Tuesday, April 23, 2024

FoodLogiQ tracks quality, safety in food supply chain

By David Ranii

Tracking food safety and quality throughout the field-to-fork supply chain has become a robust $12 billion annual business. One of the more promising operators is Durham-based FoodLogiQ, which provides “food traceability” technology to a growing roster of customers. Among the users are restaurants such as Buffalo Wild Wings and Chipotle Mexican Grill; chicken producer Tyson Foods Inc.; grocers such as Whole Foods Market Inc.; and hundreds of produce growers and distributors.

Some company contracts are in the “high six figures,” according to interim CEO Jamie Duke, though he wouldn’t share specific revenue details. “We are happy with the growth we have had, and we are ecstatic about the potential.”

Others are noticing. Forbes magazine included FoodLogiQ on its list of 25 Most Innovative Ag-Tech Startups for two years running, citing its software that lets clients track food through production, processing and distribution. In March, FoodLogiQ announced that its first round of outside capital, which it started raising in 2017, totaled $19.5 million. Investors include the venture arm of Tyson Foods; German measurement-instrument-maker Testo AG; and investment firms in California and Canada. Its staff of 45, including 35 at its Durham headquarters, has nearly doubled over the last 12 months.

Now the company is kicking off a pilot program aimed at ascertaining how blockchain, the red-hot technology behind bitcoin, can help it better serve its customers. Duke says the pilot, unveiled in June in conjunction with partners including the purchasing cooperative that serves 30,000 Subway franchise restaurants, has raised FoodLogiQ’s profile with existing and potential customers.

Duke is a former chief operating officer at Morrisville-based software developer SciQuest, which was renamed Jaggaer after being acquired for about $500 million in 2016 by Menlo Park, Calif.-based private-equity firm Accel-KKR. He was a FoodLogiQ consultant and board member prior to being named interim CEO in August. His predecessor, Dean Wiltse, departed after three years in the post because of “pressing personal matters,” Duke says, declining further explanation.

The company doesn’t have a “hard-fast deadline” to hire a permanent CEO, says Geordan Hankinson, principal at Vancouver, B.C.-based Renewal Funds, a lead investor. The search team seeks a CEO “who has the vision, the passion and the substance to take FoodLogiQ to the next level of success,” he says.

FoodLogiQ was formed in 2006 by Clarkston-Potomac Group Inc., a Durham business-services firm that provided initial funding and remains a major shareholder. The business was co-founded by Tom Finegan, chairman and CEO of Clarkston-Potomac, and Andrew Kennedy, who remains a company adviser.

Started as a food software consulting company, FoodLogiQ switched gears three years ago by launching its own software platform. The move came just as the food industry was adjusting to stricter rules requiring more documentation by businesses regulated by the U.S. Food & Drug Administration, says Todd Dolinsky, chief product officer.

The Food Safety Modernization Act of 2011 also upped the FDA’s enforcement powers after a series of high-profile food-safety incidents. The law sparked a booming food-traceability market to follow fresh meat, produce and other products as they move through the supply chain. “Our marketing strategy is very clear,” Duke says. “We are focused on connecting the world’s supply chain.”

With FoodLogiQ, “I’m thrilled with the visibility we have on quality throughout our restaurant chain,” said Emily Grisbeck, supplier quality manager at Buffalo Wild Wings, during a recent technology webinar. In an interview posted on FoodLogiQ’s website, a Buffalo Wild Wings senior supply chain professional, Erin Kvittem, estimates that the time spent tracking and managing quality issues has declined nearly 90% since the chain became a FoodLogiQ customer.

The FoodLogiQ Connect platform is a suite of three products that can stand alone or work in tandem. Manage + Monitor manages documentation required by the 2011 food-safety law and helps clients analyze issues with suppliers, including quality audits. Connect’s Track + Trace follows products through the supply chain and can get as granular as a specific row of strawberries in a grower’s field. With Recall + Response, launched last year, food companies can issue real-time recalls or product-withdrawal notifications via email, phone or text to its sites and suppliers, then monitor resulting actions.

The products are compatible with PCs and mobile devices and include bells and whistles such as using photos to document quality issues. Web-based software lets FoodLogiQ churn out updates every three weeks.

For Minneapolis-based Buffalo Wild Wings, Connect has proven easy to use, officials say. That’s crucial because when a restaurant chain becomes a customer, its suppliers and each of its locations also use the software. For the wing chain, that includes 80-plus suppliers and 1,265 restaurants. Altogether, more than 8,000 suppliers use Connect, though they aren’t necessarily paying for the service; many use the product by piggybacking on their own customers’ software license.

“FoodLogiQ goes much deeper into solving multiple food-company pain points than the other single-solution products on the market,” Hankinson says. While it has the potential to be dominant in its industry, he says the company faces common challenges for fast-growing startups: recruiting and retaining top talent and forecasting customers’ needs in a fast-changing market.

Duke is excited about what lies ahead. “An old friend told me a long time ago that you can go up a mountain only seeing 20 feet in front of yourself at a time. You don’t have to see all the way up to the top. And that’s what we’re going to do. Our blockchain pilot is about our first 20 feet. It’s our first step into the technology and what we might do.”

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