Creating Health Care, Disguised as a Grocery Store

Fast food, wasted food, and food insecurity may all have met their match in a low-cost market where every morsel has been approved by a nutritionist. The nonprofit grocery store Daily Table throws open its doors today, selling good food that would otherwise have been discarded, for very low prices.

Located in Dorchester, Massachusetts, a community with low access to healthy food for its many low-income residents, it’s a store with a mission. Daily Table’s Nutrition Task Force ensures that every item for sale is healthful and nourishing, whether on the shelves or prepared by the Daily Table’s top-notch chef. “You will never see unhealthy sodas, snacks, or candy bars,” its website promises.

The mastermind behind this groundbreaking idea is Doug Rauch, former president of Trader Joe’s, who sees Daily Table as “a nonprofit health-care initiative masquerading as a retail grocery store.” He started work on it before a 2013 report raised public consciousness about the arbitrariness of expiration and sell-by dates. I spoke with Rauch just an hour before his store opened for the first time. Our interview was edited for clarity.

Food waste has really taken off as an issue in the past year or so, but you were vocal about this concept in the media for much longer. Were there delays in bringing the idea to reality?

We had four delays. First and most important, we needed the community to accept the idea. If the community rejects the store, it’s like an organ donation to a person with a different blood type. We listened and responded to the community’s feedback, and made significant changes to get people interested and excited.

“Nutrition is the cheapest form of health care. We, as a nation, must figure out a way to address the health care tsunami that will hit us—Doug Rauch, Founder of Daily Table

Second, the IRS was understandably scrutinizing us as a nonprofit organization. We collect food donations and prepare them to be resold—naturally that will raise IRS eyebrows. After more than two years, they are comfortable that we are truly a nonprofit health-care initiative masquerading as a retail grocery store.

Third, we had to collect funding. Brick-and-mortar is more expensive than creating a website that connects farmers and foodbanks—also a wonderful effort. It cost north of $1 million just to get our store and equipment ready, and we found partner foundations who were willing to take a risk on a brand new innovative concept—Pepsico, Robert Wood Johnson, New Balance, and Newman’s Own, in addition to smaller foundations and individuals.

Fourth, the Boston Health Department had to feel comfortable with us collecting donated food, cooking it, and selling it, because their mission is to serve and protect the citizens of Boston. That’s the Daily Table’s mission too, so we worked together. It’s not often that the assistant commissioner comes to inspect the store personally.

produce at The Daily Table

Daily Table works with other stores to take produce and other goods that would otherwise be thrown away, and offers them to customers at a low cost. Photograph courtesy Daily Table

What kinds of changes did you make after speaking with the community?

The question is, what is the problem we are trying to solve? If we come up with a great solution to the wrong problem, it won’t be helpful to the community. The problem is access to a healthy, affordable, delicious, convenient meal for communities with low-nutrient access and if you look at it that way, it changes the dynamic of what you do. Even if you put a Walmart on every corner, food-insecure people still wouldn’t be able to buy fresh produce because nutrients are expensive in our food system and empty calories are cheap.

The Daily Table addresses this by collecting wholesome, excess food and buying items that our partners price very aggressively. We are open from 11 a.m. to 8 p.m., so when you get off the bus and need to buy tonight’s dinner or need to have lunch, we are there. It’s not a mobile bus or a farmers’ market which—while great—are not brick-and-mortar retail. Retail anchors the community, gives people jobs, and economically lifts the community because most of the money stays local.

Photograph courtesy of The Daily Table

Photograph courtesy of Daily Table

What about the health concerns over people eating food waste?

I’m not interested in food waste. That’s waste that comes from food, and that is handled by compost piles and the sanitation department.

I’m interested in wasted food. That is significantly different. Exhibit A for wasted food is that I was in a Boston produce market that was closing for the day and one vendor asked if I had my truck with me, which I didn’t because we hadn’t opened yet. He was throwing away thousands of pounds of mangoes—right into the dumpster. What was wrong with them? They were almost ripe, not ready to eat that day. We will collect as much of this wasted food as possible, plus buy products at special pricing—for example, if a company is changing a label.

So why is a retail model a good use for wasted food?

America has 49 million food-insecure people. Coming up with sustainable, viable solutions requires two things. First, the solution must be economically sustainable; we need market-based solutions. Second, the solution must build a community up and engender dignity and self-respect.

What I like about retail, even if we are selling for pennies on the dollar, is that the customer still has the power. They choose their own food, you don’t select it for them. Cornell University has research that if you give a kid an apple, it will wind up in the trash because there is no emotional or psychological engagement associated with choice. If you allow the kid to choose the apple, the kid will eat it. And we have to earn their patronage every day.

Retail creates a sustainable model because we have to respond to our customers. Because we are a non-profit though, our goal is to break even. We price healthy foods to compete with junk food options in the neighborhood, because our competitor is fast food. Poverty is not just about economics, it’s about time—people in economically challenging circumstances have even less time than others.

What foods does the Daily Table sell to respond to its customers’ needs?

What they really need is a grab-and-go prepared meal. It’s not of much value to provide raw ingredients and say, “Go home and cook.” That doesn’t meet them where their needs are. We have a 9,000 square-foot space and 6,000 of it is commissary kitchen; 3,000 is retail. And every hour of every day, we will have food you can try.

Does home cooking fit into the Daily Table?

We have demonstration stations. We are partnering with Codman Square Health Center and Healthworks Community Fitness to create a teaching kitchen for kids after school and parents on evenings and weekends. They can get something to eat and learn how to create healthy meals, to build the community up.

Your chef has a lot of experience cooking with wasted food.

I was so blessed to find Ismail Samad. He has a long history of turning ingredients he’s collected into delicious gourmet meals. He is culinary trained with great New York chefs, and co-founded the Gleanery in Vermont, an enormously successful for-profit restaurant that sells dishes for $25, $40 per plate using surplus food. He says, if you want to be green, eat glean. The only difference with the Daily Table’s model is that we are cooking for a community that is struggling to eat well. When he went to church meetings and civic meetings with samples, the community loved it and said, “Is this what you were talking about? When does it open?” They were already comfortable with it as an idea but when they eat something delicious and healthy and find out it’s 99 cents for a 24-ounce tub, they are excited.

I also got really lucky with Rudy Rubenis, who comes with 20 years of experience at Whole Foods. Whole Foods is a very mission-driven company so he knows all about mission-driven retail.

What I like about retail, even if we are selling for pennies on the dollar, is that the customer still has the power–Rauch

Do you think the average Whole Foods shopper would be comfortable at the Daily Table and if so, will they come in and buy all that inexpensive, delicious, healthy food out from under the community?

The IRS had the same concern, that higher-income people would buy up our products and we wouldn’t end up serving our target audience of economically struggling people who live around the store. So we created an easy, free membership requiring only zip code and a cell phone number to ensure that we are predominantly serving people from the area. If it becomes a concern, we will address it but I don’t think it will because of our location and Boston traffic.

Are you going to expand to open more stores, either in Boston or around the country?

The sad thing about expansion is that we are overwhelmed with possibilities—there are so many places with struggling communities. The next store for sure will be in Boston because our existing kitchen can provide food for several stores. Other than that we will look to expand to where communities will support our model.

How will the Daily Table fit into the overall future of food?

Nutrition is the cheapest form of health care. We, as a nation, must figure out a way to address the health care tsunami that will hit us, before the morbidities associated with bad nutrition really start hitting. Whether it’s through the Affordable Care Act or private insurance we will all pay for it, so let’s try to pay for it before it arises.

The Daily Table is not a silver bullet; it’s an arrow in a quiver. We’re planning on having life-skills workshops for our employees soon, with legal and financial literacy, nutrition, and public speaking classes so they can make their best contribution in their community. We will pay them for their time even though it’s not directly related to the Daily Table because it’s job training to be their very best.

I love retail for all of these reasons. You anchor community and are face-to-face with the end user, can educate and nudge them. As with Trader Joe’s or other companies that are known for great customer service, if you treat people with respect in a warm environment, amazing things will happen.