The Company Founder Putting Values, Sustainability, and Employee Wellbeing First
Ian Walker was twenty-four when he co-founded Left Coast Naturals. He did not have an "aha moment" or some grand desire to start a "big, fancy business," he says. Rather, the opportunity found him when a friend had the idea to create and sell a natural nut butter. Walker and his business partner dived in without any knowledge of how the food industry worked. But one absolute guided them: "I knew that if I started a business," Walker says, "I really wanted it to mean something."
That was in 1996. Today, in its more than twenty-three years in existence, Left Coast Naturals is a revered manufacturer and distributor of organic and natural foods. Based in Western Canada, the company distributes nearly thirty brands and more than 200 natural and organic bulk foods to over 500 stores. It also creates three of its own natural brands including Hippie Snacks, maker of the popular Cauliflower Crisps and Avocado Crisps, which are available across North America.
Everything Left Coast Naturals is involved in falls back on Walker's north star of wanting "it to mean something." The products they create and distribute are "better for you," as Walker refers to them. This means they're free of genetically modified ingredients and come from sustainably-focused efforts. Walker and his team make it paramount to know the values behind the brands they are working with, from the farming conditions of the ingredients they source, to how the employees are treated. Intention and effort is telling, Walker says. "Who you represent and what your products are show who you are as a people."
A Q&A with Ian Walker
What was the catalyst for getting into the distribution business?
No one would do it for us. We were two young guys who had no contacts in the industry. We went to a bunch of distributors and they kind of laughed at us so we started delivering product out of the trunk of our cars and started seeing some strong sales as a result. And all of a sudden those same distributors were asking to carry our product. We used them for areas farther away but we didn't love the job that they did and we didn't like how they behaved as a company. So quickly, we decided that there was an opportunity to be a distributor as well. We decided that we could use the position as a distributor to influence the types of products that came into our marketplace and the types of products that got placed on grocery shelves.
What makes a distributor the right distributor for Hippie Snacks? What characteristics do you look for?
There are two things. One is on the values side. Values and sustainability are baked into who we are and what we are. You want to work with people who are aligned with that. Because it eventually shows up whether it's rearing its ugly head in a bad way or whether it glows and shines in a good way. It always comes through.
The second: You really want somebody that's going to give some love to your product; that's going to pay attention to it; that has time to focus on and gets what it's about and is able to tell its story. You want them to be an advocate for your product in the market. Most of the distributors out there are what I call "guys with trucks." They're third-party logistics. They're a place where stuff is stored and shipped—and that's it. That wasn't what we wanted to be. I don't like businesses that are in a race to the bottom. I'd rather provide a service or a product that is much different from what's out there. And I'd rather have a strategic competitive advantage that gives reason to believe in your product and in your service. That is super important.
Can you unpack what “better for you" food means?
That's a complicated one that means so many things to so many different people. I'll speak for how we look at it. When I started this business in 1996, let's be honest: We were kind of freaks. We were the weirdos who were pushing organic food. Sure there were some people that were into it, but it wasn't mainstream. So, at the start, a way to stand out was to do a natural product or an organic product— the same version of something else that's already out there but in organic or natural version.
As the categories have matured and organic has become more mainstream, and natural is a given in a lot of ways, that definition has evolved. It has been about bringing in things like nutrient density, short ingredient lists, minimal processing, how ingredients are sourced, how workers are treated. There are so many more of the triple-bottom-line velocities coming into it. We started to look at everything else involved. What kind of people are involved in this? Who were the companies? How do they treat people? How do they show up in their community? For us, it's a very encompassing thing. Not only is it food that's better for you nutritionally and from a chemical or additive perspective, but it's also about being a good company.
Left Coast Naturals has a mission of believing in the triple bottom line approach and a business philosophy that focuses on people, planet, and prosperity. Why did you adopt this approach? And how does that come to light in your company?
I came into this business as more of an environmentalist. I grew up in the outdoors. I'm still a big outdoors person. When you appreciate the outdoors, you definitely want to preserve that when you come into business. We came into this with the environmental approach. As I got into it more and understood organics, we started looking at the social impact and the people impact. I knew in running a business, it wasn't just about building it into something that I could flip later. Because that doesn't have legacy or have deep meaning. When I am ninety and reflecting on my life that is not going to put a smile on my face. What is going to put a smile on my face is having an impact and having built community. I knew that from a young age, partly because of being in the outdoors, partly because it's what I was raised with. How you treat people is paramount.
What has been your sustainability journey since 1996?
It started on the product side. We're going to do an organic or natural version of something where one didn't exist. We were bringing a better option to fold. It was about the ingredients that went into it, the packaging, and the energy sources. It was about those simple things that most people think about now. As we got into it and did a life cycle analysis, we started challenging ourselves to understand our areas of impact. We realized that so much more of the footprint that we were creating as a business was associated in a lot of other areas than expected. For example, if we look at the carbon footprint of a Hippie Snacks product, 55 percent comes from how the food is actually grown. So all those growing factors like tillage practice, irrigation methodology, water source, and riparian area protection contribute to the biggest piece of our carbon footprint. And then you start bringing in social factors like how the workers are treated, how they show up in their community, what kind of governance that company has, how do they help to move the dial within the industry by being advocates toward the right areas—and are they actually doing what they saying? As we got to know more companies and their practices, it started to shape us. As we dove into life cycle analysis, it really expanded us to where we are today, which is looking full circle in all aspects of our products. This led to a lot of decisions and changes that we put in place.
How important is packaging in the overall sustainability of a food product?
Welcome to the conundrum of a sustainable business. You can talk about the things that people understand and they scream for, or you can talk about the things that actually have an impact. One of the things that we've struggled with is that packaging is 2 percent of our footprint but it's the first thing that everyone raises concerns about. I do believe it's something we need to work on. But should we be working really hard on that 2 percent item where even if we improve it by 50 percent, we only gain a 1 percent gain in our footprint? Or should we work on the transportation of our ingredients and products, which is 25 percent? Or the food waste aspect? Those areas have a much larger impact.
The problem is that customers aren't asking for that. They don't understand it. They're confused by it. There's a lot of education that needs to happen. We have spent a lot of time trying to educate. And frankly, you get mixed results. Not everybody gets it. There are some reference tools out there. That's why we use certain certifications like B Corp, which is an easy one you can point to say that we're doing that. It's easy to understand. (A B Corporation is a sustainability and social certification that scores organizations on different areas like the environment, community, social impact, and how you operate as a business. It's very transparent.) But it is frustrating sometimes, as a sustainable business, that the things people want aren't always the things that actually move the dial.
And environmentally friendly practices can be costly. Have you experienced that at Left Coast Naturals?
For sure. They're costly and sometimes they're actually backwards. In other words, you think you're doing something good, but you're actually not. An example is that we did dig into packaging and we found some compostable packaging. One of the best options we found was a cellulose-based one, which is a wood fiber. Firstly, it ended up not being fully compostable. But second of all, when we dug deeper and actually asked the questions, we found out that the process to create that product had heavy industrial chemical input, and the impact from that was ten times worse than the packaging itself. So sometimes you just don't ask enough questions, and the deeper you dig, the more questions come up, and the more you realize that solution that seemed easy actually isn't easy. And unfortunately that's why a lot of people throw their hands in the air. So we're kind of the crazy ones that keep digging deeper and deeper and it leads us down a path of discovery.
From a consumer standpoint, it can be easy to find yourself stuck and wishing there was an easier way to understand the dynamics behind the impact of a product.
There are measurement tools coming where you can calculate carbon footprint on a product. They're forthcoming. But understanding it can be counterintuitive. For example, we source honey from Alberta, Canada, which is about an eight to ten hour drive from where we are. And we bring quinoa in from Bolivia and Peru. The footprint on the quinoa from Peru is actually way less than the honey that takes an eight-hour drive to get here. Because transporting by ship is fifty-two times more efficient on a carbon intensity than driving by truck. So just that one thing changes the complete dynamic.
The other thing we always consider is what I call the farmer's market approach. Isn't there value to the fact that if you can look a person in the face you can maybe trust their product a little bit more? So there is some aspect to that where sometimes it is better environmentally to buy local, sometimes it isn't. But there's also a social impact where you're putting money into your community. There are other values that come with that as well.
You have held a strong and rather controversial stance on genetically modified organisms. You have decided to cut GMOs from your supply chain. When did you make that decision and what impact has it had?
It was a pretty early decision. It really comes to the fact that you want food as close to nature as possible. So is it natural for a gene from a fish to be in a soybean? I don't call that natural. As a distributor, we don't control how other companies buy things but we can decide whether to buy that product or not. So we decided back closer to 2010 to become a non-GMO distributor. We assessed every brand that we had and worked with them to move them to non-GMO. We gave ourselves two years and then we drew a line in the sand. We gave up at least $500,000 in sales of products that we were no longer going to carry.
In business and in life, when you have a stance on something, that stance can mean one thing when it leads to profit. But when it sometimes leads to further costs or less profit, that's really where the rubber hits the road. If your business isn't just about profit, if it's about impact or it's about doing the right thing, that's the moment where you get tested on that.
Your internal company culture is very unique. Some of the benefits that you provide to your employees are incentives around bonuses for employees that buy organic food or ride a bike to work or make environmental improvements in their homes. How did you conceptualize these incentives?
This comes back to when we started doing life cycle analysis on our products and were looking at impact. But as you start wanting to expand or improve your impact, you realize there's a lot of other stakeholders- farmers, processors, distributors, retailers, consumers. So we asked: How can we help change things outside of our business? As we assessed we realized our employees were a fairly easy area where we could help make a difference. How can we help them make better choices in their life without telling them they have to do something? We're not dictatorial that way. We don't want to have a company where we tell people how to act. We just want to have a company that treats people well and that people are excited to be a part of.
When we thought of ways we could help our employees make some positive changes, this bonus program was one of them. We asked what's stopping the team from making positive changes in their life? Sometimes people will come up with reasons why not instead of reasons why. And sometimes that's money. So we decided to help people eat more organic foods. We did a bit of back-of-envelope calculation on what the difference would be to eat organic and it was about $75 a month. So they got $75 a month for that and $120 if they ride their bike to work, $40 bucks if they carpool. And we give them $200 every two years toward buying a bike. We also provide $400 toward making improvements in their home, so if they want to put in a more efficient water heater or solar panels. Really it was about giving them the ability to make some changes that they probably already wanted to make.
It's amazing to see the number of people that we've got onto organic because of this, or who started to ride their bikes to work. And they've found all these other things that come from that: Not only do they have the money in their pocket but they're feeling healthier, they're sick less, they're in a great mental state when they come to work. There are so many other factors.
What has been the feedback from your customers?
It has definitely been an evolution. In the early years, you know, you have your core natural food stores. They really understand you and appreciate it. Because sustainability and organic have become more mainstream, even the most conventional grocery stores want to talk about this because they know it's what their consumers want. We sometimes look at ourselves as a way for those stores to look good by brining them product with stories to tell. We get to do positive things for the world, and it helps build more business and it makes our customers happy.
We have a scorecard for any product that we distribute. We have a scorecard for the farms that we buy from, and we share those scorecards with the retailers, which tell of the standards that we look at. This creates built-in, baked-in integrity. When we pre-screen these products, the retailers appreciate that. A lot of the retailers are buying into this. In the Canadian market about five or six retail chains have become B Corps. They heard about what we're doing, they liked it, and jumped on. When our values are aligned around this, they get excited about it. It's a win-win.
Where do you see Left Coast Naturals in the next ten years?
From a business perspective we have two goals. Within the distribution business, it is to be the preeminent organic distributor in Canada. We want to have impact on the retailers and suppliers we work with. Every year we want to have an even better portfolio of products. So we raise the profile of our products in our sustainability score so when people look at us, they know they can trust that product.
On the Hippie Snacks side we feel that in the next ten years we can be the leader of functional snacks, or better-for-you snacks, by continuing to bring innovation and less-processed, natural, organic, non-GMO products that are made from real foods. We do promotions where if people buy three Avocado crisps they get a free avocado. Because if we're honest, I think I'd rather have people need avocados than our avocado crisp, because that's better for you. But if you can't do that, then we're convenient second option. A lot of this is being honest with who we are and trying to impact the stakeholders around. Going back to our core which is: good people providing good food.
——
At The Conscious Investor, it is our goal to shed light on topics that we find interesting, inspirational, and educational. Therefore, this article is strictly for inspirational and informational purposes only. It is in no way intended to substitute for professional investment advice, professional financial advice, or general counsel. To the extent that an article features the insight, opinions, or advice of an expert or company, the expressed views are those of the cited person or company and do not necessarily represent The Conscious Investor and its employees or affiliates.