Giving Tuesday is a time to highlight ways to give back to the community, which is an important part of our mission all year long. In fact, did you know a portion of every sale goes to help provide nutritious lunches for low-income children through the non-profit A Better Course? Since 2013, we have donated 2% of our cash flow to A Better Course, but we don’t stop there. We also send bars to victims of natural disasters including hurricane and fire victims. So, every time you purchase ZEGO products, you invest in better nutrition for low-income kids and provide safe, disaster relief snacks for people with dietary restrictions. Giving back is something we are extremely passionate about, which is why we wove this into our legal structure.
A Better Course strategically selects and designs on-the-ground programs, conducts research, analysis, and advocates for improved nutrition for low-income children and families. Specifically, we support A Better Course’s work on improving access to healthy foods through public programs such as school meals, CalFresh, and making that food safer by advocating to improve transparency in our food system regarding allergens, pesticides and GMOs.
We are grateful to our partners and funders, without whom the work would not be possible.
That mission is also why every year we do a master-case giveaway of snacks to one lucky school. It is our biggest and favorite giveaway of the year.
Whether your child has food allergies, or attends a peanut free-school, having snacks that are available to every child regardless of allergies is so important. This fall, the winner was Hockinson Middle School in Brush Prairie, WA! We interviewed the school counselor Jessica Ambrose to learn a little more about their school. In the middle school, they don’t prohibit allergens, but they do specifically flag every child with food allergies so that teachers and staff are all aware of a child’s food allergies.
Jessica’s family has several food allergies as well, which is why she really understands how important it is to provide safe snacks. In fact, she keeps a basket of fresh fruit, and a drawer of safe snacks so that kids are able to get something good for them to eat any time they are hungry. For some of their students, they rely on these snacks to make sure they get enough food for the day. Since the school does not have funding for something like this, she and other teachers fill up the snack box out of their own pockets. We were so happy to be able to give her a boost with the master case!
At Hockinson, they try not to use food (especially candy) as rewards. Instead, they use a token system with a store for them to earn rewards. This way every child can be included. They have several students with peanut allergies and other allergies, as well as students who are vegan or diabetic.
Jessica said “We love ZEGO snacks for kids who have food allergies or diabetes since they are low in carbohydrates and have no added sweeteners. These are the perfect snack for our school because they work for all of our kids.”
How to Make Sure You Don’t Miss the Next School Giveaway
Do you want your school to be the next winner? Make sure you sign up to get our email updates and we will be sure to let you know when we do the next school giveaway! Then all you will have to do is nominate your school to win, and get all your friends and family to nominate them too. And maybe your school will be the next winner!
When you sign up, you will also get our Mix-In Recipe Book for free! Full of fun ideas for you to try.
Allergy friendly lunches can be a challenge sometimes. And when it comes to school lunches, sometimes you have to think about allergies that affect the whole school, such as if your child goes to a peanut free school (even if they themselves don’t have nut allergies).
Here we are to the rescue with some fresh ideas for you!
Allergy Friendly Asian Inspired Bento Box
What is in this box:
This is a fun box with some different items that you might not think of to put in a lunch every day. The nice thing is you can pack one for your child and one for you too! The spicy sweet of the Lemon Ginger bar is the perfect addition to all these flavors.
It is naturally vegan, nut free, and wheat free. You can easily make it soy free by substituting tamari with another sauce that you love. Sushi can be a fun activity to make together as a family the night before, and can be made with many different types of ingredients.
An important thing to double check with these foods is for fish and shellfish. Sometimes those ingredients can show up in something like kimchi, so check that it is a recipe that works for your dietary needs. The other good news is that this box is stocked full of probiotics and antioxidants!
If your child is not a fan of traditional sushi, then you can make “fruit sushi” by rolling out a ZEGO fruit bar for the seaweed, adding sweet sticky rice, and pieces of your favorite fresh fruit. Mango or something tropical would be especially good.
Nut Free Bento Box Idea
What is in this box:
This is not only nut-free, but also gluten-free and vegan. If you don’t need to be gluten-free, you could easily swap out your favorite pretzels and bread for the gluten-free versions. Peaches and cherry are flavors that go together well, and the kale chips add some nice crunch and veggies.
You can make the kale chips yourself, or buy your favorite allergy-friendly brand.
What is also nice about this combination is several protein sources without meat, dairy, or eggs.
While sandwiches are a staple in many lunches, you can also twist it up for some variety. Consider putting Sunbutter and Mix-Ins on a rice cake, or cutting up your favorite ZEGO flavor with toast and any other spread – like this delicious avocado toast!
Dairy Free Bento Box Idea
What’s in this box:
Most of the boxes in this list are dairy free, but this is proof that there are lots of ways to get protein without dairy! The mini-muffin can be gluten-free if you want. And if you can’t have soy, you can swap out the roasted edamame for a handful of Mix-ins, or dried peas or lentils.
Lime and sea salt make the beans a little more interesting. You could also add salsa to the beans if you want a bit more spice.
One of the great things about ZEGO bars is that they can be slipped in a lunch box in addition to a full bento box in order to get in a little more nutrition in an easy grab package.
Soy Free Bento Box Idea
What is in the box:
There are a LOT of flavors going on in this box, which is why a Sunflower Date bar seemed like a good fit. It adds more protein with a nice smooth taste, that goes well with the beet hummus and crunchy veggies.
If you haven’t started experimenting with your hummus choices, you should give it a try! There are a lot of different flavor options. And the crunchy sweet of the raw sweet pototo slices is a good way to add variety to the normal dipping vegetables that you might think of.
If you hae corn allergies, you can always swap out the corn chips for rice cakes, pretzels, or whatever other crunch dipper you like.
Egg Free Bento Box
What is in the box:
- Multi-grain tortilla chips
- Grape tomatoes
- Snap peas
- Three different kinds of hummus
- Sunflower Date ZEGO Bar
Here is another twist on hummus and chips. This one includes multi-grain chips, a couple different veggies, and siracha carrot, white bean, and black bean hummus. The Sunflower Date bar adds some subtle sweet to the box.
Again, there are always other chip choices to suit your needs, and get creative with trying different types of veggies as a dipper!
Wheat Free Bento Box
What’s in this box:
- Apple Cinnamon Mix-ins
- Spinach patties
- Dairy-free yogurt
- Hard-boiled egg
- Black grapes
This box is almost like a brunch box! The spinach patties are almost like hash browns, and the yogurt is ready for the Mix-ins to be added for an instant parfait. It has a lot of variety in nutrients and a high protein content. If you need to skip the eggs, the Mix-ins still provide a high-protein alternative. Maybe include both flavors if you want to make it egg free!
Pick whatever type of yogurt meets your dietary needs, and add some probiotics to your meal in the process.
Bonus: Allergy Friendly Snack Ideas
Sometimes all it takes to liven up a lunch or snack is to present it in a different way! For example, make fruit kebobs with ZEGO bars, or intermingle the bars with fresh fruit on the kebob. You can also use small cookie cutters to cut out shapes from your bars to give your kids a fun treat to look forward to.
Which of these ideas are you going to try?
You may have seen a lot in the news about glyphosate lately, the most common herbicide in the world, used in products like Roundup by Monsanto. Earlier this year the World Health Organization issued a strong defense of its classification of the chemical as a “probable carcinogen,” and there is a landmark case in the news this summer in California (one of 4000 pending cases) concerning a school groundskeeper who claims glyphosate caused his non-Hodgkins lymphoma. Yikes. Does exposure to glyphosate cause cancer? Did Monsanto know about the risk and deliberately mislead the public? How much exposure is dangerous?
While the U.S. courts and scientists consider these questions, we believe consumers should be able to decide for themselves if they want to eat foods that have glyphosate in them. Problem is, very few food companies test for the chemical and virtually no one releases that data to the public. So, it’s most likely that not only do you not know if it is in your favorite foods, neither does the company who made it for you.
At ZEGO, we believe in giving consumers control over what they eat. We established our Z-CODE food safety system combining lab testing, transparent labeling and batch level communication through packaging technology to inform their choice. Before going into that, let’s learn a bit more about glyphosate.
Why Is Glyphosate a Concern?
Some studies have found glyphosate may be correlated with a number of health problems from endocrine disruption to shorter pregnancies and lower birth weight of infants to celiac-type symptoms in fish. Add that to the numerous cancer lawsuits that claim Monsanto knew the chemical was a health hazard and hid it from the public and that has a lot of people concerned. The problem is, that if you are a consumer who wants to limit your exposure to this chemical, your options are limited.
Can You Be Glyphosate-Free?
Can you live a glyphosate-free lifestyle? Probably not, sorry. Avoiding glyphosate is not as simple as staying away from herbicides on your yard. Studies have measured it in rainwater, air and soil samples. The other studies found it in surprising amounts in a number of everyday foods that you may have in your cabinets at home, ranging from organic coffee creamer to cereal to chips. It may have been used on the cotton in your clothing. But the problem is not just how commonly used it is, it is that you do not have access to data that would tell you if a product has glyphosate residue in it and how much. That is what we at ZEGO would like to change because we believe you have the right to know what is in your food, even if it is not required to be stated on the label.
How Is ZEGO Making a Difference?
If you are a long-time customer, you know that in addition to producing our products in a top eight allergen and gluten-free facility, we also send out each batch for independent lab testing for peanut, soy, dairy, and gluten. We connect that data to the product in your hand through the QR code on the package. Building on that, we are now periodically testing for glyphosate and posting the results as well. With one scan, you can see all five test results.
You may have heard of blockchain in regard to Bitcoin and crypto currency. Our patent-pending Z-CODE system is a tailored blockchain, adapted to be easy and quick to execute for the company and more relevant to most people on a daily basis. Its a system for collecting and distributing food safety data that reliably provides information about a packaged food batch to the consumer. For the company, the system provides reliable data on and accountability for the purity of the ingredients it buys and its factory’s manufacturing process. There is technology involved in the testing and communication system but no encryption as with Bitcoin. The time and expense of encryption would make it untenable to implement this system in the short term and possibly at all. What is revolutionary about ZEGO’s Z-CODE system is that it can be replicated in a matter of months by any company that cares enough about its consumers, its products, and its reputation to do it.
And, if more companies adopt the Z-CODE system, we will have a network of data that, together, could serve as a measurement of crop health across the food chain and serve as a roadmap for improving it. It is in the sharing of this data among companies where the encryption would be most helpful because a company may not be willing to publicly share undesirable test results unless it is assured it cannot be linked to the data. Otherwise, it will keep the information close to the chest and work out the problem internally. But it is the collection and analysis of the aggregate data that would be most helpful to all of us, answering questions like which supply chains for certain crops have more glyphosate than others? Is a particular supplier selling ingredients that, known or unknown to them, is contaminated with ground peanuts? Which suppliers are passing off ingredients fraudulently labeled non GMO and organic?
Another beauty of our Z-CODE system is the benefits for consumers and companies start immediately for verifying our suppliers’ organic and non-GMO certifications, which are particularly vulnerable to fraud. In our first round of tests, we found high levels of glyphosate in one organic spice we wanted to use. We reported the test to the supplier so they could fix the problem, and then switched to another brand whose product tested clean. Imagine how quickly we could clean our supply chain if 10,000 companies had a similar story to tell? So while the U.S. courts, politicians and scientists debate the safety of glyphosate and business executives and technology experts grapple with encryption and whether it can be built into the food chain affordably, we hope other companies act now and start testing and reporting like we do.
We have reason to be optimistic! Scott Elaine Wright-Case, co-founder of a successful food venture capital fund called VMG, applauded ZEGO’s action as, “a bold move that brings blockchain verification to packaged food. This is exactly the type of innovative transparency consumers and investors have been clamoring for in the clean food movement.”
How Can You Minimize Your Exposure to Glyphosate?
Unfortunately, right now, there are no regulations requiring companies to test or reveal their testing results for glyphosate. But there are things that you can do.
- Email the companies you buy most often from and ask them for the same blockchain testing and transparency ZEGO provides for glyphosate, allergens, and gluten.
- Buy organic and non-GMO certified products when you can, particularly if they are made from wheat, corn, cotton, soy, canola oil and sugar beets. One 2014 study by the Journal of Environmental Research showed going organic for a week reduced exposure to chemicals by 90%.
- Use the “dirty dozen” list for produce while you shop. This list by The Environmental Working Group measures a number of chemicals. Keep it on your phone.
- Read more about glyphosate at The Detox Project and about how you can get tested to find out how much glyphosate you have been exposed to. Soon they will also have an in-home test you can use on your food and water. Share the information with friends and family (in a nice, not scary, not preachy way).
- Contact your representatives at the state and federal level. Let them know that you care about labeling transparency and want the FDA to release its glyphosate findings.
- Buy ZEGO products! We know, we know, but we had to throw that in there. We are a small independently owned company, and your support is critical to our success.
- Talk to your local store. If store managers know that you care, they will pay attention.
The biggest boost to the non-GMO labeling movement was when Whole Foods heard from so many customers concerned about GMOs that it required all its vendors become non-GMO certified. The level of consumer awareness is not quite there yet with glyphosate, but we will get there faster with your help!
Thank you to Food Democracy Now, The Detox Project and Environmental Working Group for their reporting on this issue, much of which we used in this blog.
Colleen Kavanagh is the founder and CEO of ZEGO. After a career in public policy working to improve nutrition for low-income children, she started ZEGO to provide superfood based snacks for people who need to restrict their diets to be healthy. ZEGO is a certified B Corporation, and is working to bring transparency to the supply chain to improve food safety and nutrition for all.
Surviving summer with food allergies brings up some unique challenges, but it also can be a time for some amazing family fun. I want to share some of our favorite allergy-friendly summer camps, tips for handling playdates with friends who might not know about your child’s allergies, and ideas for recipes and summer fun activities! And, read on to find out how to enter ZEGO’s great summer fun giveaway starting June 21 with $250 worth of ZEGO and other allergy friendly products!
For many people growing up, summer camp, or sleep-away camp, is a summer tradition, but what if you have food allergies?
The good news is that there are some camps that cater to people with food allergies, the bad new is that there aren’t a lot. We donate bars to camps each year including Camp TAG and Blue Spruce and hope even more allergy safe camps will open. FARE also has a great list available to help you find an allergy safe camp near you. But realistically, most of you will need to see if you can make a regular camp allergy safe for your child.
The key is to really understand how the camp handles its food. Some people will say, “Sure! We can make food for food allergy kids,” but they don’t understand what that really means. Before sending your child to camp, ask them questions about how they handle allergies. Here is a list of questions to get you started:
- What percentage of your campers have food allergies?
- Are your cooks and all kitchen staff food allergy trained? If so, how?
- What are your protocols if a child does have an allergic reaction? Has that ever happened at your camp?
- What is the policy about other campers bringing snacks and food with them?
- Who keeps track of which child has which allergies at the camp? How do they manage that information?
- Are you ever in places that are not accessible to mobile signal for hikes, etc.? What are your protocols for that?
FARE has great resources on how to make camp safe, so be sure to check their website for more suggestions.
Trips to the Beach, Hiking, and other Outdoor Adventures
Another part of surviving summer with food allergies is being prepared with healthy options so you can enjoy all the new activities. You’ll need things that won’t get crushed in your pocket or backpack as well as items that will turn your “free continental breakfast” from a source of sorrow to a source of excitement!
ZEGO bars are great for hiking and water activities because of their water-tight packaging and un-crushable soft texture. They also have the advantage of not melting on hot days. If you are looking for an allergy safe alternative to traditional trail mix with wholesome organic ingredients, then our new Mix-Ins have you covered! Mix-Ins are our brand new product that is a delicious blend of seeds and dried fruit. They are free of the top 14 allergens, gluten-free, vegan, and make an excellent grab and go option. Our packaging is corn-free as well. If you are part of a scouting organization, or other group activity, suggest Mix-Ins instead of trail mix for those groups as well so that you don’t have to worry about cross contamination. It is even priced the same as traditional organic nut-based trail mix, so it should be an easy switch for everyone to make!
If you have dietary restrictions, Continental breakfasts can be a frustrating way to start your day. Turn that frown up-side-down by bringing Mix-Ins with you! Sprinkle them on whatever base you can have — cereal, oatmeal, yogurt, toast with a nut or seed spread — or just eat them straight out of the bag with fruit. You’ll get a gourmet, delicious breakfast instead of a bowl of sadness.
Bonus: make sure you like our Facebook and Instagram because we are going to be doing a giveaway of a tote bag full of ZEGO snacks, Mix-Ins, a water bottle, COOLA sunscreen, vitamins, and more starting on June 21! We will announce all the details then.
Keeping the Kids Busy
Now to keep the kids busy with fun summer activities! Programs at the park, gymnastics day camp, soccer skills clinics are all great opportunities to have another talk with your child about self-advocating, what to do if they have a reaction, and helping them feel confident in themselves. At school, there are usually teachers and other adults to help them, so summer may present their first opportunity to strengthen their self-advocacy skills without significant adult oversite. Of course, having a laminated card with all the essential information about their allergies is always a good idea, for kids and adults alike.
Playdates at your house are another summer essential. That requires planned activities (lest the activity becomes painting your toilet with fingernail polish while you think to yourself, “the kids are being so quite, I wonder if I should check on them …”). One thing our family has always loved is having fun in the kitchen together baking and cooking (in fact, you will find a whole section on our website of recipes created by my daughter Kelsey). Kids love when they can make delicious foods that are safe for them to eat. And, it can be a fun way to involve their friends in the conversation about safe foods, cross-contamination, and food preparation.
We put together some easy, fun recipes for you to use with our Mix-Ins. Mix-ins make a great addition to so many treats — from cookies to pancakes to granola brittle. Yes, I said brittle (YUM)! Download our FREE Mix-In cookbook full of recipes and ideas here. The nice thing about using Mix-Ins is that they make the most simple recipe seem gourmet, turning the every day baking into special occasion baking.
What Are Your Favorite Summer with Food Allergies Tips?
Now we want to hear from you–what are your favorite summer tips, activities, and strategies? Do you know of other allergy friendly summer camps that aren’t on the FARE list? Parents newly dealing with food allergies will benefit from your wisdom and experience!
Colleen Kavanagh is the founder and CEO of ZEGO. After a career in public policy working to improve nutrition for low-income children, she started ZEGO to provide superfood based snacks for people dealing with multiple food allergies. ZEGO is a certified B Corporation, and is working to bring transparency to the supply chain to improve food safety for all.
Food Allergy Awareness Week (May 13-19) and Celiac Awareness Month are both happening in May. This is a great opportunity to have conversations with friends, family, school, and others so they can better understand the whole of these medical issues, and see them as as something bigger than just your or your child’s personal diet or disease. Understanding builds compassion. So, how do you make the most of the opportunity? What I find works best when I am working with a buyer for a store who is skeptical of the prevalence and seriousness of these diseases is data. Here are some numbers I find particularly helpful.
Many of us have heard that food allergies affect at least two children in every classroom in the U.S. That’s a fairly old number by now (2009) but it’s still useful until we get an update from CDC. A more recent study shows hospitalizations for food allergy reactions have increased 400% in the last decade, suggesting that old 2 in every classroom number is likely much higher today. Still, there are many people who have relatively little interaction with people with allergies who doubt their validity because they have never heard these numbers. I don’t really blame them, it’s a lack of education and exposure to the issue–after all, food allergies have risen from relative obscurity to being fairly common in their lifetime. And, yet, they still may not know anyone personally with allergies. And, because allergies can be deadly, those with them are deadly serious about the issue. Passionate Cross Fitters and vegans have nothing on an allergy mom!
Looking back to the 1980s, the landscape for food allergies looked very different. As published in Allergology International Journal:
“In the early 1980s…food allergy was less prevalent, there was little public awareness of the problem, most clinicians were highly skeptical of the diagnosis, and there was little active research going on, primarily because many investigators did not consider the field to be “a real science.”’
This may help explain why some people, particularly people over the age of 50, are skeptical of these allergies. But by sharing these numbers and acknowledging that allergies have risen like an epidemic may help them hear you.
The good news is that over the last couple decades, work by organizations like FARE, FAACT, Food Allergy Awareness Week, and Turn It Teal have started to make the discussion about food allergies and understanding how to prevent potentially deadly anaphylactic reactions more mainstream topics. More schools are going nut-free, improvements are being made in food labeling, and more foods & recipes are available for those with food allergies.
Image from FARE
Food Allergy and Celiac Awareness
Since Celiac Awareness Month and Food Allergy Awareness Week are in the same month, it is a great opportunity to talk about their similarities and differences–confusing the two can have results ranging from mildly annoying to deadly. Simply put, they are both autoimmune diseases that require changes in diet. Neither one has a “cure” and both involve avoidance of the trigger foods. For some unfortunate Celiacs, avoiding the trigger food (gluten) doesn’t stop the symptoms.
It’s important to point out that the reactions are very different–they don’t compete for severity, both are serious and need to be treated that way. Both can be deadly, but Celiac is slowly through malnutrition or correlated diseases like cancer, while food allergy reactions can come on very quickly and be deadly within a very short period of time.
Because of this, some people don’t see Celiac as needing to follow a strict diet, including Celiac’s themselves. You may see Celiacs cheating from time to time or not worrying about cross contact (not me, I’m super strict). While it’s true your Celiac nephew won’t run to the hospital with a small exposure to gluten, over the long term it is very important he stick to his diet or he could die younger than expected from medical conditions linked to the disease. Another confusing thing to help people understand is that Celiac has over 300 documented symptoms. One person may have dermatitis, another gut, and another psychological consequences to eating gluten. As an example, I was diagnosed as Celiac at 15 but when I got to college, I decided that because I wasn’t having reactions when I drank beer, that meant I had outgrown it (you don’t outgrow Celiac but I was hoping to buck the odds). After three years, I started having severe bone pain and my bones were very brittle and weak. After a scan and new endoscopy, I finally embraced my disease and got serious about the diet. It’s no wonder my friends were confused when I suddenly became adamantly gluten free even though I didn’t look any different.
Another thing that many people do not understand is exactly what gluten is, because it is a protein found in several foods like wheat and barley, not the entire grain. FDA guidelines require that food cannot have more than 20ppm of gluten cross contact to be labeled gluten-free (that is 20 parts per kilogram of food). But companies are not required to test at regular intervals so gluten can sneak in along the supply chain and show up in these products (as happened with Cheerios years ago–if you have a reaction to a product labelled “gluten free,” be sure to email the manufacturer to let them know. If they are not regularly testing, you may be the only way they find out.)
How to Raise Food Allergy and Celiac Safety
The old standard for a product being safe for people with allergies and celiac was that if the facility it was made in did not deliberately bring in the banned foods, the product was assumed safe. That was as good as we could do for a long time and is still what 90% of companies use. But ZEGO wants to bring food safety into the 21st century because, in an era where you can check your emails on your watch and see a picture of the farmer who grew the food you are eating, you should be able to get batch level data on the safety of packaged food. So that is what we do at ZEGO. We test each batch for cross contact at the end of our process and connect the results to every package through its QR code. We advocate all companies should be doing this, not just “allergy free” companies.
But ZEGO can’t change food safety alone, we need the entire industry to adopt this standard. That’s where we need your help! If you let other food companies know that these kinds of results and labeling are important to you and your family, they will adopt this higher standard too. If every food allergic person took 15 minutes to email their three favorite companies to ask them to test and report, we could change the entire food industry and make batch level transparency the new standard!
How to Get Kids Involved
Food Allergy and Celiac Awareness Month’s are also a good time to get your kids involved. Whether they have allergies themselves or want to be better champions for kids’ who do, talk to your kids about food allergy safety.
Ideas for kids with allergies:
- Wear a teal shirt and tell your friends about food allergies
- Set up a time to talk to your class about your food allergies, and maybe bring in some allergy safe snacks
- Share your favorite book about food allergies with a friend
- Write a thank you note to teachers, family, or other people who help keep you safe
Ideas for kids without allergies:
- Ask your friends if they have any food allergies
- Talk to your teacher about your school allergy related rules
- Talk to your parents about how to help stick up for kids who have food allergies
- Watch a video or read a book about food allergies to better understand them
How to Save on ZEGO Products
Here at ZEGO, we are working hard all year long to make food that is allergy and gluten safe so that every child and adult can have a safe and yummy snack. We know how expensive it is to have a special diet and we try to find ways to offer you savings. Here are two great ways. First, we offer value-based subscriptions. Every subscription box is supersized with three extra bars, that is 25%-33% more product! And, subscriptions are super-flexible. You can get delivery every 1-3 months, change your flavor mix whenever you like and cancel at any time. If subscriptions aren’t your thing, for this month only (May), you can get free shipping for every order of two or more boxes of ZEGO bars! (usually free shipping is for orders over $100). Get the deal here & Enjoy!
Let us know how we can make your celiac or allergy life easier. We are rolling our our superfood seed and fruit blend that we call Mix-Ins this month. What type of product would you like to see us make next? Let’s grow this company together to make your life easier and healthier!
Three Steps from FARE on how to keep friends with food allergies safe.
Colleen Kavanagh is the founder and CEO of ZEGO. After a career in public policy, she started ZEGO to provide superfood based snacks for people dealing with multiple food allergies. ZEGO is a certified B Corporation, and is working to bring transparency to the supply chain to improve food safety for all.
Whole Foods is a major part of the organics industry and growth of small brands. If you have been following our insider’s look into the food industry, especially how it is impacted by Amazon purchasing Whole Foods, welcome back. If you missed Part 1 and Part 2, feel free to read those first!
Amazon’s founder Jeff Bezos is one of the greatest entrepreneurs in modern history. Surely, he would not have bought Whole Foods Market with a strong “Plan B” and “Plan C.”
Let’s assume Plan A is reviving Whole Foods. In the first two parts of this blog series, I laid out a few facts about changes in organics and in Amazon’s management of Whole Foods that call into question whether that will happen. It seems pretty obvious that Plan B would be to change Whole Foods into local Amazon distribution stores. What is the most fun to talk about (and I admit a bit of a stretch) is that Plan C could be converting the Amazon and Whole Foods gift card industry into a cannabis banking system? And, these three plans don’t have to be alternatives, Bezos could do all of them, and in a relatively short period of time.
Bezos’s Alter Ego Is Unlikely Mr. Green Jeans
Bezos’s plan was never just Plan A. That’s too boring for him. Whole Foods was ripe for a buyout because of declining profits. But, turning around a grocery from declining to rising profits has been done many times before — cutting costs and squeezing vendors is nothing Bezos invented (see Part 2 of this blog series). It’s hardly exciting for someone looking to take people into space (Blue Origin).
I’m sure his team did enough research to know about the changes in the organic industry (see Part 1 of this blog series) and the challenges of growing a company that sources much of its goods from a very small amount of organic farmland production (under 1% of US farmland is organic in the US). He must know there are a finite number of stores a high-priced grocery like Whole Foods can operate. Wealth is concentrated in pockets of the United States, just check a map of the Starbucks locations to find out where.
Based on the changes he’s implemented already at Whole Foods, I am guessing Bezos may not appreciate how important the Whole Foods experience is to shoppers – finding and supporting small local brands, the inviting, warm in-store experience. In fact, since I wrote my last blog highlighting these two issues, Amazon fired its entire marketing team that does those cute hand-drawn (looking) signs on chalkboards that are part of what makes the store feel more like a farmers’ market. From the perspective of the shopper and small vendors, it looks like Plan A of “making Whole Foods great again” is not likely to happen. So, let’s move on to Plan B.
Plan B Comes to the Rescue When “Making Whole Foods Great Again” Fails
Amazon’s biggest challenge it’s last mile. The company is great at getting goods from one warehouse to another but getting it to your door is expensive and challenging. That’s why you see the US Post Office at your door on Sunday afternoons delivering your Amazon goods. Clearly, Bezos likely can make a lot more money operating Whole Foods’ 450 locations as local pickup spots for Amazon purchases and having the grocery side morph into the “Amazon Fresh” program for food delivery. But, there is plenty of reason to keep the grocery stores open to shoppers.
Amazon Could Redefine In-Store Shopping
Amazon has been experimenting with “checkout free shopping,” and it has real appeal to it. Standing in a checkout line is so 2015.
Given that, why even go to an Amazon store at all? After all, you don’t need to try on earphones, and they can be delivered to your door.
Fresh food. Fresh food is what brings you to the store most often, produce and refrigerated items. Most people prefer to pick out their own produce to make sure their apples aren’t spotted and peaches aren’t bruised.
Amazon would be smart to use high quality, low-price fresh grocery items as bait to get you into the store. While there, your impulse-buy of a new pair of headphones and tiny Bluetooth speakers for your cat (because cats can’t wear headphones) become the store’s profit center. If we could get all that in one place, we might not mind so much that the cute chalk board signs are gone and the organic apples are from Chile.
I have a friend who owns a very successful chain of sporting goods stores. His bait is athletic shoes but I dare you to walk into his stores and not come out with 3x the cost of those shoes in other non-essential, higher profit margin items from yoga mats to tents to Frisbees. The problem with Plan B is that stores like Target and Walmart already offer everything from produce to furniture, and City Targets serve some of the same high population areas. Amazon Whole Foods will need to offer a superior experience to get an edge on these retailers, but as I wrote in Part 2, it’s already losing that “customer experience” edge. And, once Bezos perfects “checkout free shopping,” companies like Target and Walmart are likely to copy it.
Will Bezos Be Bold Enough to Revolutionize Banking?
I’m not really predicting Plan B because Bezos and his team are already making moves in that direction with Amazon locker pickups at Whole Foods locations. What’s more interesting is to explore the idea of Plan C in which Bezos could become the premier banker for the cannabis industry virtually overnight.
Let’s me preface this by saying that I am NOT a banking expert. This discussion is more a topic for lively cocktail party conversation, not one on which you should base an investment decision. But surely the rise of Bitcoin has shown that banking is ripe for a revolution. Bitcoin also isn’t helpful if you deal in cash though; the whole point of the crypto-currency is that it is cashless.
Remember cash? You used to carry it in your wallet all the time, even in your shoe. Cash is an important conversation topic now because various aspects of growing and selling cannabis is now legal in several states, and cannabis is largely a cash-based business.
Cannabis Banking Background (for those interested in some detail)
Let’s quickly cover some background. In a nutshell, eight states have legalized cannabis and a handful more are considering doing the same in 2018. The trick is that under federal law, cannabis is simply illegal drug money, despite these state legalizations. And, though the Obama White House was willing to look the other way on the matter, the Trump Administration has threatened otherwise. Jeff Sessions called marijuana, “slightly less awful than heroin.” Cannabis bankers can be charged with racketeering, which is a criminal offense. They also can’t get FDIC insurance for the accounts, but if you are in jail for racketeering, I think the insurance issue is probably not what you are regretting.
Congress has considered, but not passed, a bill to protect the cannabis industry in states where it is legal. Despite this, the number of banks accepting cannabis customers has increased nearly 20% in the last year, but that only brings the total to 400. And, the prevalence of banks depends on the state. This is because, in 2013, deputy US attorney James Cole issued what is known as the “Cole memo,” which outlined the eight biggest concerns the federal government has with the industry, like selling to children. The Treasury Department followed up with guidelines for banking based on those eight priorities. This guidance does not change the fact that cannabis is still illegal under federal law, but it gives banks a little more security if they dare to enter the business. States are required to issue regulations based on the guidance. It’s a bit like being in a flimsy legal hammock hanging high up between illegally planted trees–with Jeff Sessions down below pondering over a chain saw.
So far, only the state of Colorado has issued state regulations based on the Treasury guidance. California should be next. In fact, California and the city of San Francisco are considering setting up banks that would accept cannabis accounts. This may make it seem like banking reform is already happening, but remember the federal guidance could be revoked any time.
Under federal law, cannabis remains illegal. Even with the Cole memo and state regulations, bankers willing to take the risk are technically racketeering. Legalization is rolling out fairly quickly state-by-state. So, even if the federal guidance stays in place, there will be a lag time before state legislatures and banks can catch up. With six more states likely to legalize cannabis in 2018, the problem will continue far into the 2020’s.
Bezos Could Instantly Double the Number of Cannabis “Banks”
As a result, people in the cannabis industry carry around a LOT of cash, and they will be for quite some time. Employees are paid in cash; warehouse leases are paid in cash; taxes are paid with money orders; you get the picture. Robberies plague the industry but they are downplayed so the public does not get concerned. With that background, let’s circle back to Bezos and look at how this could emerge as his Plan C.
There are about 450 Whole Foods stores in communities across the country concentrated exactly where you would think they would be, in densely populated areas with higher incomes.
Amazon already offers one of the most useful gift cards in commerce. For this model, think of them as electronic cards — basically a number you receive that used to be embedded in a card but would become your electronic Amazon cash account (just download the Amazon money laundering app to access it). People with cash can convert it to Amazon money by dropping off their cash at any of Whole Foods 450 locations around the country (please spray with a non-toxic deodorizer before arriving).
Suddenly, the entire industry has a place to deposit their cash, and it’s located in the same place they can spend it! I would imagine the green entrepreneurs would happily pay a fee for this service, which Bezos would need for lawyers and self-insurance. Inevitably, a secondary market will come to bear to help people convert this Amazon money into actual money that could be used to pay tuition, buy a car or be put into savings in a traditional bank. Assuming no one goes to jail, which is a big assumption, this could develop into a brilliant new banking system.
About jail. Amazon Whole Foods would be expose itself to racketeering charges and possibly others I’m not aware of? Yes, of course. But in the meantime, Bezos could rapidly make piles of money and zip past legislators and regulators who scramble to try to figure out what to do. How long could he keep that up before someone puts on the brakes? If Uber can be used as a comparison, indefinitely.
Plan C is a stretch for sure, but Bezos has stretched the commonplace in commerce since he first started his online bookstore decades ago. And, an industry with a cash problem expected to grow from $9B in 2017 to $21B by 2021 is just asking for entrepreneurial disruption.
What Will the Future Hold?
If Bezos keeps going down the path he’s headed on with Whole Foods under Plan A, and the company will likely lose its competitive edge in grocery. The next evolution under Plan B, to create “Amazon stores,” could fail if they prove to be nothing more than an overpriced City Target. Wouldn’t it be incredible if, as fantastical as it sounds, Plan C’s cannabis banking ends up being Amazon Whole Foods’s new bread and butter, without the . . . bread and butter.
I sincerely believe a man with tens of billions in dollars in personal wealth who is rapidly building a company to go into space will not be satisfied with turning around a grocery store or building a better Target. I can’t wait to revisit this in two years and see what happened.
What do you think? Would you like to shop for produce, books and computer game systems at your local Whole Foods, or would you just go to Target? If you don’t support cannabis legalization, would you choose not to shop at Amazon Whole Foods if the company became entwined with that industry? Would you feel comfortable shopping at a grocery that was accepting large cash deposits or would you be concerned about robbery? Have fun with this at your next cocktail party!