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2 ASU projects aim to combat rising problem of food waste

July 24, 2017

USDA awards nearly $1 million to research from W. P. Carey School of Business looking at online marketplaces, scan-based trading

Researchers from Arizona State University’s W. P. Carey School of Business will explore solutions to food waste through two unique research projects funded by nearly $1 million from the USDA’s Agriculture and Food Research Initiative.

Online marketplaces to reduce waste

The first project will test online marketplaces and mobile apps. These emerging sharing-economy companies could help farmers, restaurants, retailers and households manage problems with day-to-day food waste. 

For example, if a farmer has a box of ugly fruits or tomatoes that won’t sell in the supermarket because they’re too big for the grocery-store display, he can use an online platform to let others know he has a surplus of food. Consumers then visit the app or website, select the items they want, and the app coordinates delivery logistics and payment for the farmer.

Lead investigator Tim Richards says the idea is making markets out of what would otherwise be waste. 

“In Arizona and around the country, 18 percent of landfills is food waste, according to the EPA — and that may be a conservative number,” says Richards, the Marvin and June Morrison Chair in Agribusiness at the W. P. Carey School. “If we can figure out a way to better utilize food that would otherwise be wasted, we can minimize what goes into our landfills and more importantly make better use of the water that’s used to irrigate plants, saving 25 percent of our freshwater supply each year.” 

Researchers at ASU are teaming up with Imperfect Foods, a startup delivery company based in San Francisco, to test market theories and demand conditions. In addition, the experiment will use 400 business students at Arizona State University and California Polytechnic State University to measure their use of food waste.

At the conclusion of the two-year research period, investigators hope to be able to answer the following:

  • How will these innovations impact farmers and consumer food prices?
  • How will knowledge and information impact demand uncertainty among food manufacturers, family meal planning and food waste?
  • Are stakeholders in the food supply chain receptive to dealing with collaborative enterprises?

Food Waste: A Market-Based Solution Using Commercial Peer-to-Peer Mutualization Systems won an Agriculture Economics and Rural Communities (AERC) grant totaling $496,589. 

A closer look at scan-based trading

A second ASU research project will put scan-based trading (SBT) under the microscope. SBT is a newer type of contract used by food suppliers and retailers such as Walmart and Target, where the supplier retains ownership of the inventory in stores until the product is scanned at the register for checkout.

Suppliers, such as dairy producers or bakery vendors, are responsible for keeping products in stock, while the retailer provides vendors with valuable shelf space and its employees manage that space. Any loss of product between delivery and checkout is typically the responsibility of the supplier, not the retailer. 

One major problem in SBT is “shrink,” the loss of product between delivery and checkout — anything from expired inventory and broken cartons to theft. This could mean a loss for the supplier under an SBT contract, who may decide to increase wholesale prices to cover its losses. The retailer could then pass that increase along to customers by raising prices, according to lead investigator Elliot Rabinovich.

“We hope to explore the causes of shrink and how to address it. Can suppliers do a better job at managing it? Or do retailers need to have greater sensitivity — regardless of whether they own the inventory or not,” said Rabinovich, a supply chain expert and the John G. and Barbara A. Bebbling Professor of Business at the W. P. Carey School. “It’s not finding out who’s at fault, it’s how do we work together.”

SBT contracts do have benefits, including giving suppliers access to real-time sales information from retail checkouts and the flexibility of replenishing stock in-store without having to go through a distribution center, which traditional contracts often require. 

At the conclusion of the two-year research period, investigators hope to be able to answer the following:

  • How can SBT contracts support the objectives for all involved — retailers, suppliers and the farmers who sell to them?
  • Is there potential to minimize food waste through the supply system by using SBT?
  • How does shrink at SBT stores and non-SBT stores impact wholesale and retail costs?

Scan-Based Trading: Opportunities for Enhancing Supply-Chain Efficiency won an AERC grant totaling $496,407. 

Rebecca Ferriter

Communications Manager , W. P. Carey School of Business

310-871-9041

 
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ASU students' startup AirGarage to relieve parking distress

AirGarage student founders get boost from several ASU entrepreneurship programs.
July 24, 2017

Online marketplace to connect drivers, homeowners for affordable alternative to campus; goal is to expand to other colleges

Editor's note: This story is being highlighted in ASU Now's year in review. To read more top stories from 2017, click here.

With many major universities nationwide charging $500 or more a year for parking, two students at Arizona State University created a company to alleviate stress associated with finding affordable parking options near campus.

“Parking is so expensive,” said Jonathon Barkl, a physics and economics major in the College of Liberal Arts and Sciences. “We want to make it more accessible and affordable for students who traditionally can’t park on campus because of the price.”

In September 2016, Barkl and Scott Fitsimones, a computer science major in the Ira A. Fulton Schools of Engineering, founded AirGarage — an online marketplace for people to list, find and book parking spaces in Tempe, Arizona. For example, a homeowner with enough room in a driveway for an extra car could list that spot and a driver needing to park in that area could rent it. The students are striving to generate value for both parties by creating a market for extra space on private property that may not have previously been thought of as available parking.

“There are a couple other companies that manage parking, but they mostly create value for the parking garage,” said Barkl. “AirGarage is creating new supply to meet the excess demand in parking, which will add new value for two different groups who haven’t seen value for their homes or cars in years.”

After surveying 250 students, Barkl and Fitsimones found nearly 33 percent of the students don’t park on campus, citing prices as the biggest factor in their decision. And, despite paying for parking, a majority of students still walk anywhere from five to 15 minutes to get to their classes.

Currently, AirGarage is focused on helping ASU students find parking close to campus. The student co-founders plan to partner with the city of Tempe to reduce congestion and limit the need for more parking facilities.

“We’re trying to connect people with the untapped resource sitting all around us,” said Barkl.

AirGarage has about 36 spots listed at the moment. As Barkl and Fitsimones figure out how to grow and scale the company, they want to branch out to other universities. From there, the students want to expand to other areas around the country that have parking shortages as well.

“We’ve developed this car culture over the past 100 years, yet the biggest nuisance of our daily lives is finding somewhere to put the 2-ton hunk of steel we use to carry us around every day,” said Barkl. “It’s a little ridiculous that we haven’t come up with a better solution to this problem.”

Cofounders of AirGarage: physics and economics major Jonathon Barkl and computer science major Scott Fitsimones

Physics and economics major Jonathon Barkl (left) and computer science major Scott Fitsimones founded AirGarage in September 2016.

In November 2016, Barkl and Fitsimones competed in the Ira A. Fulton Schools of Engineering eSeed Challenge, a competition hosted through ASU’s Entrepreneurship + Innovation division that encourages students to make a difference in local and global communities through innovation.

After being selected as one of the top ventures, the students won $6,000 in seed funding and an all-expenses-paid innovation field trip to advance their startup, which was hosted by Tom Prescott — the former president, CEO and director of Align Technology Inc.

The students also received guidance from Brent Sebold, the executive director of venture development at Entrepreneurship + Innovation in ASU’s Office of Knowledge Enterprise Development.

“ASU’s entrepreneurship resources were really helpful in being able to found this company,” said Barkl. “They plugged us into a network of bright, successful entrepreneurs, which helped us formulate and develop the idea further.”

In addition, Barkl and Fitsimones took advantage of the Sandra Day O’Connor College of Law Innovation Advancement Program, which pairs emerging technology companies with ASU’s brightest law students to help solidify a startup’s legal foundation, including the creation of user agreements and contracts.

“ASU’s commitment to innovation has provided the perfect market to help us prove our idea,” said Barkl. “If AirGarage can become a successful startup, it’ll inspire other students and foster a startup culture in the Phoenix metro area.”

For students who want to launch similar ventures, Barkl advised them to just get started. He said it has been a daunting task to start a company going into his junior year of college, but he’s determined to pursue the challenge.

“Taking the first step is the hardest part,” said Barkl. “But if I can create value for people in some way, then I’ve had my impact on the world. My desire to have an impact on people is what drives me.” 

For more information about AirGarage, visit the company’s website or Facebook page

AirGarage is one of five finalists for the Feb. 2, 2018, ASU Innovation Open. The other finalists are ASU teams Hoolest and Hygiea and MIT teams Bloomer HealthTech and W8X