Thrive Market, an LA-based e-commerce company, focused on getting healthy foods to customers across America at cost-effective prices, is going zero-waste. But can a company of its size and its nature, really get rid of all its waste?
Founder and Chief Strategy Officer, Gunnar Lovelace, chatted with me about the realities of building a zero-waste business, particularly one that requires shipping, packing materials, and large warehouses to stored hundreds, if not thousands, of SKUs. He's keen to point out that the current capitalistic system is not working for the planet or even for the customers — who live on the planet and thereby are affected by the dirty water, polluted air, and destroyed ecosystems.
“It’s tough to find a business without some form of sustainability messaging emblazoned on their platforms or packaging,” he said in a recent interview in LA. “Unfortunately, the term sustainability has been co-opted by some of the most insidious corporations on the planet, and despite all the marketing-speak around sustainability, according to the EPA, more than 75% of greenhouse gas emissions from many US industry sectors still originates from our supply chains.”
So Thrive Market set out to rethink its supply chains and has completed the zero-waste challenge in two of its fulfillment centers. Lovelace explains the challenges and roadblocks faced, but also offers advice for other businesses looking to explore a similar path.
Esha Chhabra: Gunnar, what does zero-waste mean to you?
Gunnar Lovelace: Zero Waste is a great beginning for us, it's a journey we're embarking on to fully understand our impact as a business and rapidly shift our practices to eliminate those negative impacts. But given the scope of the challenges we face as a species, simply eliminating negative impacts is not enough. We need to design businesses to have a positive impact - to become regenerative.
Capitalism has proved incredibly efficient in getting products and services distributed in a highly complex global economy. But there are all sorts of negative externalities that we don't often understand, measure or discuss. There's a tremendous opportunity for emerging challenger brands to intentionally build positive externalities into their supply chains, and connect their increasingly sophisticated consumer with those positive externalities, to be rewarded in the marketplace for doing the right thing for our planet.
What were your first moves to becoming zero waste? Where did you start?
One thing we've heard from the beginning from our members was a deep concern about the impact their order from Thrive Market has on the environment, particularly in terms of the amount of packaging in each shipment. Our teams have worked tirelessly on this front, reducing the amount of packaging in each box by nearly 50% through improved efficiencies and training. We've also removed nearly all virgin plastic from our packaging, so those can be processed through curbside recycling programs - plus we've added a ziplock to all green-plastic to encourage our members to reuse their bags. Plus, 99% of our packaging is made of 100% post-consumer recycled packaging - even the tape we use is made from paper so it can be processed through recycling streams.
When did you start this process?
As an activist and environmentalist, I've been concerned with environmental responsibility my entire life, and it's been a key focus area for us since before we launched the business. We've gone to great lengths to ensure that 99% of our packaging is 100% post-consumer recycled paper and all of our printing uses non-synthetic plant-based dyes. We've brought that same level of intention to our product sourcing, only working with brands that share our values and carrying products that not only meet but exceed our strict environmental and ethical standards.
Give me an example with one of your products, how does zero-waste translate into a product?
We've also brought more than 280 Thrive Market branded products to market over the past 24 months. Each of our house-branded products has been created in partnership with the most innovative agricultural producers around the world, to drive resources into value-aligned supply chains. When we set out to create an organic, nutrient-dense bone broth, for example, our goal was to produce an incredible product while also working to eliminate food waste within our supply chain. So think about this, 30% of the 130 billion pounds of food America wastes each year comes from meat, poultry, and fish.
What have been the roadblocks? This surely couldn't be easy.
No, not at all. Given we're an early stage startup, having just celebrated our third year in business, we need to be extremely sensitive to extra costs - particularly as we're a low-margin business shipping hundreds of thousands of boxes each month. Any business focused on building positive externalities in their supply chains, will be confronted with institutionalized cheap, easy and dirty solutions, as opposed to more thoughtful, deliberate and environmentally responsible solutions. That may be more expensive.
That's the great dynamic tension, whether you simply choose the easy thing or invest the time and energy to take the extra steps needed to do the right thing. Many organizations in the grocery space us styrofoam, for example, and we knew we couldn't perpetuate that practice given everything we know about styrofoam. So we took steps to invest in the most ecologically advanced packaging in the market because we knew it was the right thing for us as a business, for our members and for the regenerative future we hope to help create.
Is this why more companies are not looking at such models? Because of cost?
Yes, it’s expensive and difficult. The institutional supply chains created by traditional capitalism, by their very nature, favor the lowest cost of doing business. But the lowest cost of doing business is artificially inexpensive given all of the unmeasured negative externalities. What's the true cost of a clean gallon of water? Or polluted water system? It's nearly impossible to put a price tag on nature, or quantify the true cost of a unit of pollution but these values, even in the abstract, aren't currently applied effectively in the marketplace.
Bernie Madoff is the admitted operator of what's described as the largest Ponzi scheme in American history. I would argue that the mechanisms and systems created by capitalism 1.0, of which we are all agents and enablers to varying degrees, is the greatest ponzi scheme in the history of our species - given how we're not only stealing resources from future generations but processing those resources using techniques we know to be toxic.
Sustainability or environmental responsibility is not enough. We need to go further to help create a regenerative economy where we not only neutralize all negative impacts but create positive externalities to create a better world for future generations.
What is the cost to the company to reduce waste? Assuming these recycled packaging materials cost more, correct?
There are two main buckets of expense, hard costs and time. Often time costs are more expensive. Institutional supply chains are so easy and convenient, particularly in a startup environment where financial and human capital are scarce. So it's incumbent upon us, if we're really going to build businesses that represent the full potential of our values, that we take the time to evaluate all the impacts our businesses have and think through solutions to be better. The truth is that adopting the most rigorous environmentally responsible solutions is not only the right thing to do, but the smart thing to do. In the face of intense political dysfunction, as services become increasingly commodified, consumers are awakening to the real power they can wield by voting with their dollars, supporting brands that represent their values and leaving others behind.
Going back to the issue of shipping, are e-commerce businesses wasteful inherently because of the process of packaging and shipping? Any way around that?
A lot of people don't realize how many intermediaries there are in traditional grocery retail, and the massive carbon footprint created by all the steps your food takes from farm to plate. There's an MIT Study that explores how shopping online in many cases has less impact than traditional brick and mortar, particularly when the online alternative has made significant investments in environmentally responsible practices similar to ours. We're currently working on our own white paper to explore this topic in more detail, and compile our experiences and learnings as we endeavor to become a Zero Waste organization so other business can learn from our mistakes as they join us in creating a more responsible future.
In the process of going zero-waste, what surprised you, any new learnings?
Our process has been a mixture of more complex tech-driven processes coupled with relatively low-tech waste stream management and choreographed human processes. An example of a creative solution, that's not necessarily sexy, is our fulfillment teams are repurposing broken pallets that can't be reused as firewood.
Another exciting learning for us has been around carbon offsets. While carbon offsets are an imperfect way of mitigating emissions we've not yet been able to reduce, we believe it's an important tool in our journey. One of the traditional (and valid) critiques of carbon offsets is that they're opaque and nearly impossible to trace. We wanted to create an offset program that was fully traceable, so we've worked to develop a domestic carbon offset program through a conservation easement to both offset our emissions and protect a vital habitat. This was so important for us both in terms of authentically delivering on the environmental responsibility aspect of our mission and ensuring our members feel a connection to the forest they're actively engaged in protecting by being part of our community.
Who do you turn to learn more about how a company reduces its carbon footprint? Any people, or books where you draw inspiration or acquire knowledge on these issues?
I went to school with the children of the Patagonia family, and have been constantly inspired by the work Patagonia has done over the past thirty years, such as creating the organic cotton industry, using recycled plastic bottles to make fleece or many revolutionary responsible innovations. One of the core areas of design inspiration comes from permaculture, the idea that you can use something that was previously a waste product as an asset if intelligently and responsibly designed to create a positive impact.
