Regulating Food Safety: Internet Sales & Emerging Technologies

VANESSA LINDSAY PHASE 2 CONSULTING, INC. “ The DISRUPTOR Generation ”

Millennial consumers, and start up entrepreneurs, have changed the rules and caused major disruption in nearly every sector including the food industry ONLINE FOOD SALES Direct-to-Consumer Delivery Model

“DRAMATIC ONLINE-ONLY RETAILER GROWTH DRIVEN BY  Early Pioneer: FRESH DIRECT, NY MILLENNIALS: Today, 1 in 4 shoppers is using online-only retailers,  Emergence of and Fully an increase of more than 50% in 2 Cooked Meals Brands such as BLUE years … nearly half of Millennials are APRON, PLATED, HELLO FRESH, CHEF’D, shopping online-only retailers, almost PURPLE CARROT, SUN BASKET, and 80% higher than just 2 years ago” .

(Source: FMI US Grocery Shopper Trends 2017) REGULATORY FOOD SAFETY

 Many process under FDA and local regulatory authority and are subject to compliance with FSMA  Operate USDA retail exempt facilities, but use USDA Source materials for meat and poultry  Producing Fully Cooked Meals or Meal Kits, Reheated or Fully Cooked by Consumers  Meals include Entrée Protein and Side Dishes, Meat/Poultry/Seafood/Egg/Vegetarian/Allergen-Free Options tied to user profiles  CCPs: Receiving & Storage Temperature, Cooking, Chilling, Metal Detection, Label Verification (FDA Food Code Guidelines)  Generally Short Shelf Life MEAL SHIPPING METHODS

 Meals Ship Via Ground Carriers such as Fed Ex, or through a combination of refrigerated freight and Ground Carriers  Shipments: 1-2 day time zones for delivery  Secondary packaging: recycled denim insulation, styrofoam, gel packs or dry ice in corrugated shipping boxes  Packaging integrity: tested through a series of practical verification tests and third party validations using International Safe Transit Association (ISTA) protocols for winter, summer (7E), and extreme heat profiles.  Shipping temperature studies: validate meal temperatures remain at 40F or less for the duration of transit time under worst case scenario conditions SANITARY DESIGN & PRACTICES

 Raw to RTE Separation, Refrigerated Processing environment  Color Coded Cleaning Equipment  Color Coded Uniform Policy, Specialized workers dedicated to Sanitation functions  Teams dedicated to food safety and quality assurance  Use of Disposable gloves, sleeves, and aprons as well as E3 and D2 alcohol spray sanitizers for hands and surfaces  New Construction Projects: Stainless Steel seamlessly welded floor drains and drain cleaning program  Cementous Urethane flooring and IMP Panel wash-down walls TESTING PROGRAMS

 ATP Surface – Sanitation Effectiveness Verification Daily at Pre-Operational Inspection  ALLERGENS- 3M Clean Trace at Product Run Changeover Daily  AIR SAMPLING – Semi annual testing for TPC, Yeast and Mold  POTABLE WATER – Coliforms, E.coli, semi annual and after any major plumbing projects  PATHOGEN MONITORING – Environmental 4 Zone LISTERIA SPP.  SHELF LIFE / R&D – Basic Spoilage Organisms & Challenge Studies ADVANTAGES IN THE FOOD TECH SECTOR

 Rapid Recall Ability due to the unique direct access to consumers’ individual contact information, allows for speed and accuracy  Customer facing technology platform can save user profiles containing nutritional preferences, and dietary/allergy restrictions  Food Tech companies are generally investment funded, allowing for hire of high-level Food Safety professionals early in their development as companies  A drive for sustainability and environmentally-friendly products and packaging FOOD SAFETY: Getting Up to Speed Quickly

Incubators: Food Investment Partners Regulations & Third Innovation Centers & Consultants Party Audits

& Social Groups • and • FSMA – New Food Regulations require food start-ups to get up • Food Works, Brooklyn, NY Investment Partners provide resources to hire senior leaders to speed with Food Safety • Hana Kitchens, Brooklyn, NY early on Requirements quickly • Chobani Incubator, Manhattan, NY • Food tech start ups meet • GFSI – Third Party Audit • Rutgers University Food requirements for retail clients Innovation Center South, consultants for facility Bridgeton, NJ development, food safety, drive demand for Food Safety and operations through Standards • Food Tech Meet-Up various channels $TRATEGIC INVESTMENT$ OTHER FOOD TECH BUSINESSES

 Amazon: , Amazon Pantry, Amazon Fulfillment, Amazon Third Party Sellers  Dry Food Products: Nuts.com and Thrive Market  Pet Food: Chewy.com and PetPlate.com  Finless Foods and Memphis Meats which produce animal protein from cultured cells  Ocean Hugger Foods, Impossible Foods, Beyond Meat & Good Catch Foods producing plant based Meat and Fish Alternatives  The Cannabis Industry: producing non-hallucinogenic CBD Edibles  Alternative Insect-based Protein sources: EXO Protein Bars, Hargol, Protix Q & A