Food safety fears heat up delivery services

by Shinichi Tokuda

As consumers become increasingly sensitive toward food safety issues, some food delivery service operators are getting brisk business by ensuring the quality of the produce they sell.

Their businesses have expanded amid consumer anxiety about mad cow disease and agrochemical residue on vegetables.

The delivery companies make extra efforts to ensure the safety of the food they handle through such means as gathering detailed information about production, including the methods that were used to catch or farm fish or raise livestock.

The reward has been growing popularity, particularly among families with young children as well as senior citizens who consume less food but want that small amount to be of good quality.

“Because our business started based on the desire to protect the environment and the safety of food, we only sell items that have met our rigorous quality standards,” said Masaya Koriyama, a spokesman for Radishbo-ya Co.

Radishbo-ya, founded in 1988, is a relatively long-established company in the food delivery business. The Tokyo-based firm started out as a nonprofit organization focusing on recycling but expanded into delivering organic or relatively chemical-free farm produce to registered members.

It had 5,800 households signed up in its first year, and the number has now soared to 76,000. Annual sales have jumped to an estimated 19 billion yen for the year ending this month, from about 1.5 billion yen in fiscal 1988.

Some 2,100 farm operators around Japan are under contract with Radishbo-ya to supply chemical-free produce every week. The firm deals in about 4,000 items, including household products made with environmentally friendly materials. Product catalogs distributed with deliveries offer recipes for dishes made with seasonal foods.

“Due in part to the recent mad cow issue, an increasing number of food processing firms are now asking us to handle their products as proof of their safety,” Koriyama said.

A similar formula of signing up farmers who promise to abide by safe food production methods has proved successful for another Tokyo-based firm, Oisix Co., which offers to deliver even just one item.

The online food marketer, created in June 2000, saw annual sales shoot up to an estimated 2.8 billion yen for the year ending this March, up from first-year sales of 78 million yen.

It offers 1,200 items, such as organic produce cultivated by 1,000 farmers across Japan, as well as processed food.

The company has also hit on a highly effective idea for expanding its customer base. Besides online marketing, it sells food through the nationwide network of more than 300 milk delivery outlets. The revenue makes up about 30 percent of Oisix’s total sales. Milkmen distribute fliers advertising Oisix products to customers and pick up food orders when collecting empty milk bottles.

“We mainly serve younger customers through our Internet-based business, but many of the customers who have their orders delivered through the milk service are in their 50s through 70s,” said Oisix spokesman Kuniaki Mishima. “Items made with healthy ingredients that can be eaten in one meal are particularly popular.”

Selecting reliable suppliers is also a key concern for cooperatives striving to meet consumer demand for healthy food.

Co-Op Tokyo began a delivery service for its food and household products about 10 years ago. The number of registered customers has grown to well over 400,000.

The cooperative distributes fliers advertising 1,800 items to individual households. Although such ads do not necessarily specify whether the listed produce is organic, the cooperative sells only products it knows to be safe from information it gathers about who produced them and what ingredients have gone into their production, according to a Co-Op Tokyo official.

Growing public anxiety about food safety is creating opportunities for firms to make new inroads into previously untapped market segments and is already transforming the way many companies do business, according to observers.

The increased public awareness will likely prompt companies to come up with even more innovative initiatives and new business models.