WORK
Revitalizing Japan’s Food Industry Through Design and Software
Redefining the “middleman” role of produce wholesalers in Japan
The Challenge
Address large-scale issues facing regional farmers in Japan.
The OUTCOME
fudoloop, a communication tool that provides up-to-date production information from farms, boosting profitability for both producers and agricultural wholesalers.
In recent years, due to shifts in Japan’s demographics, the food industry has faced challenges such as a decrease in market size and a shrinking number of producers. As a result, social impact opportunities abound in this field.
When Japanese software company NJC (Nippon Jimuki Co. Ltd.) approached IDEO seeking to identify new business opportunities that would build on the company’s core strengths, the food and agriculture industry rose up as a promising area of focus.
NJC is a well-established software company that has spent over 50 years helping to build backend business systems for small to medium enterprises. NJC works across healthcare, retail, and food and beverage, computerizing core processes to support and improve operations.
In partnership with IDEO, NJC explored its strengths and potential as an organization, as well as the ideas and visions of the employees, and emerged with the goal of using their capabilities to address large-scale issues facing regional farmers.
During research across Japan, local growers described challenges with multi-layered supply chains and analog systems, which led to “overwork for minimal profit,” as well as a gap between supply and demand. Because agricultural wholesalers lacked clear information in advance on the status of crops or the volume to be harvested, they struggled to negotiate with buyers, which led to wasted food On the other hand, the farmers who grow the crops are engaged in manual labor, and do not always have the energy to focus on business aspects such as efficiency or the pursuit of increased profitability, which leads to a diminished interest in farming among young people.
One president of a produce wholesale business made frequent visits to farms, checking on the status of crops and estimating the shipment volume. The team identified the relationship between wholesalers and farmers, who haven’t shifted much toward computerized systems, as an opportunity.
One question that emerged through research was why agricultural producers weren’t utilizing IT. This evolved into “How can profitability be improved for all stakeholders?” and, “How might we create a system that will provide useful data without creating a burden for either farmers or agricultural wholesalers?”
The result was fudoloop.
fudoloop is an app that enables farmers and wholesalers to conduct business more profitably by bringing transparency to the fluctuating produce market. Through fudoloop, wholesalers receive information from farmers a day in advance, and can coordinate the various requests of buyers, such as order size, production location and other special requests. As a result, wholesalers can function as “community managers,” doing business with both producers and buyers at a more appropriate price point.
To test the initial concept, the fudoloop team set up a booth at a large-scale agricultural trade show. Industry participants were asked to test the system, providing effective feedback that helped streamline the focus of the project and allowing the team to identify latent markets.
NJC aims for fudoloop to be the first step in a cycle that brings value to all stakeholders, from farmers to wholesalers, retailers and even customers, by redefining the “middleman” role of produce wholesalers.
I learned firsthand that innovation doesn’t require amazing cutting-edge technology. Innovation happens when simple, human-centric ideas are brought together.
Kenichi Sato, CMO at Nippon Jimuki Co.,Ltd.
2019