By Tunde Wey
February 13, 2013
If you think Noam Kimelman is trying to save Detroit, you are wrong. Yes, he helms a "social enterprise" that works to increase access to healthy and fresh foods in Detroit, and he also founded a nonprofit that teaches Detroit youth about running food-based businesses. He is a steering committee member at a local group promoting triple-bottom-line business practices and his resume is filled with similar other positions. Kimelman is active in his local synagogue and helped start an informal group that discusses Palestinian-Israeli issues. But to be clear, Kimelman’s purpose is not to save Detroit ... it is to learn about Detroit.
The first lesson Kimelman learned was to be aware of the limitations of pre-suppositions.
"I think one of the major assumptions we had coming in is that Detroit is food desert. We overestimated the extent of the food desert in Detroit. There are really close to 100 grocery stores in the city, and while they are not all high-quality a lot of them carry fresh produce. So the issue wasn’t necessarily access to healthy foods but maybe convenient access to quality foods.
‘We bring the café experience to corner stores across the city, hence ‘Fresh Corner Café.'" By the "cafe experience," Kimelman means providing high-quality, nutritious, fresh foods to locations where they are uncommon. Fresh Corner Café sells fresh salads, wraps, soups, yogurt parfaits, fruit cups, cottage cheese cups and hummus dips. They also offer vegetarian fare.
Kimelman, 26, is originally from Boston, Massachusetts and came to Detroit by way of the University of Michigan. His company Fresh Corner Cafe
was the result of a class project.
"I started it out of my Masters program in healthy policy at the University of Michigan. I took a class on social entrepreneurship and we formed a team around the concept of generating a financially-sustainable model to help increase access to healthy foods in Detroit.
‘We focused on corner stores and gas stations because we realized that even though there aren’t many grocery stores there are 800 to a 1,000 of these corner stores. Since reliable transportation is such an issue, many people rely on the closest retailers for a large part of their food needs. We figured if we could develop a sustainable model in one store, and we could make money from one store, we could replicate and scale throughout the city."
The next lesson Kimelman learned was the importance of hard work. Before even starting the company, Kimelman and his colleagues spent about a year and a half working to develop a financially-sustainable model for the business.
Kimelman describes Fresh Corner Cafe’s model, saying, "We partner with local food producers and local retailers to bring healthy foods to corner stores across the city. We have two food producers and they create ready-to-eat fresh food products and prepared meals, and we distribute those every Monday, Wednesday and Friday to 30 locations throughout the city. We deliver to corner stores, gas stations, small grocery stores, convenience stores, cafes ... We are a logistics and marketing company delivering fresh and healthy food."
After the initial research period Kimelman and co-founders Zach Markin and Valaurian Waller launched the business in 2011. A year later the business was selling its healthy food options in 30 locations across the city and grossed around $100,000 in revenues. Their success was definitely never guaranteed; in fact it hinged primarily on their pre-launch preparation and constant, unrelenting customer acquisition strategy. Kimelman says simply, "It started by going out to stores and selling the products; cold calling."
This dovetails perfectly into Kimelman’s third lesson; revenues are not profit.
Kimelman was working 70 to 80 hours per week without drawing a salary, because he was preoccupied with getting the business right. At the core of "getting the business right" were two key challenges Kimelman and his team recognized.
It was quickly apparent to them that to remain financially viable while meeting their mission of providing access to healthy foods, they would need to tweak their revenue model to reflect the demographic reality. Kimelman says, "We have had to complement our work in lower-income neighborhoods with our work in wealthier neighborhoods; cross-subsidize."
While they saw gains from the pivot, they were faced with a larger existential threat. Kimelman explains further, saying, "The largest challenge is product waste. We are dealing with a highly perishable product and highly unpredictable demand. So we want to keep a full stock in all of our stores and make sure that there is always products for people who want them and that causes us to lose a lot of money from product waste." Kimelman, who operates out of the Green Garage
, a business incubator for mission-driven triple-bottom-line businesses, is working with a statistician to develop mathematical models to predict customer demand and minimize waste.
This challenge of in-store waste has a corollary in distribution. Since Fresh Corner Café distributes its products to its vendors, transporting them also requires logistical considerations to ensure their freshness.
Kimelman discusses the challenge and the corresponding solution his team deployed, saying, "We used to have one truck and one driver who would go around to 25 stores in one day. The product will sit around in the truck for ten hours. Even though it was refrigerated it reduced product quality and it also created a job that I didn’t want to be responsible for creating. A full-time delivery position is pretty rough. It’s something that I used to do and I wouldn’t want to impose that on somebody else. So I wanted to create a job of the future, a part-time position that offers a lot of experience. So instead of one driver we have four drivers and they each deliver to six stores. And that way we can have more people part of the Fresh Corner family and I eventually want to create a model where each driver is serving his or her own neighborhood, because every neighborhood is different and I want to make sure we understand the neighborhood we are serving."
This distribution and fleet model has been instrumental in the company’s expansion, creating, as Kimelman describes it, "a solid foundation for growth and scalability."
So if after you know all this and you still think Kimelman is trying to save Detroit, you might be right. It seems the way to "save" Detroit, or anything for that matter, might be to learn new things and become better at them. Kimelman exemplifies that.
Photograph by Marvin Shaouni Photography.