Introduction
Stopping single-use plastic is easier said than done. Too many products are wrapped in thin, unrecyclable plastic or metal packaging in grocery stores. And in bulk isles, customers are often invited to put their products in…plastic bags.
Efforts have been made to address the problem. Some stores provide compostable plastic bags for bulk isles. But it still uses energy and raw materials for single-use items. Other stores allow customers to come with their own recipients. However, it quickly becomes difficult for cashiers to deduct the weight of a glass jar or a cotton bar from the bill.
To solve these challenges and finally move away from plastic, TAINR innovated the bulk aisle experience by creating a smart refill kiosk. We reached out to co-founder and CEO Camilo Giraldo to understand the company’s strategy to become a must-have for natural grocery stores.
In your own words, how would you describe your company?
TAINR is a retail technology for packaged goods. Our smart refill kiosk eliminates the need for single-use plastic packaging and reduces the inefficiencies that come from managing packaged goods. We streamline sales operations with real-time inventory management and optimize supply and demand operations – all while providing a convenient, hygienic, and sustainable shopping experience.
What inspired you to take the leap and start this company?
Every time I came back from the grocery store, I’d look at the pile of plastic packaging on my countertop – 90% of which was unnecessary for shelf-stable products like nuts, rice, coffee, and cereal. After trying and failing to adopt the bulk aisle to opt out of plastic, I repeatedly asked myself the same question: “Why is it so hard to buy food without plastic waste?”
As we dug into this (literal) mess and discovered that packaging accounts for 43% of overall product costs and causes inventory complexities and billions in lost sales every year, we thought these issues presented a great opportunity for innovation! And since Kathy and I had access to top-tier engineering talent and an advanced prototyping center in the nation’s third-biggest manufacturing hub, we set out to build a solution.
Who is the founding team and how did you come together?
The founding team comprises Kathy Silva, COO, Philip Tomasi, CTO, and myself as acting CEO. Both originally from Colombia, Kathy and I met while majoring in Chemical engineering at the University of Florida. We have similar experiences in large-scale manufacturing for companies like PepsiCo and General Electric.
Working in manufacturing taught us the importance of process efficiency to generate profitable products by maximizing raw material conversion with minimal waste. Despite this effort at the production level, there’s a disparity when products hit the market. With more than 50% of the material turning into waste after its short life cycle, it is estimated that 380 million tons of plastic waste is generated every year, primarily from single-use plastic packaging. This negatively impacts all stakeholders while putting ecosystems and vulnerable communities at risk.
Motivated to bridge the gap between planet and profit, we landed at Los Angeles Cleantech Incubator, where we launched a product development firm guided by a cradle-to-cradle approach. Working on helping Fortune 500 companies bring sustainable products to market, we met Philip Tomasi, a serial inventor known for inventing what is now the Redbox DVD vending machine. Together, we transformed numerous ideas from concepts to production. Our mutual passion for the food system eventually led us to find TAINR together.
What tells you that Americans are ready to shop using TAINR?
Plastic pollution has touched every corner of this country. Plastic waste is ubiquitous everywhere we look, from our local parks to remote beaches and within the pristine landscapes of national parks. Our bodies have not been spared, as microplastics have been detected in our blood, lungs, and, most recently, our hearts. The alarming reality is that each of us ingests the equivalent of a credit card’s worth of petroleum-based plastics every week.
This plastic crisis is entering the American conscience and driving a compelling shift towards plastic-free alternatives, especially among younger generations paying up to a 30% premium for sustainable alternatives. It’s not a coincidence that zero-waste stores have popped up nationwide in the last five years – and they’re thriving. Customers expect safe, fresh, great-tasting food on demand. They’ve been ‘sold’ the idea that plastic is the only convenient way to get their food home.
The grocery store is the most frequented retail space in America and is ripe for transformation. As conscious consumers actively seek plastic-free alternatives, grocery retailers and major CPGs recognize the market opportunity. Industry giants like Whole Foods, Target, Kroger, Nestle, and Coca-Cola are making ambitious public commitments to shift towards circular and reusable packaging. Further fueling this transition are the waves of plastic legislation sweeping the country, enacting bans on single-use plastic and signaling a broader societal shift towards reducing plastic consumption.
What is your go-to-market strategy?
TAINR will launch in natural grocery stores, replacing outdated and problematic bulk aisles. Positioning these stores as our early adopters is a strategic move to showcase the resonance of our product within a dedicated and engaged consumer base.
The grocery shopping landscape has shifted dramatically since the pandemic. Sales in the bulk aisle, once alluring to stores because of its higher profit margins, have declined significantly due to hygiene and food safety concerns. Given the high operational costs, this downturn has prompted many stores to reconsider the viability of maintaining this section.
Unlike larger chains, natural grocery stores have ingrained bulk offerings into their DNA and present an opportunity for us to demonstrate the alignment of our solution with their ethos and shoppers’ preferences. By introducing TAINR’s technology, we aim to modernize and optimize their bulk offering, addressing the operational inefficiencies and hygiene concerns that have emerged post-pandemic. Their willingness to embrace our solution will serve as a compelling validation of our product-market fit.
What is your break-even point in terms of revenues and number of kiosks?
Our breakeven point is 628 kiosks. On a (3) kiosk per store basis, the equivalent average real estate dedicated to the bulk aisle, we must deploy in 213 stores to break even.
What does the competitive landscape look like, and how do you differentiate?
We face competition from players offering traditional bulk solutions and semi-smart refill stations operating in the U.S. and Europe.
Our system is different in requiring no installation and occupying less space while storing more products. At a time when stores are reeling from record-high labor shortages – 6.3 million retail workers quit last year – TAINR offers real-time inventory data, optimized supply & demand forecasting, and the ability to slash labor costs by half.
Most importantly, TAINR ensures a 100% contactless dispensing experience, addressing hygiene and safety concerns. Our patented and connected technology further empowers brands to offer personalized and diverse products through our software-enabled solution, enhancing brand loyalty and recognition among shoppers.
Our distinctive edge lies in our autonomous technology, enabling TAINR to scale beyond the grocery stores. We can expand into unattended settings like college campuses, airports, and sports arenas. This adaptability makes us an ideal choice for any location where vending machines are present. TAINR’s autonomous system aligns seamlessly with evolving consumer preferences for a convenient, secure, and customizable shopping experience.
What milestones do you want to achieve in the next 12 months?
- Complete the product development of TAINR 2.0 – a deployable system.
- Onboard developers and engineers.
- Set up small batch manufacturing.
- Deploy with our first Southern California account a 4-kiosk installation in Q1 2024.
- Complete a successful 6-month pilot contract and expand to 5 stores and 30 kiosks.
TAINR is raising on Wefunder.
