but there's many chefs around the world who are big fans of Knorr. It's probably the biggest brand back of house. And indeed that's what we're focused on. We employ more than 200 chefs ourselves. They're in touch with thousands of chefs around the world every day. And really we're trying to do so much more than just selling products. We're trying to figure out what are their means in the back of the house, whether their issues, labor is definitely at the top of the list, and how can we help them with both products and services.
Phil:So when I take a look, and you're talking about the chefs, I know you've just published a top eight global menu trends. I have them in front of me. I haven't gone through all of the deck yet of what you have, but you've really done a deep dive on the expertise of over 1600 chefs from around the world. So the global menu trends, and I'd like you to comment on a couple of them, but the first one is irresistible vegetables, second modernized comfort food, third low waste menus. Waste is a clearly a major issue for all of us on the planet. Wild and pure flavor, contrast, feel good food, the new sharing and mindful proteins. Of these eight global menu trends, what are your two favorite ones that we should talk about?
Hanneke:Oh, it's hard to pick. But, I think irresistible veg is huge. Low waste menus is super important, and I'm a personal fan of modern comfort foods. So, those would be my top three picks.
Phil:So when we look at irresistible vegetables, you're talking a lot more than just plant-based.
Hanneke:Yeah, absolutely. When people say plant-based, often they only think about plant-based meat, which obviously is, is one element of, of the plant-based movement, but there is so much more to vegetables, and plants. So you don't necessarily have to have a plant-based burger, because there's so many delicious recipes that are really just from plants. So was gonna look at the trans report, but you know that the first recipe that trans report is a carrots four wave with, with moly chucks that is just plans. But it is absolutely digital delicious and you know, five star restaurant worthy. So, we love cooking with clans. The world needs us, certainly us Americans and us Europeans to eat a little bit more plans and a little bit less meats. You know, one third of all greenhouse gas emissions come from the food system. And within that one third more than half is from cows. We're not asking everyone to become a vegetarian, but we would do the planet's health, but also our own health would benefit if we just ate a little less meat and a little bit more plants. So many, I would say most consumers around the world actually recognize that they want to eat more plants. Well, they often don't know how, you know, how, how, how do you cook all those recipes that you've cooked forever? and that's both chefs and consumers with plants, and that's what we're trying to help both chefs and also consumers with, with these, types of recipes.
Phil:Well, I think this approach, is, is the correct one because when I take a look at the tens of millions of dollars that have been, in my opinion, wasted with these promotions that say, you know, eat five, fruits and vegetables a day, or nine fruits and vegetables a day, we haven't been able to raise consumption. And I think for exactly the reason that you stated, you know, yes, people want to eat more plants, but they don't know what to do with them. And just giving them a number, saying, you know, eat more, doesn't solve the problem, but giving them recipes, such as you're describing does make the difference.
Hanneke:Absolutely, absolutely. And again, we're seeing that both, both with chefs. So the rest, the recipe I just referred to as you really meant for chefs and backup house restaurants, but we're seeing it with consumers as well, you know, when you help consumers, and again, nor does this really well, you know, spaghetti bologne is one of the top dishes in, in Europe and the US that people cook at home. When you help them with some alternatives you do to bologne, you always do. But instead of mince meat, you either use, a plant-based mince meat<inaudible>, you know, from our grand, the vegetarian butcher or another grand, or you use lentils instead, and you know that you actually make a delicious bolognese the same way you've always made it, but you've swapped out one evening where you don't eat meat. And, and that's what we're really trying to drive. and we try to drive that in our products as well. You know, we, we sell a lot of chicken stock, for example, but we're really focused also now our vegetable stock, which is also delicious. And again, doesn't require me to cook any different. when I make the dishes that I usually use chicken stock for, I now use veggie stock. So that's the way we're trying to nudge people to eat a little bit more plants and do the same for chefs.
Phil:So we've got a problem with plants, though, at least here in California, because it's been raining since, you know, the middle of December. it continues to, to have bad weather in a lot of the crops, especially when we look at leafy greens or other crops that come from California exclusively like almonds, or being destroyed by the weather. So from a global standpoint, you know, how, how will Unilever and, you know, all, all the brands that you've got deal with the potential shortages that we have, because of, of climate change.
Hanneke:Yeah. Still, I'm still happy you asked a question because I think this is one of the biggest challenges that big food companies have to address right now. The outlook because of climate change for many key crops is not good. you know, national Geographic just came out with some numbers that say, by 2050 will have 23% fewer soybeans, 3% less wheat, and much less of a whole bunch of other crops because of floods and droughts cause by climate change. Now what does that mean For us at Unilever, we really believe it means we have to farm our ingredients differently. we call that regenerative agriculture or regenerative farming, and it's really going back to the way our grandparents farmed. it's crop rotation, it's cover cropping not leaving your land, uncovered. It's not plowing. So no-till farming, it's using fewer fertilizers. When you do that, your soil is healthier on your farm, and when there is a fluttered drought, your crops are more resilient. We're seeing it work. we're working with 10% of all soybean farmers in Iowa. We've been working with them for five years on these regenerative practices, and we're seeing that the crops of the farmers who are using these practices are more resilient. We're seeing the same on tomatoes in Spain. We're seeing the same on rice in Arkansas and in Italy. we have a 1 billion Euro climate in nature fund at Unilever, of which we'll spend a whole bunch on supporting farmers in the transition to regenerative agriculture, because again, I'm so glad you asked because this is one of the biggest challenges and honestly a threat to food security for the years ahead.
Phil:It is, and you know, if we take a look here in here in the us, probably the, the biggest impact that we've seen is the price of eggs. Now, I know in, in certain a lot of products like hellmann's, you know, eggs are a major ingredient. and you know, with, with bird flu, which continues, to be a problem, you know, the price of eggs are$7 a dozen. And for the 30 plus million people who are on food assistance programs, they can't afford eggs, which is their primary source of protein. So, you know, I applaud what you're doing in, in helping the farmers in, in trying to make our farming, whether it's animal farming, poultry or, or plant, much more efficient and working with these farmers because frankly, they need the help. They need the technology that a company like Unilever can help them with.
Hanneke:Yeah, absolutely. And you know, your point on eggs is very well taken. at our, hellmann's plant in Chicago reuse a million eggs a day. Wow. Very well aware of what's happening in eggs. and I spent, I spent time actually last week with, with the, the farmers of rose acre farms, which is the second biggest egg expire in the United States. They have zillions of chickens, and it's a huge concern. And it, it brings up some interesting discussions because, you know, we've, we've, we're very committed to cage-free eggs. So Hellmanns only uses cage-free eggs, but with the bird flu, actually having your birds in cages may be better because they're less susceptible to bird flu. So it, it really brings up some, some, you know, interesting dilemmas that will have to solve together as a whole value chain in food. but if anything, it's a very interesting time to work in food.
Phil:It is, there's no question. So if we pull back and you look in your crystal ball, what are some of the macroeconomic trends, that are shaping and impacting, the global food service industry as well as retail?
Hanneke:Yeah. so I think the big trends, you will know, right? people want to eat healthier. people are more conscious about what they eat, so they do think of the environment, although they don't always wanna pay more for that. people still want to indulge every once in a while. and we need to help them indulge. and finally, of course, it's everything digital. so the way we, we order we eat is so different from even three, four years ago. So I'd say those are the big mega trends. those are all great because they're good freedom of market. They will grow to market. I think at the same time, what we have to keep in mind in food is that there's some huge challenges into food system when you touched on some of them. But a third of all greenhouse gases into world come from the food system. We throw away a third of all the food that is produced in the world, which is an absolute crime. And then we still have a billion people who are hungry and 2 billion people are overweight or obese. So as a big foods manufacturer, we really have a responsibility to act on the trends and to grow our business, but also to be part of the solution. And that's why we have these commitments in plant-based eating, which helps on greenhouse gases, in reducing waste, and in regenerative agriculture. All really, really important.
Phil:Well, my, my homework, over the weekend is gonna be to read thoroughly the poppy global menu trends that you've got. And I applaud what you're doing, and I thank you for joining us today on Lost in the Supermarket.
Hanneke:Well, thank you so much, Phil. This was really insightful and fun.