Getting the Right Ingredients Home:
Discussing Supply Chain Disruption and Digital Grocery, with Harvest Health Foods.
In this episode, we chat with two gentlemen from Harvest Health Foods, a local, health-focused grocery chain in Grand Rapids, Michigan. Howard Atsma, Director of Operations, and Mitch Nol, Director of Information Technology & Supplement Purchasing, walk us through how supply chain disruptions due to COVID-19 are uniquely impacting the Midwest and the shift of grocery shopping to a digital experience.
Howard Atsma
Director of Operations, Harvest Health Foods
Mitchell Nol
Director of IT & Supplement Purchasing, Harvest Health Foods
Harvest Health Foods
Grand Rapids, Michigan
It’s no surprise Harvest Health Foods is the community health food store. It has been sewn into the fabric of Grand Rapids’ history since 1952. The third-generation family business with humble beginnings was started by a Dutch immigrant, Henry Diedering, who believed in bringing wholesome and healthy foods to the community. The ‘ingredients store’ has served as the ‘entry point to the bigger picture’ and weaved a connecting network of trust and community between brands, farmers, and folks who feel a sense of belonging and safety walking through their shop doors.
Further Reading
- Forbes shares how US retailers are feeling a significant supply chain strain due to COVID-19. Deloitte discusses how there’s a need to transform traditional supply chain models.
- What is the realistic future of food and how can we keep food ‘clean’ during a disaster? Michael Hamm, Visiting Fellow at the University of Oxford, gives an in-depth explanation of what each one of us can do to avoid a food crisis.
- COVID-19 will change the way we eat. According to Forbes, we’ll see a resurgence of home cooking, demand will increase for healthy and organic foods, Food Safety will be ever more important, and there will be a greater focus on eating local.
- America is obsessed with cheap meat. The New York Times discusses what our meat-eating roots mean for hotspot slaughterhouses this year.
- Read about how knowing your farmer can benefit health, environment, community, and the local economy.
Episode Transcript
Kara Kaminski-Killiany [0:03]
Hey, this is Kara from Ruminate and you’re listening to Questionable Food.
Howard Atsma[0:09]
What we find is that trends start on the coast and that’s also where the biggest demand is. So, if you live in California, it’s way easier to find organics it’s way easier to find those types of products. So, we rely on our suppliers to bring them into the Midwest and then bring them to us. So, when we’re working out of a limited number of supply houses, a crisis like we just went through, it’s really difficult to all of a sudden reach out and has those other sources.
Kara [0:43]
This episode, I’m chatting with two gentlemen from Harvest Health Foods, a local health-focused grocery chain in Grand Rapids, Michigan. Howard Atsma, the Director of Operations and Mitchell Nol, the Director of Information Technology and Supplement Purchasing, walk us through how supply chain disruptions due to COVID-19 are uniquely impacting the Midwest and the shift of grocery shopping to a digital experience.
Kara [1:10]
Thank you so much for chatting with me today, guys. Howard, you’re really an inspiring fountain of wisdom on local unhealthy foods. Mitch, I’m really excited to kind of get to meet you for the first time in chat with you today. I remember specifically chatting with Howard, maybe almost a year ago about social media and he was able to look through the comments and kind of know, oh, yeah, that person’s a regular or this person’s new. We also talked a lot about those tight-knit and really supportive relationships that Harvest Health has with its vendor partners. Overall, Harvest Health is definitely very community-driven and that’s the sense that I’ve gotten. Can you guys share a little bit about your role in the community? Also, given the current times in our pandemic, that you’ve seen perhaps changes in those relationships or how you’re community has shifted in any, if it has?
Howard [2:02]
Well, one of the things that we’ve always had at Harvest Health Foods is a community. It’s kind of a safe zone. Some of our customers don’t really have a place to talk about their health, their diet, some of their habits outside of our four walls. So when they come in, they feel kind of a relief that they can talk about things that are gluten-free, or they can talk about some natural things they’re doing for their body, that maybe they can’t with their friends or their other family members. But as we got into this pandemic, it feels like. I have customers who their spouse doesn’t allow them to go to any other store, only our store so they trust that we are doing what we say we’re doing and that we have a, maybe a bit healthier environment than a mass-market or big box store. So, the conversations are similar, but maybe a little more pointed during a situation like we have today.
Kara [3:07]
That’s really interesting. Can you chat a little bit about that trust and building that trust and what you feel gives that to folks?
Howard [3:16]
I think part of that trust is not just us, but it’s also the brands and the farmers and the folks who supply us. So, our hardcore customers know our brands, and they know where a lot of our products come from and they trust those companies. So, we’re part of a bigger, bigger picture. We’re just kind of their entry point to that bigger picture.
Kara [3:45]
Talking a little bit about the business now. Are you seeing any supply chain issues or how are those shaping out?
Mitchell Noll [3:53]
Yeah, obviously we’re well connected with other vendors that we work really well with. On our side of things, I think, we buy from UNFI, United Natural Foods and they’re obviously one of the large distribution centers. And I think for them, first off, it hit everyone. It hit all grocery stores so fast. And then obviously, everyone’s orders just exploded. So, we’re trying to order as much as we can. And then their warehouses just got depleted real quick and then obviously they need to fill those warehouses. So, we had the first couple weeks we had a lot out of stocks and they’re slowly refilling things. But I have a good friend who works for Superior Foods and they do a lot of meat and seafood and a whole bunch of other stuff and they do a lot with food service, so more restaurant-style stuff, but luckily, they’re selling a lot to us right now but they’re having issues, getting their meats in and whatnot. And we’re having issues getting meats and just because there was all sudden there’s this massive need for all these meats. And then, they go to their farmers and say, hey, you guys got to produce meat and so they’re like, yea, but you can only raise so many cows and so many pigs so quickly. And so, they’re trying to up their production, we’re trying to up our production. So, it’s just everyone trying to up production as fast as they can. And then just the supply chains just slowly, slows us down and everyone’s trying to do as much as they can, but it just, overall, it just, it’s taken a lot longer to get the product in. And we know that it’s an issue and all of our customers, I think know that too. And they know everyone’s busy, so it’s not an issue at the store level, but I think supply chain, with not having restaurants open, they’re throwing a lot of stuff out but then we can also kind of pick up on those needs where they usually sell to restaurants, we can pick up all their sales there too. So it’s kind of a lose, lose for some win, win for others. So, it’s a tough market right now.
Howard [5:51]
And to add to that, our challenge is that we have a food standard that we work by, and we’ve been maintaining that through this. So even on a good day, we have trouble getting some of the good clean products that we really like to sell. So, this has thrown kind of a curveball at that. And we’re seeing that those supply chains are trying to adjust to that, which is good. So, we’re seeing some of those things like the folks who usually supply restaurants, trying to be able to serve us a little bit differently. So, we’re trying to work with them and do work through that. But, but again, with the standards we have, we are maintaining that, so I think that’s part of that trust with our customers do. They might see something new on the shelf, but they also trust that it’s going fit our profile.
Kara [6:54]
Can you share a little bit more about the standards and how that plays out in these times? Maybe some examples of some products that can be hard to come by, but are perhaps under a little bit more strain now?
Mitchell [7:07]
Yeah, I can hit a little bit on it. Like the big side of thing is meat and produce, obviously produce, we only offer USDA certified organic produce. So, we have a lot of people saying, like, hey, we can get you all the produce you need. But for us, it’s like, we only sell organic. Well alright, we have limited skews, and we really can’t feel that right now. But then the meat side of things we try to keep it USDA Organic, if not 100% grass-fed, raised without antibiotics, without hormones and that is hard to find some meats like that, especially these days, just try to find a lot of clean meats. And being in the Midwest, too, sometimes we struggle with getting good quality meats, just because I feel like around here that the whole organic craze or grass-fed craze really hasn’t hit us yet.
Kara [7:59]
So for folks that are maybe a little bit unfamiliar with the dynamics of access to grass-fed meats based on your area and based on the consumption of your area, can you share a little bit about why it might be harder to get it in Grand Rapids, Michigan versus somewhere else?
Howard [8:16]
What we find, the trends start on the coast. And that’s also where the biggest demand is. So, if you live in California, it’s way easier to find organics. It’s way easier to find those types of products. So, we rely on our suppliers to bring them into the Midwest and then bring them to us. So, when we’re working out of a limited number of supply houses, a crisis like we just went through, it’s really difficult to all of a sudden reach out and has those other sources.
So, we have local farmers that would like to do more things cleaner, but they even have trouble finding a feed that’s clean. So, if you try to find, let’s say, a soybean, that’s a non-GMO to feed your chickens, it’s really difficult in this market.
Kara [9:11]
That’s really interesting.
Howard [9:12]
We do have a farmer who raises poultry for us. But that’s one of his challenges. He can get non-GMO corn, but he can’t get non-GMO soy, and even the non-GMO corn because they don’t raise much of it in this market, it’s just not as profitable for the farmers to raise it. So, it’s kind of a tough thing. So again, when that main supplier has everyone doubling and tripling orders for two or three weeks, they actually, our main supplier was taking our orders and then just deciding what they were going to send us. So, for the first couple weeks of this, we didn’t know what was going to show up. We might have gotten 25, 30%, maybe 50% of our orders. That’s starting to clear up now. If you walk through our store, you’ll see, it looks like we have full shelves. We of course know where the holes are. But it’s much better now. But it has been a real challenge.
Kara [10:25]
You talked about it kind of like getting better over time. Depending on what data sources you’re looking at, we might be in this scenario, and through the summer, some even say, it’s not going to get back to normal for a year or two. Do you think that the supply chains will adjust quickly? Or do you think that it’s a little bit bulkier of a system that might take a longer period of time or what are your thoughts on kind of that rebound?
Mitchell [10:52]
I think it’ll adjust a little bit quicker. At the very beginning, I think we had so many people that were so scared right away, was just like, oh my gosh, we’re in a pandemic, what do we do? No one knows how to act. And so, then you’re just trying to form your own opinion. But then also you read everything on the news. We had a couple of supplement companies email us and be like, we only had 10 of our 150 employees show up at our warehouse. So, we’re not going to be able to ship, for a week and it’s like, wow, like, what do we do? How do we work with them to get our product? And after a couple of weeks, all of a sudden all of these people start to come back and like, okay, nope, I’m fine. We’re fine. We’ll work through this together. So I think that initial warehouse closing down, even some of the manufacturing plants closing down, I think they’re all starting to come to light and everyone’s starting to come back to work and I think it’ll just slowly trickle effect. Everyone starts to come back to work, it’ll just pick up faster and faster and faster. And we’ve already seen it now we’re going back, we’re having close to normal shipping rates of some of our supplement companies and our grocery distribution companies, we are getting a higher fill rate than we were. I mean 30, 40, 50% is not ideal at all. But now we’re getting back up to the 60 and 70. And I think just as everything starts to open up, just the whole supply chain will increase and start to run a little bit better than it was.
Howard [12:24]
To add to that, I think where we’ll see more long term are some of the seasonal type products, things that we can’t grow year-round, some of the herbs, some of the things that we always see seasonal shifts, I think this year, we may just see longer stretches where a seasonal item might be out of stock, but I see our vendors all reacting where they can and certainly not living in fear of this becoming a long term problem.
Kara [12:58]
We’ve chatted about how there are two trends happening, the stockpiling and then also the increased eating at home if you look at the data that’s like Nourish Organic saw 30% increase in March but also, Prego pasta sauce saw 52% increase. Something that I thought was interesting was Yelp released a coronavirus impact report that showed searches for CSA is up by 579%, which is quite significant. And I think kind of also indicative of perhaps a stronger focus on local, as you hear in the news about bigger supply chains breaking down. Do you guys think that the current crisis might impact how people eat in the long term or maybe change people’s minds that were thinking certain ways about what they eat?
Howard [13:47]
I have an opinion about that. I think that there are families who have not spent a lot of time in their kitchen in years and are rediscovering it and finding out that you can make a meal and you can have some family time around the table. So, I feel that that’s going to shift people to buy more groceries and maybe kind of appreciate that family time or time actually preparing the food and putting it on the table. So, I’m hopeful that we’re gonna see a trend on the grocery side that’s gonna stick with us.
Kara [14:27]
What are your thoughts, Mitch?
Mitchell [14:29]
I have a whole bunch of friends and know we’ve talked about all this. A couple of my friends they eat out a lot, and not being able to eat out they’re like, man, we’re cooking at home but then all sudden, they talk about, I made salmon, I made burgers, I made brats, they’re talking about all these things that they’re making at home and they just never used to do that in the past. And so, I’m hoping a lot of those families do hold on to cooking in the home. We call ourselves more of the ingredient store and a lot of people are shopping and they’re buying ingredients and they’re baking and cooking and preparing meals. And I do hope that does continue throughout the summer and into next year and whatnot as people see like I don’t have to eat out all the time and I can make a really, really good meal at home. And I don’t have to go sit at a restaurant for an hour and wait for it.
Kara [15:18]
Howard, you and I have chatted before about the chain of behavior change. So, we’re talking here about how people are eating more at home. Do you have thoughts and Mitch do you have thoughts as well, about how just the sheer eating at home might lead more toward people thinking about and purchasing and consuming the products that you guys specifically sell that do focus more on health?
Howard [15:42]
Yeah, I would say that we’re gonna see a trend. You mentioned something about CSAs when it comes to food and quality, I think people realize that if they can buy food that’s close to home, you tend to improve the quality. So, I believe that if there was a trend in, let’s say, an uptick in CSAs, I think that would be related to freshness, knowing your farmer, you can drive by the farm and you can visit. I think that’s a really positive trend.
People eat out a lot. One of the things you always look for is quality. Well, when you realize that you can buy really high-quality food and prepare it and support your neighbor at the same time, I think that will be an outcome of this whole pandemic.
Kara [16:33]
Completely. Let us hope, but I think the trends are heading in that direction too. Let’s talk a little bit about the change in the grocery buying experience, Harvest Cart is an online ordering system that you guys launched last year. When was that?
Mitchell [16:47]
Yeah, we did, it was more September, we kind of did like a soft launch, like, hey, we’re gonna put it on our website. We’re not going to tell anyone about it. We’re just gonna see how it works. We’ll check Google Analytics and see who goes on there and then we really kind of pushed it more November, December, when we actually started to push and start advertising Harvest Cart. So yeah, it was still pretty fresh to us.
Kara [17:10]
Tell me a little bit about watching those Google Analytics during your stealth mode and what happened come March?
Mitchell [17:19]
When we first started, we kind of laughed because a lot of the Google Analytics were all coming from Hudsonville, and that’s where our HQ is, that’s where my office is. So mostly, it’s us going on there checking things in our employees checking things. But then as September kind of rolled through, and got into October, we started seeing a lot more people go on there. And then January and February we’d have three or four a day kind of trickle through. And then once March hit, it went from three, four days, to we were doing 80 a day, and at just one store and then all sudden it was like we’re doing, 120, 140 a day. 150. Yeah, and it just got insane. And so, then we had to kind of pump the brakes and say, alright, well, we also have to look at our customers in the store and still need to be able to provide them service. So, we started to limit the number of orders per window pickup time. And that has definitely helped out just with store-level stress as well as just the overall impact in the stores. We were very fortunate and blessed that we, back in September, we kind of pushed this through and we had an idea how it ran and everything and now it’s a very well-oiled machine as you could say.
Kara [18:30]
Let’s chat about any impacts on labor, your staff, during this crisis.
Howard [18:35]
Yeah, we found that as this pandemic progressed, we had employees who had issues with, and I’m sure you guys can relate to this, everyone has something in their life that’s related to this pandemic. So, as employees, everybody had something, they had an elderly parent, they had a young child, they had a schoolchild, they had multiple generations living in the same house. So, when you work in a retail establishment, we’re pretty vulnerable. We’re putting ourselves out there and so, we had to work through each of these individuals’ situations. So we were, I’d say losing, not really losing people, but we were allowing, hey, you need to take care of that. Give us a call when you get that straightened out, or when you feel comfortable, and come back to work. So, as that ramped up, we were also losing our labor. So, we’re operating right now shorthanded at all three stores so as that was happening, we said, hey, we need a little bit of a break. So, by reducing our hours, we kept our staff coming in at the same time, we just allowed them time to clean, to reorganize a store, to put groceries out, to pick Harvest Cart orders. So they have a little bit of time, I’d say it’s called downtime, where they don’t have the phone ringing and customers there. So that was really helpful on the stress side of our staff to be able to come in and say, normally come in like eight o’clock, we opened at nine, now it’s coming at eight, and we have till 10 to kind of get ready, and then off we go. So, it’s been a challenge for everyone to try to pick up that extra business, not business, necessarily just, activity level and do it and still be able to go home at night and be a dad, or a mom, or a sister, or brother, or whatever you had to be. It’s a balance that’s been a real challenge.
Kara [20:50]
I imagine that they’re all thankful that it’s a balance that you are willing to take on. I know that’s not the case for everyone.
Mitchell [20:59]
Yeah, we’ve had a lot of employees come in and say like, we’re not going to close, are we? We’re not going to close, like, no, absolutely, like we talked about community. It’s like, no, this is when our community needs us to act the most. This is when we need to be here for everyone that walks in the door, we just need to be a smiling face and our employees have just been absolutely phenomenal through all this. Like, everyone’s happy, most days, everyone’s happy and everyone’s trying to get through this together. And yeah, just to be that person for those people that walk into the door and are very scared or nervous or something and just to see us smile and be like, we can help you through it, we’ll all get through this together. I think it’s been a blessing.
Howard [21:41]
Absolutely. We have experienced over the years people who aren’t well, and they shop with us, and not everyone, when you’re not well, it’s hard to, I mean, when you interact with other people, sometimes it’s their illness or their fears, or their whatever comes through. And it seems like right now, everyone has the opportunity to be fearful and all that. So, we continue to try to be that safe spot for people. But that is a bit of a challenge. So, we do get some occasional customers who might be unhappy with us and give us some feedback. But then, on the other hand, we have some awesome customers who, in fact, just this week, we had a customer order pizza and send it over to one of our stores because they were just grateful for us being there. So, one, we’re trying to be there for the folks who are stressed and who have issues, but then we also just really appreciate the folks who come in and just love us and they’re very expressive. They let us know how much they appreciate us and that so that’s what keeps us going. I think Mitch related to we’re here for the community and we hear that it comes through really strong from those customers who just appreciate the fact that we are here, we have good healthy products for them, and we’re not going anywhere.
Kara [23:21]
Well, I can’t thank you both enough for spending time chatting with me today, and also, thank you for being that rock in your communities. That’s really important work.
Kara [23:36]
To learn more about the history of Harvest Health Foods, follow the link available in this episode’s description or visit them at harvesthealthfoods.com.
