BRICK by BRICK: Building Insurgent Brands

Walking the Talk on Sustainability

February 15, 2023
|
43 Minutes
Listen Time
BRICK by BRICK: Building Insurgent Brands

Walking the Talk on Sustainability

43 Minutes
Listen Time
Walking the Talk on Sustainability
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We hosted Katherine Desbaillets, Chief Brand Officer, SaladStop Group in the 9th session of #brickbybrick: ‘Walking the Talk on Sustainability’. SaladStop Group was founded in 2009 with environmental consciousness and sustainability at the forefront of its operations. With 28% of global emissions attributable to the food industry, SaladStop Group felt the urgent need to reduce its climate impact. In 2022, they launched Southeast Asia’s 1st Net Zero-certified F&B outlet. SaladStop Group is a great case study of how ESG can be a pillar for business and how early-stage companies can walk the talk on sustainability.


Tune in to hear us discuss:

  • How ESG is built into the DNA of SaladStop through various innovations and initiatives
  • The challenges, trade-offs, and costs associated with prioritizing sustainability
  • How ESG can deliver better business results for companies
  • Actionable advice for young startups building their ESG strategy

Transcript:

Sameer

Welcome everyone to Episode 9 of the BRICK by BRICK series by DSG Consumer Partners where we talk with some of the brightest minds building insurgent brands across India and Southeast Asia. For those who don't know, DSG Consumer Partners, we are an early stage consumer focused venture capital fund investing across India and Southeast Asia. We manage more than $300 million on behalf of our investors, and have proudly invested in more than 78 consumer brands, straddling products and services since 2012. My name is Sameer Mehta and I run our Southeast Asia efforts. And I'm delighted to welcome Katherine Desbaillets, the Chief Brand Officer at SaladStop. And today we will be talking about Walking the Talk on Sustainability, rather than pretending to.

We have a great audience today spanning early stage consumer focused founders across the geographies, and I'm sure there'll be some early stage investors as well as interested folks in sustainability. Throughout the session, if you have any questions, please post them in the q&a tab. I will do my best to integrate them as we talk. And if I can't get to your question, then I've allocated some time at the back end to ensure that we get to it.

Okay, Katherine, welcome. I'm delighted to have you. We've been trying to arrange this for a while, but you've been very busy. So I'm finally glad that I've been able to nail you down. We invested in SaladStop in 2016. So actually, you're one of our earlier companies. And you know, at that time, the goal we collectively had was to build the largest fresh salad QSR brand for ASEAN. And the great news is many years later, we are now 65+ stores across seven countries with deep penetration and some very exciting plans in the works. But I think, you know, folks, we have folks from all over, they may or may not be very familiar with SaladStop. Can you dial back the clock a little bit for us and talk a little bit about the genesis of SaladStop, and why it needed to exist.

Katherine

So we started 13 years ago, at that time, we were the first to enter the market as a salad bar. So I think it was really down to perfect timing. And we expanded fairly quickly, we opened 3 outlets in the first year. Because we just need the economies of scale at that point. It's a QSR, it's a salad bar, you can make your salad, wraps, you can make those into wraps and great bowls as well. We have a few warm items on the bar, but mostly raw. And we are focused on plant-based -- a lot of plant-based proteins, on the bar as well so we are about 90% plant-based. And so just a few meat items, mainly chicken and fish. And we are, as you mentioned, seven countries. And we also have another 3 brands aside from from SaladStop. But SaladStop is is the biggest one for now.

Sameer

Perfect. Talk to us a little bit about sort of, you know, I'll use the word sustainability and ESG interchangeably today, although there's an interesting argument to be made that they're quite different things. But talk to us a little bit about how sustainability was built into SaladStop, pretty early on right? So I think walk us back a little bit, if you don't mind, the evolution of sustainability at SaladStop. Why it mattered to you so much. And I know you have some amazing news around the first Net Zero Carbon store, here just in Singapore for those who are based in Singapore. So talk us through that journey a little bit, if you don't mind.

Katherine 

Sure. So it was always part of the company's DNA. Because, just we as a family, when we founded SaladStop, we've always believed in those core values. And so since it started, we kind of evolved with the market as well, we first needed to have an impact and grow, obviously. So we started off by introducing SaladStop with all the different items, we had beef from the menu, we had all the different meats, we just had anything that kind of we knew would please the local palate as well. We then made sure that whatever steps we took in terms of sustainability, the sort of first big one was to remove a few very high carbon intensive items, like beef. But we just really made sure that we did that and educated our consumers. And we also, we were always at the forefront of what was happening. So we were always pushing boundaries. But we also made sure that the market and our consumers were ready for it. And I think that's a really important point. And we at times did make mistakes along the way. An example for that is that five years ago, we introduced the 10 cents charge for our brown bags. And the market in Singapore is not ready for that at all. And so we had to go back to giving them out for free and reintroduce that two years ago, and kind of waited for bigger chains like H&M and a few other retail stores to charge for the bags, and then it went without a problem. So I think we really did test out a few things, a few things did work out, others didn't. And sometimes when we started small initiatives, then realize that actually it did have a larger impact, or we were able to then partner with someone that was able to then spread the word. So I think it was always looking at what was readily available in the market, and also, jumped onto the bandwagon, where we can have the most impact would be packaging. So for us a huge message from the start was reducing single use. And it was not about necessarily the material, it was really the idea of bringing your own container or just reusing the bag, or the bowl, or the cup or whatever it is. So that was, you know, something that we started off 13 years ago. And then obviously the market evolved as well, there was a lot more materials that came into the market. And we were the first ones to test it out. And once again, there were a lot of mistakes that were done along the way. We were convinced by suppliers that certain materials were the best in the market, for example, such as PLA, and we ordered two years worth of stock to then realise that it wasn't, and that we were paying a premium for something that was actually not more sustainable. So I think it's if we're kind of the first ones to push it out to the markets, you will face these kinds of issues. But I think customers have always seen that we made the effort. And again, communication was key during this whole process.

Sameer 

Very interesting. So you know, I took a couple of things I heard right.

One is figure out how you can make a big impact relative to the domain-- the industry, the consumer segment, that you're addressing, and in your case, you identify packaging, which of course makes a lot of sense, given the number of boxes and, utensils and tissues that that's going into it.

The other thing you talked about was learning as the market goes and as your supplier ecosystem matures, right. And what is the push and pull on that.

Talk to us a little bit about this Net Zero outlet. I've been to it, I've had salads there with Frantz not too long ago. But talk to us a little bit about the genesis of that idea. Why, I mean, Net Zero, people increasingly understand what it means in terms of offsets, in terms of materials, etc. What was the genesis of the idea? And is that a desire to have an iconic standalone location, but that can never really be scaled? Or is it a showpiece? But it's, you know, the way the sausage is made? The rest of the time is different? Or is it really the desire to say, “Hey, this is how things can be, and we will prove to you that they actually can work and be scaled across a wider cross section of both Singapore and neighbouring countries.”?

Katherine 

So we started off with a carbon assessment, and we did that in house three years ago. And we wanted customers to have the ability to offset their meals. So at the start it was very simple. And the reason we wanted to do that is we wanted to give that power to our consumers to have an impact. And so we worked with A*STAR in Singapore and we had one person who was just focusing on that, and we got some good results. And we got good numbers that were kind of, I would say correct as per standard. But we wanted to just ensure that we were doing all of this correct. So we partnered with Unravel Carbon, and they then help us calculate the the footprint of the food. But then, everything else as well, which is the operational emissions and the outlet, and the embodied emissions as well.

Sameer 

Yeah, so just so i understand, and for the benefit of others listening who may not be as familiar and tuned in. One is, of course, the raw produce, right? The grocery items that we're buying. Two is the materials that were being used to construct the location. And three is the movement of human beings are associated with the supply chain, right? For end user delivery, and so on so forth, trying to view it very comprehensively. Okay.

Katherine  

Exactly. And also, the reason we did the carbon assessment is that we wanted to see how we could decrease the carbon footprint of our food. So going kind of towards the 30 by 30 goals, it was how can we source more locally? How can we work with local partners to, you know, maybe improve the delivery routes. I mean, there's so much that can be done for us internally, just to decrease the carbon footprint. And that's where we can have the most impact. And obviously, then Unravel Carbon and Pomeroy, which is the architectural firm that we partnered with to build the net zero outlet, work with us and helped us look at every other part of the business. And so for this net zero store, our motto is beyond net zero. And the reason why we emphasise on the beyond, is that we have done everything we could to decrease the carbon footprint of our outlets, to as low as possible and only offset what is absolutely necessary. So I think there's a lot of companies nowadays that that love the marketing term net zero, and they're just offsetting, right? And for us, we really wanted to make it very clear to our consumers as well, that we're not just here to offset all the damage that we're doing, but we're really trying to decrease and continuously improve. And that's why we also really wanted to partner with Unravel Carbon to start looking at, you know, over the years, how can we decrease our carbon footprint by two to three percent. And, also with Pomeroy, looking at creating this very modular system. So the current net zero store is only about 10% more expensive than our current SaladStop stores. So, you know, again, this is our first store. So I would say in the next year, we will be able to potentially match that. So it's not a higher cost. And it's also it can be adapted to the market. So we really made sure that this can be replicated in every other market and it can be localized. So it's really about looking at local wood refurnish furniture, so the playbook that we've created with Pomeroy is very easily adaptable. And there needs to be, as a QSR, and looking at expanding very aggressively over the next few years, we have to ensure that this was, you know, something that could be replicated.

Sameer 

So this, thank you for that, it's very interesting. It leads us to the next natural question, which is what we hear a lot from from early stage consumers, right. Increasingly, when me and the rest of our team assess investments, we have very clear ESG filters that we apply, right. And I guess in our case, they're not exclusionary yet. So we don't say we will not invest, but we will identify big risks, and then work with the founders to say we have to address these risks over the next number of years. But what we keep getting pushback on -- and I think it's fair pushback, I have empathy for the pushback, which is “Sameer, I'm barely out of the crib, I'm an early stage company, I barely exist. This is too much of a burden to have to think about, right?” And I'm not saying that's all founders, it's a subset. But certainly, there is that position. So how do you address internally, the supposed challenge between being sustainable, and viewing it as a cost and as a burden of doing business, versus potentially an accelerant or something that your business stands out for. So how did you guys think about that? 

Katherine

I think that looking at overall kind of all our sustainability initiatives -- it definitely comes at a cost when we're looking at certain materials that have to be purchased. Our packaging is more expensive, but I do think that we make up with that with a slightly higher price and I think consumers are then ready to pay that slight premium. And we try to find smart ways to push. For example, with the brown bag, we did have the 10 cent charge, some customers were very unhappy about that. Therefore, we introduced the borrow bag tree. So it was just a hat hanger that we bought at the Ikea for all outlets. We have our customers give us old recycled bags to hang there. So customers that really didn't want to pay the 10 cents could just borrow a bag. And the outlets actually really got involved in this process. They went to nearby hotels, got the old bags from the hotels, hang it on the on the tree and became a little bit of a competition within outlets. So it's all these little things, again. To the consumer, it's just shows them that there's a lot of effort done to eliminate single use and to get--again, consumers involved bringing their bags, getting the outlet team members to get involved as well. And it really doesn't come at a cost. So I would say really looking at what we are currently doing, I wouldn't say that there's anything that is more expensive than if we were not sustainable, the only thing could potentially be packaging. But again, we would add that into the price, so that's a slight premium. Everything else would just be the same. And we try to you know, it's the same with local sourcing. Surprisingly, I mean, local food is more expensive than imported food. But again, we educate our consumers on that. And when we push out a 100%, local, seasonal, it is the highest priced salad on the bar. And we do get questions, but it's a great way to engage. So I think it's just about, it's about being smart about it and just introducing again, maybe it doesn't have to be huge, it's small, little steps, like we give a free topping if a person brings their own, you could say, you know, we're not using one of our bowls, and that we can save on that cost. And so it does kind of balance itself out. If we give 50 cents for if a person brings their own cup. So it's a lot of small initiatives that are impactful in their own way. But it's not really a burden for us at this point.

Sameer 

Got it. Very, very interesting. And I think, what I want to talk to you a bit further about is this consumer premium angle, right. Like, there's a massive amount of research. I track a lot of this research, McKinsey came out with something which was largely US data, I would say around, consumers are now willing, able and have demonstrated a desire to pay a premium for things that they can understandably view as sustainable. In Asia, when we do this research so far, and I'm talking about all aspects of Asia, right. So I'm not talking about Singapore, which is one of the world's affluent cities. I'm talking about Indonesia, I'm talking about Vietnam, I'm talking about countries at various different levels of development. The stated preference for "I would like it for it to be sustainable" versus the exhibitor preference of "Are you happy to pay a 10%, 15% 20% premium?” for something that's sustainable. There is a lot of gap between my statements of what I would like to do versus my exhibited behaviors, right. Now, of course, our view is that that gap will close, more and more people will behave the way they tell you they want to behave. But how do you view that gap today? You operate in markets that are a combination of developing and developed, how do you view this gap between the consumer wants sustainable, but is unwilling to pay up for it? And then we have to do some clever things, I don’t want to use the word -- hide it, but slip it in, in a way that they don't understand the price of what being sustainable means?

Katherine 

Yeah, so we've tested this in the net zero outlet. In all of our other outlets, we give customers the option to offset their meal. So they have to opt in. And for the CapitaSpring outlet, we automatically opt in. So they actually have to opt out if they don't want to pay that amount, and in Singapore, it's 20 cents. So I mean on a $18 bill, 20 cents is minimal, but we saw kind of a 90% success rate on that if they automatically opted in, so only 10% would opt out. But if we give them the choice to opt in, it's 3% that opt in.

Sameer 

So this is human psychology coming to the fore, which is designing things in a way that takes decision making almost out of the hands of the consumer and guide them to the right decision.

Katherine

Exactly. And you see that a small percentage will be very upset because maybe it's not clear enough, and it's not, you know, that they were not aware that they would be charged 20 cents. But I think overall, it went very well. And I think it's definitely something that we'll continue to push. And if customers do write in, we'll tell you: "Okay, you're offsetting, I think, once again, very important is that we are also doing our part". So they're offsetting their meal, but we are offsetting the whole store.

Sameer 

Right, Got it. Understood. Okay. So what I'm hearing is, listen, there's some stark, smart consumer design that can help you get the resources to do what's right. And there's some experimentation required to figure out where your consumer, in any given geography, any given domain, what he or she is willing to embrace.

Shifting focus a little bit to B Corp, we have a number of companies in the portfolio that are either B Corp certified or on their way to being B Corp certified. I know you're on the way to getting B Corp certified. Just to get our audience up to speed, because not everybody may be familiar with B Corp, it'd be wonderful if you can share what the B Corp certification is. Why is it important? And how are you planning on getting there?

Katherine 

Yeah, so B Corp, just basically companies that are verified by the B Lab to meet the highest standards of social and environmental performance. And I think most importantly, transparency, and accountability. And for us, the reason why we're embarking on getting the certificate is that we want to cover all aspects of sustainability. I think, being in the F&B, we focused a lot on the environmental side, obviously, for us, food, local sourcing, packaging, and all that. And we did realize in the process that the social side has taken a backseat. So this has really pushed us to look at, you know, the company as a whole. And also to get the corporate team a lot more involved and the the team on the ground. So, you know, for us, net zero was a great start, but I think B Corp really looks at a lot more.

Sameer

You view it as an extension of the good work already done a net zero and a natural end point.

Katherine 

Yes. And also keeping that kind of accountability moving forward and to track everything. It's something, that I mean, we've always push – see I mean we're no experts, so we're also learning as we go. But I think this kind of gives us a good framework.

Sameer  

Got it. Interesting. I mean, it's relatively consistent with what some of our other companies tell us, right, about the motivation for it, the work required to get there is more expansive. But it's a journey, it's not something you can just turn on overnight. Culturally, you have to be ready for it. But it's a worthwhile journey to go on. You know, let's think a little bit about sustainability also, from the lens of business results, right. Ultimately, we are building economic engines, which deliver things for people in the form of improved livelihoods. Given that a lot of the work we do is in developing Asia, livelihoods is where it all starts for us, right.

We at DSG, interestingly, today is the launch of our first sustainability report. Very proud of that. It'll be going out in the public domain, we'll see what response we get, because we are starting with the position of we invest in India, Southeast Asia, and Southeast Asia is beyond Singapore. My first objective, our first objective is to allow economic engines to prosper, which means improvement for people with prosperity. Absent that it is very hard, in our opinion, to accomplish much, on the peace and planet side of the equation, which is something that the UN Sustainable Development Goal framework lays out, right. How did you go about prioritizing it, if at all, you ever thought about it in that lens? Because our view is that a lot of it is just a balancing act, right. You have to have a real business, without which you can't make the investments required to deliver anything on the planet. Did you think about it in this way? Or did you just pick things across the board and start delivering them faster? Just wanted to get your sense of how you thought about it.

Katherine  

Exactly that. I think we never had this grand plan. We were just implementing sustainable initiatives wherever we could, over the years. And you know, things just happened. So then again, with the net zero it really, we are here today, but three years ago, we never thought that we would have a net zero. We never started with the aim of going net zero and just the right partners came in at the right time. And now, obviously with this first net zero store, because we've seen the success of it, and I think our partners internationally as well, are very interested with this idea. We have now planned to go net zero by 2030.

Sameer 

The entire footprint? Wow, amazing. 

Katherine 

So now working towards that. And eventually, I mean, getting the B Corp for Singapore, and also then pushing that out to our international markets.

Sameer 

Makes good sense. You know, I think the one interesting lens here for a lot of folks listening in, thinking about what they do in their various businesses or what it is, you know, taking small tangible, measurable steps, right. That's actually I think one of the title things in our report, which is, there's a lot of tall, empty promises, the amount of greenwashing that's happening across the board is really quite impressive, at some level. People are raising funds against ESG. And then you delve into the funds and you realize what's actually happening. You have ETFs that are publicly listed that talk about we are a Green Fund, and then they have, you know, the oil majors of the world as large holdings. Yeah, exactly! The beggars belief, to me. Our preference, and what our advice tends to be, just make small, measurable, tangible steps. And I think you use a really important word today, which is hold yourself accountable. Even if no one is watching, if you are holding yourself accountable, you will be on a positive step towards that journey. Understood and very clear. 

So on that. On that subject, I have a question that I'm going to impose on you. What are couple of major levers from a value chain point of view where the premium that we talked about right, where being green requires having a premium to the consumer? How could you flip it, where, by virtue of being green, being more sustainable, you actually benefit from a discount? How have you ever thought about that? Which is we do all these great things, we should get some benefit from this, for ourselves. For the consumer, why must it cost more? You know, I don't know if you have any interesting thoughts on that.

Katherine  

So we do incentivize customers, if they bring their own containers, if they order a plant based meal. And we also have our own app, and loyalty, and pre order, and we also reward customers for being sustainable. So we have. We think that's really important. And that's been added to our loyalty in the last kind of three years.

Sameer  

Give me a tangible example of that, just so that it activates people's imagination. So I come into the SaladStop store, and I say, okay, today I'm going to choose to be healthier, and choose to be better for the planet, and I'll go plant based today, right? And I accrue some credits in the form of loyalty points that are different than if I had ordered an animal protein meal.

Katherine  

That's it, or you would get so currently, you can choose seven toppings, is standard toppings, you would get an eighth, if you order plant based. And if you bring your own bowl, then you'll get a ninth topping. And so you get two extra toppings.

Sameer  

Got it. Do you find that consumers are taking advantage of this? Is this that that drives behavioral change, which is ultimately what we're trying to nudge into the direction of?

Katherine  

So that's really interesting, because we did this study with Muse. Muse is a Singapore based company that started with reusable bowls that you can borrow from the store. So you just scan the QR code, you can borrow and then return. Okay, so they pushed out a promo for one full month that was $2 off that they funded, $2 off per salad if you use their bowls. And we saw 20% uptake for that month, because there was a $2 discount. And normally our uptake for BYO, so "Bring Your Own" or Muse, is 3% for that outlet. What's interesting is after the discount was over, that number came back to 3%. So it was not about making that conscious eco decision but it was because I get the $2 off so I'll make the effort.

Sameer  

And interestingly there, the behavior was not sticky enough to survive the lack of a discount.

Katherine  

Yes. So even though we introduced that convenience, because, you know, we really did believe at the start that the reason why people didn't use reusable containers is because you forget it at home and you know it's just not convenient in store. And we realized that actually is not the case they will go out of their way to scan a QR code get a bowl, if they get a higher discount. So the free topping didn't move the needle, but the $2 did.

Sameer  

Got it. Well, I think Shiv, we don't have great answers for you, I'm afraid. But what we do know is that if you could indeed deliver a discount for being better in this very specific practical way, then the uptake becomes very significant.

Katherine  

Yes. And I wish I could say that, then you would, it would somehow stay there. But unfortunately, in our tests, it hasn't.

Sameer  

So maybe we'll figure something else out. One of the questions that my team was very keen on having me ask you, right, was early stage founders do what an early stage founder wants, I know you'll say you are still an early stage founder. But they often ask, “Hey, how do I start? So I am young, I care about the planet, I care about reducing my footprint. I don't want to put a bad product out in the world or bad service out in the world. I want to start with better behaviors from day one, as a company. How do I go about starting?” And I'll share some examples from the view from other companies as we start talking about this, and what I have seen our other founders do at a very early stage. But how would you provide advice to someone? With all this years of experience, this journey that you've been on, leading to net zero, leading to B Corp in the near future, if you have to roll back the clock, could you give people some advice on ‘Think about these three things when you get started’.

Katherine  

So I think, for us, it was always about being honest and transparent. So we always kind of pushed out this message that we are not perfect, but we're trying to be better than yesterday. And, you know, that we couldn't implement everything at once. You know, as I think we discussed before, you still ultimately need to be successful as a business. But we communicated this with our customers all the time. So I think it's really about offering a product that is honest, and that fills that specific gap, and really being able to pinpoint what that is. So when we first started SaladStop it was just healthy food, salads. It just wasn't the market.

But we wouldn't have evolved very quickly, we would have just fallen behind very, very quickly, because the market just evolved so fast. So then we had to constantly evolve. But our main message was always to be honest and transparent, and to deliver the best product we possibly could in that category. We always ensured that, our products were, that the core, which for us was salad, so the core of our ingredients were always of the highest quality. So that's something that was number one priority. So doesn't matter how many sustainable initiatives you do on the side, how beautiful your packaging is, if the core product is not tasty, fresh, and what people expect, you're just not going to make it. So that I think was was the focus from day one. And then everything else was secondary.

Sameer  

Very interesting. And I think this speaks to a question that somebody sort of tagged in here, which was, is sustainability an add on to, or a differentiator, when all else is equal? So if I have two comparable things, which I know is hard in food, but let's say we could idealize two comparable things, then I will choose a more sustainable option, all else being equal. It's what tips things in your favor, but it is not what creates the impetus to change. Is that a fair way of describing it? Absolutely. Okay. Interesting. No, but that is very interesting. And by the way, our research in Southeast Asia so far corroborates that. Which is, being sustainable and being demonstratively sustainable, certainly helps, but it is not a key consideration. 1, 2, 3, 4 or frankly, 5, right. There's five other things that come before sustainability hits the agenda. Yes. And that's why for us and our founders is very interesting because again, the noise of the research versus the reality of how customers are behaving, there is a lot of dissonance that needs to be bridged. Very insightful.

Katherine  

And again, I think we're not just looking at immediate results. We're really looking at progressing, and what we do for the next 10 years. So I mean, the journey to net zero is not something that can be done in a day. I mean, it's a very long process. So even if we feel that our consumers might not understand the whole message, or at the moment, you know, they don't choose us over another salad bar that might be $1, cheaper, but we're really looking at this long term.

Sameer

So on that long term, you know, we're in the business of investing in very early stage businesses, sometimes pre product, pre revenue, often times, there's some product or service, but very little revenue. So we're always building 10-15 years out. That's what we're thinking about. So on that note, if I could get you to put your magician hat on and your crystal ball in your hand, as you think about trends in sustainability over the next 10 years, are there two or three things that in your mind, you'll see step changes coming? Which are not as well understood by folks who are not operators in the playing field, battling it out.

Katherine 

So in the F&B space, I would say definitely plant based. And I think in the health space, really looking at nutrition down to a personalized level. And kind of having all of that integrated with sustainability. So looking at eating locally and kind of F&B establishments being transparent about that information. And I still think we can see it with airlines and hotels, the offsetting part. Offsetting your trip, offsetting your stay offsetting your food. I think that's something that can go across all industries. And it's where consumers can play their part. And it's something that's very easy and straightforward. So I think that is here to stay as well.

Sameer 31:38

So I heard plant based food, traceability, sustainability, on the source of ingredients, if you will. And third is heavily personalized nutrition, which is what I'm individually very interested in. But let's tackle all three, because we have made investments in plant based companies, as you know, and some of them are suppliers to you. We appreciate that. We're looking at personalized nutrition very, very carefully as a long term investment theme. And increasingly, I would say more and more of our food businesses are looking at their supply chains, irrespective of whether they're fully integrated or not, and asking for more traceability into their supply chains. And then the suppliers will react to that. Because if there's consumer demand, then you know, the backward flow will take place. So let's talk about plant based. What's your sense of the take up rates for plant based food? Let's maybe just talk about Singapore as a starting point, right? Is this something that you see as something that will be 20% of us will become flexitarians in some way, shape, or form in Singapore, where we will have anointed plant based days or anointed plant based meal times where you know, all my lunches are plant based, all my dinners are plant based. How do you hypothesize that panning out because, as you know, plant base has gone through its hype phase, I'll call it, over the last two, three years from an investment dollars point of view, from a valuation point of view, and now, certainly, I don't want to say it's doldrums time, but it is a more challenged sector from an excitement point of view. How do you view that?

Katherine 

So I think when we first kind of saw the whole plant based craze and especially in the protein space, so plant based protein alternatives, it was very highly processed. So we had Impossible, Beyond Meat that came in. I think maybe consumers were a little bit reluctant. Because the trend towards plant based is also kind of a health journey, right? Like people wanting to eat more healthy. And so, it was quite contradictory at that time when all these players came into the market. Now that we're seeing more whole foods that give the same texture and the same tastes such as Karana and Fable, I think we should be seeing a much bigger shift. And also, obviously the educational side, and that's what we're pushing heavily. So we need to say that the protein, that you can still get enough proteins, you can still get enough amino acids, you can still get all of that nutritional benefits from this plant based. So I think definitely with all these new, healthier, alternatives coming into the market, we will see a shift. And we see it ourselves. I mean, we've seen a huge shift in the last two years.

Sameer 

Okay, so good. So your long plant based, that's music to every founder building against that theme. Let's talk a little bit about personalized nutrition. So let me give you what I would like to see. So I have like most human beings limited willpower, right. I talk about wanting to be healthier and leading a healthier lifestyle. But as the day progresses, and my willpower recedes, because I have a cognitive load, I'm making decisions. I'm thinking about other stuff. When it comes time to make a decision on what to order, whether it's at a SaladStop or any other place, I will often make unwise choices. What I want is if you could just scan my phone or my watch, and say, we have 100 menu items, but really the only three that matter to you, Sameer, because you have these goals, this is your calorie count for the day, here's how many steps you've taken, here are the three options you get. They are perfect options for you, the tasty options, you take the cognitive load away from me. Is that one example of personalized nutrition that you see coming down the pike? Because my view is we have to take friction out of the consumer experience, the more decisions consumers have to make, they rely then on what is comfortable, what is easy, versus what is wise.

Katherine 

Yeah, absolutely. And that's exactly what we're working towards. It's really also to integrate with fitness apps, with your Apple Watch. So you can track everything from the exercise that you're doing, to the food you eat. With the exercise that you did this morning, how many calories you're eating, how much protein you should be having. And because all our concepts are based on portioning and creating your own, we can create millions of different variations. And I think that's where we see this great fit. Is that we're really able to customise the perfect meal for every individual.

Sameer 

Got it. That would be amazing. I'm looking forward to that day. I don't have to make any decisions about what to eat. Okay. An interesting question, which is a little bit different than what we thought we would talk about but I think it's very interesting. John asks, around, you know, F&B staffing, which is notoriously difficult, right, QSR, retaining, motivating QSR staff is very challenging. We see it across all our businesses in India and Southeast Asia. Is the sustainability programs or ESG programs an advantage in attracting and retaining staff? You know, are there other things that you do around the communication of ‘what we stand for’ that attract a particular kind of workforce? So that's how I'll sort of pitch that question to you.

Katherine  

So definitely, I think that for our team members that have been with us for many years, they've stayed because of what we stand for. And so I think you do get the longevity? You know, if for an immediate hire, might still be trickier. I mean definitely in the corporate office, most people that join us have a passion for the brand. But I think in the outlets themselves, we do a lot of training and sustainability is a big topic. And we have seen that a lot of our team members speak to us to say that they're eating so much better, they've influenced their own families. So it does change them and their whole ecosystem. And we've seen that happen a lot. So we do have talks, as well, at the corporate office, on health. We have an in-house nutritionist that speaks to the team members as well. So we are trying to really build that ecosystem that will be able to improve everyone's lives. And it definitely is transcending down to everyone, even down to the to the outlets.

Sameer 

Okay, that makes sense to me. Again, you know, when we see what works at other QSR or you know, even retail services concepts, some connection to the brand, and brand identity, and personal identity, meshing of that, is quite important. So it's great to hear that. That's one of the reasons that folks come to you and stay with you on the app. I'm looking at other questions. I think we've addressed some of these questions already. Let me ask you something I wanted to talk to you about, because I think you've done a lot more thinking about this than most right. One of the trends that we increasingly see at DSG with folks building around food is this idea of food as medicine, right? We eat three times a day, sometimes increasingly more, many more times a day, because people are having either much smaller meals, or they're foregoing meals and having 6, 7, 8 snacks a day, rather than having full meals. But as we understand many aspects of gut health better, what we're doing to our guts via the food we put in, is becoming, I would say, at least at the cutting edge. More and more awareness exists. Beyond the personalization component, is there any other way you think about this food as medicine trend? And how do you then build that into the SaladStop proposition, whether it's from the existing QSR salad concept, or any adjacent concepts that you might be considering?

Katherine 

So, again, I think we're always looking at having the basis as being whole foods. And, you know, when we bring in any products from partners, take Karana or Fable, and it's not kind of a raw product, we make sure that it's as clean as possible. So I think that has always been important. And again, I think healthy is really a buzzword as well, like what's healthy? I mean, you know, if somebody was to eat a salad with a really heavy caesar dressing with a lot of mayo and sugar, that would not be considered healthy anymore, right? So I think for us, we've always looked at it, and again communicated as "we are transparent" in that sense, that we are as clean as we possibly can be. And I think it's just all part of that educational journey, and for customers to be aware of that. I think what you mentioned before, people kind of don't know where to start. And there's always these misconceptions of not getting enough protein or that you'll be hungry after a salad. So it's really just showing to people that you can have, you know, all your meals that are that are healthy and get all the nutrients that you need, and that it pays off at the end, and you can you can really feel the difference. And we have customers that come to us five days a week and they eat you know, SaladStop for lunch and dinner. And they really say that they see a big difference. They don't feel that tired at their desk at lunch. It's I think just more and more people feel that food affects everything, even your mood, and your focus, and your energy levels. I mean, everything. 

Sameer

I'm excited about as some of the tracking devices, the Apple Watches, the Oura rings, the Whoop bands, there's any number of them, just talking about the ones that I know somewhat. That is starting to give all consumers, and again, these are relatively educated, a bit forward thinking consumers, so I acknowledge that it is not the belly of the market, it is the tip of the spear, but a lot of people I know just in my friend circle, are looking at, oh, I ate this, and here's what my tracking device is telling me about my blood sugar, or it's telling me about XYZ, right. And as this technology improves and gets integrated, that I think people's ability to figure out what food groups to exclude for themselves, rather than making the very drastic plant based or not plant based choice because there are too many meat lovers and I will put myself in that category, feels too drastic. But if I knew that during lunch avoid it, because you're not going to be productive. Or really ‘Sameer, steak is not for you anymore, your body can't process it very well, so certainly don't eat it at night,’ which is sort of what I've learned accidentally. I think this will be a big catalyst, by the way, for plant based in general. Because as we learn more, folks will be able to make better decisions for themselves, rather than sort of, trial and error-ing their way in, or having to make some very drastic choices, which I think a lot of folks are not ready to make yet about saying I'm gonna become completely vegetarian or vegan, if culturally I didn't come from a place where that was normal. 

I'm asking for the last set of questions. So I've already taken up a lot of Katherine's time, so I don't want to keep her on much longer. So I'll take the last couple of questions if anybody has anything. Just going back and seeing if I've skipped over something. Don't think i have. We've talked about the consumer premium and the fact that it's not clear whether there is a deep desire to pay it yet. But do you have to build it in in other ways. We talked about trends a little bit, about what's coming down the pike. Okay. Well, if there are no other questions, thank you very much, Katherine, really appreciate you spending an hour of your life with us. I'm very excited about what is to come. We at DSG are very excited about what's to come at SaladStop. I think the next three, four years will be very, very important for us. And I think you are, in some sense, an icon bearer for Singapore, right? On the QSR side, they're not many F&B chains that think, behave, and act like you. And that's why we felt it was really important to get you to talk about sustainability because you have so many accomplishments to show for about actually doing something rather than just talking about it in words. So thank you very much for joining us, and I look forward to speaking to you again, take care.

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