Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2: Hello and welcome to another episode of the Odd Lots podcast.
Speaker 1: I'm Joe Wisenthal and I'm Tracy Alloway.
Speaker 2: Tracy, I think it's because of all of the illegal
Speaker 2: cannabis stores in New York City.
Speaker 1: But this could go anywhere. I know, all right, go on.
Speaker 2: But the thing about them, and I guess it's kind
Speaker 2: of funny, and I guess it kind of makes sense,
Speaker 2: and maybe it's also kind of cool, is that The
Speaker 2: other thing is like, so they sell various weed products,
Speaker 2: but they also seem to be the favored vendors of
Speaker 2: all kinds of exotic snack foods in New York City.
Speaker 1: Right, So if you go into a corner store in
Speaker 1: the window, yeah, yeah, exactly, you don't have to go in,
Speaker 1: you can just look. You will see weed probably a
Speaker 1: lot of these stores are still unlicensed. You will see
Speaker 1: energy drinks, you will see maybe some alf bars and
Speaker 1: things like that. Yeah, and then you will also see
Speaker 1: lots and lots of snacks. It's like the ultimate vice shop, right,
Speaker 1: like you can satisfy, you can satisfy all your cravings
Speaker 1: or almost all of them in one shop.
Speaker 2: Yes, absolutely, not only do. They have a lot of
Speaker 2: chips and snacks. They have the type of snacks that
Speaker 2: used to be you would get only when one of
Speaker 2: your colleagues like went abroad, right, So you'd have a
Speaker 2: colleague that like took a trip to the Philippines or
Speaker 2: took a trip to Hong Kong or something, and then
Speaker 2: they would come back and they're like, oh, look I
Speaker 2: brought like, you know, Macha flavored kid kats or mapo
Speaker 2: grilled tofu flavored potato chips, or diry and flavored potato chips.
Speaker 2: And then it never was there so cool. But now
Speaker 2: they're everywhere in the stores here.
Speaker 1: They definitely are more available than they used to be.
Speaker 1: My experience with this personally is probably a little different
Speaker 1: to a lot of other people, as someone who you know,
Speaker 1: spent a lot of you that in Japan. Yeah, I
Speaker 1: mean I have I have vivid memories of going into
Speaker 1: like a don Keyixote, which is this big kind of
Speaker 1: department store, specifically to buy flavored kit cats. They were
Speaker 1: always in the basement and there were like dozens of flavors.
Speaker 1: Even in this would have been in like two thousand
Speaker 1: and one, two thousand and two, and I feel like
Speaker 1: flavored Kitkats are to me probably what shrimp is to
Speaker 1: that character from Forrest Gum. Like I could sit here
Speaker 1: for the next twenty minutes and just like rattle off
Speaker 1: all the flavors that I remember. I love Kitkats.
Speaker 2: So in doing research for this episode, I came across
Speaker 2: this great website, takitos dot net, which basically refused every
Speaker 2: single snack and so right now they have links like
Speaker 2: and I don't know if all the links work, because
Speaker 2: I get the impression that some of these flavors are
Speaker 2: cycled in and out, but there are links and reviews
Speaker 2: of one hundred ninety seven different flavors of Dorito's that
Speaker 2: theoretically currently or at some point we're sold on Amazon,
Speaker 2: Dorito's blue Grilled Steak, Dorito's Golden Cheese Flavor, Dorito's late
Speaker 2: Night Tacos at Midnight, Dorito's three D crunched chili cheese Nacho,
Speaker 2: and then I mean it just the list just goes
Speaker 2: on and on. It is nothing like when I was
Speaker 2: a kid in the US, whereas like there was like
Speaker 2: Dorito's and cool Ranch Dorito's. Yeahs it, We're living in
Speaker 2: a golden age.
Speaker 1: So I disagree a little bit on this point. So, yes,
Speaker 1: there are lots more flavors that exist, but as you
Speaker 1: just pointed out, like they are not always available. And Okay,
Speaker 1: in New York, you know, you can go into a
Speaker 1: weed shop and there's a novelty value to buying like
Speaker 1: some exotic flavored potato chips alongside you know whatever else.
Speaker 1: But I feel like what this really kind of comes
Speaker 1: down to is this really really intelligent marketing strategy where
Speaker 1: you create all these new types of flavors and you
Speaker 1: get people talking about them, and maybe you don't produce
Speaker 1: them in huge quantities, but people like to talk about them.
Speaker 1: People like to you know, take pictures where they're eating
Speaker 1: Matcha flavored or like Soccer of flavored kit cats or whatever.
Speaker 1: So like for the companies, it feels like this is
Speaker 1: kind of a win win.
Speaker 2: Well I agree with that, and you do see this,
Speaker 2: like on Twitter, a lot of it's like, oh, Dorito's
Speaker 2: just teamed up with you know, Jack in the Box,
Speaker 2: or Dorito's just teamed up with so and so, and
Speaker 2: then there's like a short run thing. So I do
Speaker 2: get the impression some of them are by the way,
Speaker 2: I just can't he Dorito's gold picking Duck flavored. Oh
Speaker 2: that sounds so good, so good. A right, We're gonna
Speaker 2: have to try to anyway. But it does reason the
Speaker 2: question like how did this happen? I mean, it's great,
Speaker 2: I love it. I mean I don't need that many chip,
Speaker 2: but in theory I love it. How did we enter
Speaker 2: this world where we just have so much variety? And
Speaker 2: although a lot of them maybe are short run, like
Speaker 2: a lot of them do exist, you have to work
Speaker 2: a little bit. But while we're waiting, I did order
Speaker 2: like a twelve pack Dorito's pack and a sixteen pack
Speaker 2: different flavored kid Cat So they are gettable, you know,
Speaker 2: at various times.
Speaker 1: They are gettable. I still have questions about the overall
Speaker 1: distribution strategy here, but it does seem like there is
Speaker 1: this trend towards a much wider and more exotic variety
Speaker 1: of flavors, and so I'm curious how that came to be,
Speaker 1: Like what is the corporate strategy that's actually driving it?
Speaker 1: And also the technology? Right, so how can it be
Speaker 1: that a company like well, Kitkat's not a company. In fact,
Speaker 1: I think Kitkats are made by both Hershey's and Nestley,
Speaker 1: depending on what part of the world you're in. But
Speaker 1: how is it that they're able to do you know,
Speaker 1: dozens and dozens of different chocolate flavors and variations of.
Speaker 2: Oh my god, I check out this flavor Dorito's Roulette.
Speaker 2: Have you heard of this?
Speaker 1: This episode is just going to be us like looking
Speaker 1: at this is great.
Speaker 2: This is such a good idea. Dorito's Roulette originally came
Speaker 2: in a Nacher Cheese version, offering randomly placed hot chips
Speaker 2: among regular Nacher cheese works. That's such a good idea,
Speaker 2: like some excitement anyway. To me, this is a golden age,
Speaker 2: So I think we need to understand and the sort
Speaker 2: of infrastructure and science and technology that has created this
Speaker 2: era of chip abundant And I'm really chip abundance memorous
Speaker 2: snack food of us.
Speaker 1: This could be a different type of Loots episode.
Speaker 2: Put go on, Yeah, there's no shortage here. It's the
Speaker 2: lack of shortage that we're blown away by. We're going
Speaker 2: to be speaking with Ryan Harlan. He is the director
Speaker 2: of business Development at Etech Control Systems Integrator, and he
Speaker 2: works with the various food and snack companies that are
Speaker 2: rolling these out across the assembly lines. And he also
Speaker 2: works on distribution. So, Ryan, thank you so much for
Speaker 2: coming on the podcast.
Speaker 3: Thank you for having me.
Speaker 2: So I think we're a golden age. Tracy is a
Speaker 2: little skeptical. Where do you come down on this question.
Speaker 4: I think we're almost in a golden age. I think
Speaker 4: we're getting there. I think within a lot of these
Speaker 4: snack food companies. Doesn't quite think we're to the maximum capacity, right, We're.
Speaker 2: Still haven't reached out.
Speaker 1: The best is yet to come?
Speaker 2: Is yet to come?
Speaker 1: That sounds good. So maybe before we begin, can you
Speaker 1: explain what it is that you do in the snaw
Speaker 1: back food industry so to speak.
Speaker 3: Sure.
Speaker 4: So we work on the industrial automation side. So we're
Speaker 4: an engineering services firm and panel shop. So we build
Speaker 4: control panels that contain the programmable logic computers the PLCs
Speaker 4: that have the programming that tie all of the various
Speaker 4: machine centers within a line that create the snacks. So
Speaker 4: you'd have your buyers, dehydrators, fillers, cappers, baggers, palatizers, whatever
Speaker 4: you would have on the line for whatever type of
Speaker 4: snack you're producing. The control system has the program tells
Speaker 4: what to start, when, what to do which process, and
Speaker 4: then eventually at the end you get your product and
Speaker 4: then send it off to the warehouse where a different
Speaker 4: system picks it up.
Speaker 2: So I want to talk about the technology and how
Speaker 2: we got to this era, but first I want to
Speaker 2: actually establish the premise of the conversation. Is it true, though,
Speaker 2: regardless of whether we've reached the true Golden age or not,
Speaker 2: that we just have tremendous more variety of snacks than say,
Speaker 2: when I was a kid, and I think there were
Speaker 2: like two flavors of Dorito's.
Speaker 4: Yeah, no, that's absolutely true. And a lot of the
Speaker 4: snack production is local. So if you're buying Freedola chips,
Speaker 4: you're probably getting them from a factory within a couple
Speaker 4: hours from you for the most part. If you're in
Speaker 4: a large population center, and these factories have been around
Speaker 4: for fifty plus years in a lot of cases, and
Speaker 4: it's a local supply chain. So the change from two
Speaker 4: flavors to multiple flavors with a similar population typically in
Speaker 4: an area, is due to enhance production and throughput.
Speaker 1: On that note, when did this become a thing or
Speaker 1: start to become a thing and what was the proximate
Speaker 1: like trigger or development that kicked off. I mean, I
Speaker 1: imagine there was a company that was probably at the
Speaker 1: forefront of this, and maybe it was the maker of
Speaker 1: kit kats, or maybe it was a potato chip company
Speaker 1: or something like that, But what was it that kind
Speaker 1: of set this development in motion?
Speaker 4: I actually think these soda producers were on the front
Speaker 4: lines of this for doing single runs, so you could
Speaker 4: dozens of different mountain dew flavors going back twenty years right,
Speaker 4: and limited time offerings. And soda is really easy to
Speaker 4: do this with because you have your recipe, you clean
Speaker 4: out your pipe, everything is the same. It's a really
Speaker 4: simple industrial process and it's a lot more difficult when
Speaker 4: you're dealing with snack food comparatively.
Speaker 2: Before we even start talking about variety though, how is
Speaker 2: it chip made? Let's just go think about like a
Speaker 2: single bag of Fritos, I like Frito's, you know, just
Speaker 2: like when we think conceptually, like what is the process
Speaker 2: that existed probably forty years ago, twenty years ago, ten
Speaker 2: years ago in which we got free doos? What happens
Speaker 2: to make a frido?
Speaker 4: So if you look at the ingredients for a normal freedo,
Speaker 4: I think it's corn, corn oil, and salt. If you
Speaker 4: don't have any any other seasoning on it. So you're
Speaker 4: going to have your ground corn product, you're going to
Speaker 4: fry it. You could make a frito at home, right,
Speaker 4: you could deep fry some corn flour and oidy together
Speaker 4: into different shapes.
Speaker 3: I've may squeeze it into shapes and fry it.
Speaker 1: I have not made homemade fri doos, but maybe sorry.
Speaker 4: I don't think they would turn out quite the same.
Speaker 4: But it's very simple, right, So you're frying the corn
Speaker 4: and sending it through and that's really it. So that
Speaker 4: hasn't changed for the actual production of a free doo.
Speaker 4: You've had enhancements on the consistency of the shapes, the
Speaker 4: volume you can do it once, the timings for various fries,
Speaker 4: and how you might move it through. But the freedom
Speaker 4: of fifty years ago is looks a lot like how
Speaker 4: it's made today.
Speaker 1: So you're talking about the actual manufacturing process. But I
Speaker 1: mean that is like in some respects, that's kind of
Speaker 1: a later step in these snack food product cycles. And
Speaker 1: the very beginning is you know, I imagine there's a
Speaker 1: flavor lab somewhere at a large snack food company and
Speaker 1: you have all these people who are brainstorming ideas and
Speaker 1: then maybe there's research and development that goes into thinking
Speaker 1: about a specific one, there's consumer testing, product testing, seeing
Speaker 1: how people respond to it. It feels to me like
Speaker 1: maybe one one of the big changes that has happened
Speaker 1: is that people have like also figured out that, well,
Speaker 1: you can cut down a little bit on this huge
Speaker 1: R and D process just by producing a bunch of
Speaker 1: different flavors. So it's not like it's not incredibly important
Speaker 1: to your company if you unveil this new flavor and
Speaker 1: it falls flat, so to speak, if you're unveiling a
Speaker 1: new flavor every other.
Speaker 4: Month, right, And I think what they've gotten very good
Speaker 4: at is so they would have small scale versions of
Speaker 4: their factory or digital versions even now, where you would
Speaker 4: produce something called the digital twin of your factory line
Speaker 4: and you can simulate the R and D process through
Speaker 4: there for the actual production and then push everything through
Speaker 4: digitally to the factory so you can say, we know
Speaker 4: it's going to take this long to cook, we want
Speaker 4: to add this much flavor, we want to add this
Speaker 4: much salt, garlic powder, chili powder, whatever you're going to
Speaker 4: add to it, sugar, and we can test all that digitally.
Speaker 4: We know how it's going to flow through the line
Speaker 4: and then send that recipe directly to the production factory
Speaker 4: to send it through a test run there. And doing
Speaker 4: that process I think has sped that up a lot.
Speaker 4: And they're using ingredients they already have, right, it's just
Speaker 4: a different ratio. They're not affecting their own supply chain
Speaker 4: as much as they're affecting their potential total throughput when
Speaker 4: they make these runs. Because you do have change over time,
Speaker 4: you do have recipe management, traceability concerns that you have
Speaker 4: to do for various potential recalls and things like that.
Speaker 4: So there's an opportunity cost, but it's pretty limited if
Speaker 4: you feel confident you can get this run in Oh.
Speaker 1: That's really interesting. So you can come up with a flavor,
Speaker 1: and then using digital technology, you can basically simulate what
Speaker 1: the production would look like using your existing system or
Speaker 1: maybe figuring out if you need to put anything new
Speaker 1: in place, although it sounds like for the most part
Speaker 1: they don't.
Speaker 4: Yeah, I think the real benefit for being able to
Speaker 4: put something new in place is say you wanted to
Speaker 4: change the bag sizes and you wanted to look at
Speaker 4: maybe we have a line that goes through normally, but
Speaker 4: now it feeds into a one ounce, two and a
Speaker 4: half ounce, and six ounce bag potentially with quicker change
Speaker 4: over time, so that you can have more variety running
Speaker 4: through a line. You could basically drag and drop the
Speaker 4: designs from an OEM into your line and it runs
Speaker 4: sort of. I don't know if you guys are familiar
Speaker 4: with the Factorio game. It's a big game for engineers.
Speaker 1: No, that's so amazing.
Speaker 3: It's really good.
Speaker 4: It's a it's a computer game that lets you build
Speaker 4: a simulated factory with physics and everything. Oh wow, and
Speaker 4: eventually your factory covers the whole planet. And it's still
Speaker 4: a video game, but it's it's really it's really interesting
Speaker 4: that way. And we're doing that in real life now,
Speaker 4: where we can drag and drop different elements into the
Speaker 4: factory and potentially move pieces from other production lines to
Speaker 4: two different lines.
Speaker 3: For what we're trying to do. That really speeds up
Speaker 3: the R and D process.
Speaker 2: So let's talk about the increased throughput or the speed
Speaker 2: with which changeovers can happen, et cetera. So let's imagine
Speaker 2: it's two thousand and four and someone at Dorito says,
Speaker 2: you know what, I think that the consumer would like
Speaker 2: a shrimp flavored dorito, and maybe they've done some testing
Speaker 2: and some surveys and something like there seems to be
Speaker 2: some appetite for a shrimp flavored dorito, et cetera. How
Speaker 2: difficult is that changeover in two thousand and four to
Speaker 2: get the line to pause and go from regular doritos
Speaker 2: to shrimp flavored doritos versus the difficult and ease of
Speaker 2: that technology or that changeover in twenty twenty four.
Speaker 4: In two thousand and four, you're dealing with paper in
Speaker 4: a lot of that part of the factory. So you're getting,
Speaker 4: if you're an operator, you're getting a recipe on paper
Speaker 4: to go grab a twenty pound bag of salt, Go
Speaker 4: grab a forty pound bag of this, Go go do this.
Speaker 4: And there's a lot more checking, rechecking mistakes, quality issues.
Speaker 4: There isn't the digital feedback that you have now with
Speaker 4: the sensors down the line to check for quality. So
Speaker 4: now we have three dvision systems that can dimensionally check
Speaker 4: a chip. Is it big enough, is it unbroken? Check
Speaker 4: it for color? Does it look like it got enough seasoning?
Speaker 4: Did it overcook? Is it a little too brown? Did
Speaker 4: we send it through the fry or too long? Is
Speaker 4: it undercooked? Are we getting a bunch of chips that
Speaker 4: are stuck together? There's some issue on the front end
Speaker 4: that things aren't working right after we made the changes.
Speaker 4: So all that can be detected in process now and
Speaker 4: things can be stopped a lot faster and corrected. Where
Speaker 4: twenty years ago, you're pulling something off the line, someone
Speaker 4: is standing there analyzing all the lines running, and you
Speaker 4: could be producing thirty minutes of bad product before you
Speaker 4: catch it right, the potential for mistakes was a lot
Speaker 4: higher and the risk of lost revenue was significantly higher.
Speaker 2: Yeah, I wanted to get into the talking changeovers. Can
Speaker 2: you talk then a little bit about okay, the sort
Speaker 2: of business side of these decisions. So, if you can
Speaker 2: catch mistakes faster, if you can make sure that the
Speaker 2: seasoning is applied consistently quicker on a new run, what
Speaker 2: opportunities does that open up for the OEM or the
Speaker 2: company in terms of like, okay, now the bar to
Speaker 2: make a decision. It's easier, we can try new things.
Speaker 2: Talk about the connection between that technology and then the
Speaker 2: confidence that a company has in trying new things.
Speaker 4: Yeah, So when we're talking about how an operations person
Speaker 4: or a plant manager would look at their production facility.
Speaker 4: There's sort of a triangle between throughput, up time and quality,
Speaker 4: and they're weighing these three factors against each other for
Speaker 4: how they're producing to get up the number. It's a trilemma, right,
Speaker 4: because you can never be better than your worst metric really, right,
Speaker 4: So no matter how much you produce, if only fifty
Speaker 4: percent is good product, you've only fifty percent effective, right.
Speaker 1: Saving that for my next performance review.
Speaker 4: Yeah, but it's it's like that in production. So what
Speaker 4: we're looking at really is the loss of uptime guaranteed
Speaker 4: when you are making changeovers. So you know you're going
Speaker 4: to have planned down time as you do these changeovers,
Speaker 4: so you have to outperform on your quality and throughput
Speaker 4: side as this goes.
Speaker 3: So, part of.
Speaker 4: The digital transformation that you see in factories and the
Speaker 4: digitization of factories is that you can pull a lot
Speaker 4: more elements out of all of your various devices. In
Speaker 4: two thousand and four, to use that example, if something
Speaker 4: failed in one machine center in the factory, if you
Speaker 4: were having an undercooking problem, you might not be able
Speaker 4: to correct it unless someone got into the program made
Speaker 4: some changes and then adjusted the time or an operator
Speaker 4: caught it. And if you were two am and it's
Speaker 4: the third shift, that operator might not be paying attention.
Speaker 4: It might be their second job. They just have probably
Speaker 4: not worked there that long usually, and the programmers also
Speaker 4: worked during the day, so they might not be able
Speaker 4: to fix it until the daytime. And now, because of
Speaker 4: the digital feedback, we can create a sort of machine
Speaker 4: learning environment potentially, or at least a closed loop environment
Speaker 4: where we can use the quality data from three division
Speaker 4: cameras later on in the system, or any camera system
Speaker 4: we're using, and feed that back to the earlier machine
Speaker 4: centers to say we're undercooking. Go longer, make that change,
Speaker 4: and I'll validate as this next batch of product comes through. Right,
Speaker 4: because it's usually a continuous process, so as I start
Speaker 4: seeing good chips, I'll tell you that we're fine. And
Speaker 4: it operates a little like cruise control in your car. Right,
Speaker 4: So you've got a loop system. You want to go
Speaker 4: fifty five, you're going fifty seven, you slow down, you
Speaker 4: speed up until you get to a more ideal product,
Speaker 4: which in the past, a really good operator does that
Speaker 4: on their own. But truly post pandemic, we're at a
Speaker 4: loss of good operators, and we're at a loss of
Speaker 4: people that want to be operators in the first place.
Speaker 1: As you're going through all these new technologies, I'm sort
Speaker 1: of like mouthing to Joe, going wow, Yeah, for each
Speaker 1: of these, I'm coming round to the golden age of
Speaker 1: snack food idea, at least in terms of the actual
Speaker 1: manufacturing process. But one thing I wanted to ask is, Okay,
Speaker 1: so you described how new technology can kind of be
Speaker 1: used as a safety net almost for risk taking and
Speaker 1: punting on new types of flavors and makes it easier
Speaker 1: in many ways to create these things. Is there a
Speaker 1: way that technology can also inform the flavors being made? Like,
Speaker 1: for instance, would you get data from a digital assistant
Speaker 1: on the factory floor which would say, like, Okay, you're
Speaker 1: not using up all I don't know, like the cheese
Speaker 1: or the garlic when you're doing this particular product. Maybe
Speaker 1: you want to look into doing a more cheese and
Speaker 1: garlic heavy version of this. Do you get that kind
Speaker 1: of feedback to.
Speaker 4: Yeah, that kind of feedback can absolutely be flowed upward
Speaker 4: towards the business process as we're collecting all this data,
Speaker 4: So that tends to get visualized in dashboards for business
Speaker 4: operations to look at and see what they're doing. That
Speaker 4: wouldn't be an automatic decision, but absolutely we could see
Speaker 4: that we might be able to produce different product because
Speaker 4: we have a glut of some supply with how something
Speaker 4: is working or how that goes. I think what informs
Speaker 4: production more ends up being what leaves through the supply chain.
Speaker 4: On the logistic side, what goes out of the warehouse,
Speaker 4: what starts being ordered more, And that now can be
Speaker 4: a driver versus I think in the past you would
Speaker 4: have kind of a monthly production run planned out in advance,
Speaker 4: and now I think it's much more day to day.
Speaker 4: Someone comes in and finds out what they're producing that day.
Speaker 2: So we've been talking largely in the chip idiom so far,
Speaker 2: so to speak. But another snack category that is like
Speaker 2: really blown up, and I know that you've worked in
Speaker 2: this is nuts and particularly almonds and just the numerous
Speaker 2: flavors of packaged almends. You could get, like I think
Speaker 2: it used to be okay, you could get raw almonds,
Speaker 2: maybe in a bag and maybe toasted almonds, and like
Speaker 2: if you went to like you know, a hippie story,
Speaker 2: you could maybe get like tomorrow or like soy sauce
Speaker 2: almonds or something like that. But now there's just like
Speaker 2: so many they've just really gone wild with the almond flavors.
Speaker 2: What was that thing you were looking at, Tracy, Like,
Speaker 2: what was the.
Speaker 1: Oh, there's a brand of Korean almonds. I think it's
Speaker 1: called Tom's or something like that, and I am slightly
Speaker 1: upset with them. They come in all sorts of flavors
Speaker 1: like tirami, sou honey, there's savory, spicy ones as well.
Speaker 1: Whenever I see them at any store, mostly Asian supermarkets,
Speaker 1: I buy, like, you know, at least five packs. They're
Speaker 1: so good.
Speaker 2: So talk to us what you've seen in the nut space,
Speaker 2: the almonds space.
Speaker 4: Yeah, California obviously well known for almonds, as everyone heard
Speaker 4: about during the drought. That's right, So out here in
Speaker 4: the Central Valley we produce a lot of almonds, and
Speaker 4: the production factories that handle nut production out here not
Speaker 4: just almonds, but pistachios as well. When you talk about
Speaker 4: like the Wonderful Company, but when we're talking about almonds,
Speaker 4: it's typically you're going to hear Blue Diamond Growers is
Speaker 4: a co op of growers that own several factories through
Speaker 4: the area, and typically what they had done is just
Speaker 4: produced almonds and sent them off large amounts to Asia,
Speaker 4: large amounts to everywhere else in the world. Because something
Speaker 4: like ninety nine percent of almonds are grown in California,
Speaker 4: So if you've seen almonds somewhere, they were probably grown
Speaker 4: by a few of these large farms and sent off.
Speaker 3: And in twenty twenty, during the.
Speaker 4: Pandemic, obviously Asian markets straight up, as China shut down,
Speaker 4: a lot of the service industry that they might have
Speaker 4: sold to slowed down, and they made a business transition
Speaker 4: into snacks really out of necessity at first, and then
Speaker 4: it took off because people like yogurt covered almonds, and
Speaker 4: they like lightly salted, smoked almonds, they like spicy almonds.
Speaker 4: I think if there's a whole wall at the airport now,
Speaker 4: if you go in to see all of these flavors.
Speaker 2: Wh Yeah.
Speaker 1: Absolutely, it was a massive mistake to record this episode
Speaker 1: right at lunchtime. Can I just say that?
Speaker 2: So on Amazon you can buy a pack that has Smokehouse.
Speaker 2: This is just the Blue Diamond variety pack Smokehouse Bold,
Speaker 2: which is with sabi and soy sauce, hob and narow barbecue, shiraja,
Speaker 2: sweet tied chili, salt and vinegar, blueberry. It sounds a
Speaker 2: little weird. I'm not gonna lie whole natural, lightly salted
Speaker 2: and then toasted coconut and maybe, So how did this happen?
Speaker 2: How is a company that specialized just in like we're
Speaker 2: gonna sell balk almonds then able to whip out like
Speaker 2: eleven different flavors like this.
Speaker 4: They made the production choice to build new facilities and
Speaker 4: new lines solely for snack production during this time. The
Speaker 4: almonds don't stop growing. You have to harvest them, so
Speaker 4: when you're dealing with growers, they have the product. So
Speaker 4: they were essentially able to vertically integrate themselves into becoming
Speaker 4: a snack producer. And once you've decided you're going to
Speaker 4: make these little snack packs and you can make a
Speaker 4: one ounce or a two ounce or six ounce bag
Speaker 4: of almonds, you have your various lines and they're all
Speaker 4: producing different sizes, and then all you're doing is roasting
Speaker 4: your almonds and flavoring them and then cleaning that out
Speaker 4: and changing it over and doing a different flavor. So
Speaker 4: you could run lightly salted, and then you could run
Speaker 4: regularly salted without a real issue there, right, and then
Speaker 4: you could run maybe one more flavor after that before
Speaker 4: having to mess with things before you damage the flavor right.
Speaker 2: When you touch it. You mentioned, of course you have
Speaker 2: to clean out the flavor because you don't want the
Speaker 2: blue but you know you don't want to do the
Speaker 2: blueberry run and then the shir rocher run right after
Speaker 2: and there's still they're still residue from the blueberry run.
Speaker 2: Has that process changed, the sort of switchover process of
Speaker 2: getting one flavor in and one flavor out since you
Speaker 2: started in the industry.
Speaker 4: Absolutely it has, depending on what your product is and
Speaker 4: what your your pipes look like. You're sending steam through
Speaker 4: essentially doing what's called the clean in place process, so
Speaker 4: you're sending your cleaning fluid or steam through the pipe,
Speaker 4: and then you're changing out your nozzles and making sure
Speaker 4: that clean, clean equipment is in there. Everything is stainless steel,
Speaker 4: it's food grade, might get sprayed down, washed down. But
Speaker 4: what we've been able to do now is detect a
Speaker 4: cleanliness within the pipe that instead of running on timing,
Speaker 4: we can say we know the pipe is clean when
Speaker 4: we see these certain parameters go through or we can
Speaker 4: we can understand that this sensor as it comes through,
Speaker 4: it's it's now clean, and that's allowed gains of you know, somewhere.
Speaker 4: If it was a thirty minute process, maybe you've been
Speaker 4: able to gain four or five minutes. But if you
Speaker 4: want to do that three or four times a day,
Speaker 4: you've gained a lot of production because you're doing maybe
Speaker 4: two hundred bags a minute, right, So when you math
Speaker 4: that out, you're able to take these small We sort
Speaker 4: of described it as the power of gaining one percent.
Speaker 4: You gained one percent in twelve different places. You've gained
Speaker 4: the ability to produce a whole other product for an hour.
Speaker 3: Wow, you know, potentially.
Speaker 1: So Joe brought up the Korean almonds, and of course
Speaker 1: we started this episode mentioning kit kats among other things.
Speaker 1: But it does seem like Asia, in some respects has
Speaker 1: had a head start on experimenting with lots of different
Speaker 1: types of flavors. Can you maybe talk about what enabled
Speaker 1: them to do that? You know, places like Japan and Korea,
Speaker 1: how are they manufacturing all these different varieties And is
Speaker 1: it a case that we're sort of catching up to
Speaker 1: that technology or is it a case that the market
Speaker 1: was just more amenable to experimenting with these types of varieties.
Speaker 3: I'd say it's a mix of both.
Speaker 4: I think the factories when you're looking at production in
Speaker 4: Asia tend to be newer, where the production in America
Speaker 4: is retrofitted older factories from some of these legacy companies
Speaker 4: that a lot of these factories have changed hands. There's
Speaker 4: an ice cream plant down here that I think has
Speaker 4: changed hands like six different times and makes Hagendaws bars,
Speaker 4: but it's been owned by a bunch of different companies
Speaker 4: and it's been around for fifty years. And you didn't
Speaker 4: see that in the Asian markets. And I think that
Speaker 4: when they came in there with American flavors to produce
Speaker 4: for Asian markets, they didn't sell in the same way
Speaker 4: that they wanted them to. So they started experimenting locally
Speaker 4: by necessity to try and move product. I always think
Speaker 4: of it similarly to Procter and Gamble makeing spicier toothpaste
Speaker 4: for India, right, So they adjust to the local flavor.
Speaker 4: And I think some of that's market research and some
Speaker 4: of that's just sales data that they didn't perform, so
Speaker 4: they had the other flavors, and I think it took
Speaker 4: a long time for them to understand that America doesn't
Speaker 4: just want to eat barbecue chips right, that we'd love
Speaker 4: to get. I remember being very excited when I got
Speaker 4: my first Lais all dressed bag of chips that I
Speaker 4: found in the store, because I had seen online that
Speaker 4: they were big in Canada. And I don't know why
Speaker 4: that was exciting that I had the that's legitimately exciting.
Speaker 1: I'm excited for you.
Speaker 3: And they were good.
Speaker 4: I mean I never bought them again, but they were good.
Speaker 4: And I think a lot of people have that experience
Speaker 4: where they want a snack variety, but they want it
Speaker 4: to taste good. And I think that's the fear, is
Speaker 4: that variety will sell, but the flavor won't get another sale.
Speaker 4: And I think we've proven that sort of wrong, that
Speaker 4: we can always just create more flavors.
Speaker 1: Right, This is exactly what I was going to ask next.
Speaker 1: So you mentioned you never bought that particular thing ever. Again,
Speaker 1: it does seem like there is a consumption pattern here
Speaker 1: where a lot of it is all about the novelty value.
Speaker 1: So you know, a new flavor comes out, you try it,
Speaker 1: you either like it or you don't. But even if
Speaker 1: you like it. How much repeat business are these types
Speaker 1: of experimental flavors actually getting. It feels like it's very
Speaker 1: much about the cycle of launching new products.
Speaker 4: Yeah, it's definitely about the cycle of launching new products.
Speaker 4: And we've seen over the years that certain types of
Speaker 4: flavors have tended to hold up. Like a chili lime
Speaker 4: flavors on a lot of different chips have showed up
Speaker 4: and stayed flaming hot varieties of every chip have stayed.
Speaker 4: So it seems with spicier flavors they tend to stay.
Speaker 4: A lot of the novelty dessert flavors I don't think
Speaker 4: do very well that kind of bounce in and out.
Speaker 4: You know, cinnamon churro chips sound great and then they're fine.
Speaker 4: So I think if you trend it, if you walked
Speaker 4: into your store and took a picture of your chip
Speaker 4: aisle every week for a year, you'd see a lot
Speaker 4: of different flavors, and you'd see some new flavors never leave,
Speaker 4: and that those kind of get added into the production rotation.
Speaker 4: And that's all built into the business analytics from these
Speaker 4: companies that they can see their selling they move off
Speaker 4: the warehouse shelves, you know, they have to move these
Speaker 4: chips within a certain amount of time for freshness reasons.
Speaker 4: If they're not leaving the shelves, they don't get made again.
Speaker 2: This might be a really stupid question, but obviously in
Speaker 2: the era of Instagram and DTC companies. You know, we
Speaker 2: know about freedom Lay and these big companies, but there's
Speaker 2: obviously a million smaller brands that try to maybe they
Speaker 2: try to pretend to be a little bit healthier or
Speaker 2: maybe you know, whatever it is. Is it easy now,
Speaker 2: Like if Tracy and I had an idea for a
Speaker 2: chip shape and a chip flavor, is there sort of
Speaker 2: like off the rack infrastructure and capacity for us to
Speaker 2: just sort of buy some time and space on a
Speaker 2: line and sort of without having to do any infrastructure
Speaker 2: investment ourselves, like have a chip brand.
Speaker 3: Yeah? There.
Speaker 4: So we call these companies coe packers, the same way
Speaker 4: you would use for for beverage producers. And there was
Speaker 4: a fun example I ran into the other day of
Speaker 4: a company like this deciding they wanted to make a
Speaker 4: pea protein mix of a cheeto. Right, the company had
Speaker 4: this idea, this manufacturer built it and lo and behold,
Speaker 4: Now you can buy pedos at costco. So they sold
Speaker 4: this to Costco, had this idea, found this company to
Speaker 4: make it, and the production facility was there for them.
Speaker 1: So I'm sorry, I'm losing it a little bit at Sorry.
Speaker 3: I know that's I wanted to bring it up because
Speaker 3: I love the name. I thought it was so clever.
Speaker 1: I would try to think, where did go next? Okay,
Speaker 1: you've given pta? Sorry, what's the next big thing in
Speaker 1: snack food manufacturer? Sorry? I'm so sorry, that's a serious question.
Speaker 1: What Okay, So you walked us through all the technological
Speaker 1: enhancements that have enabled us to develop these new types
Speaker 1: of flavors and manufacture them in a more efficient and
Speaker 1: faster way. You know, things like sensors detecting cleanliness, the
Speaker 1: ability to observe the chips that you are producing for
Speaker 1: quality in a sort of automated way. What's next? What's
Speaker 1: really exciting in terms of that technology.
Speaker 4: I think the thing that's moving the technology along now
Speaker 4: is the movement of robotics into the production process in
Speaker 4: as many many places as we can get it. So
Speaker 4: where I'm starting to see it is so you would
Speaker 4: now see robotic arms and most manufacturing facilities at the
Speaker 4: end doing the palatizing process. So taking the finished boxes,
Speaker 4: it's a big robot arm picks them up, puts them
Speaker 4: on a pallette, arranges the palette, and then sends it
Speaker 4: off to the forklifts or automated guided vehicle back to
Speaker 4: the warehouse. Right, and then we're starting to move where
Speaker 4: now we're even using robots to start picking packs of
Speaker 4: things or stacking different parts of the process to get them,
Speaker 4: you know, stacked ten rice cakes and get them in
Speaker 4: a line so they can get wrapped and move to
Speaker 4: the process. So when you start to think of the
Speaker 4: technological innovation in a production line, you want to work backwards.
Speaker 4: So you can start at the warehouse because you'll never
Speaker 4: have a problem where you've created a bottleneck because you're
Speaker 4: already at the end. Then you can move to the
Speaker 4: palatizing process because in the wrapping process, because that's also
Speaker 4: the end. Now we're starting to move further and further
Speaker 4: through the production line, and we're having robots that move
Speaker 4: alarmingly fast as you stand next to them, that are
Speaker 4: doing a lot of these processes that maybe weren't done
Speaker 4: by hand. But we're done with a series of blocks
Speaker 4: and conveyors where a line would make the product turn
Speaker 4: three times and then it would get it into the
Speaker 4: right position to get into a bag and get everything moving.
Speaker 4: And the speed that we're creating on the back end
Speaker 4: has driven a lot of the speed demand on the
Speaker 4: front end now because we've got more production capabilities and
Speaker 4: we are ready to move.
Speaker 3: And when I think.
Speaker 4: About the future, it's just going to be more of
Speaker 4: this variety. I think that the food manufacturers have looked
Speaker 4: at things like ozembic as a challenge and the way
Speaker 4: that they're going to tackle it us through novelty. Right,
Speaker 4: Nesley just came out and talked about that we are
Speaker 4: going to innovate.
Speaker 3: And I don't know how.
Speaker 2: Oh zempig is going to kill our demand for snack food,
Speaker 2: but the way they're going to spond is by just
Speaker 2: such chantalizing, incredible creative flavors that it will overwhelm the
Speaker 2: medicinal suppression of our appetites. I'm excited for this cat
Speaker 2: and most battle of whether they could just shear innovate
Speaker 2: their way back to consumer demand.
Speaker 3: It's worked for me so far.
Speaker 1: I'm just thinking this is such a thematic all thoughts
Speaker 1: episode because we talked about palettes chips, although a different
Speaker 1: kind of chip and then we're also talking about ozembic
Speaker 1: and automation processes. But Ryan, you alluded to this earlier.
Speaker 1: But what is the labor picture like right now for
Speaker 1: snack food manufacturing? And one of the reasons I ask
Speaker 1: is I don't think my husband will mind me mentioning this,
Speaker 1: but one of his after school jobs in the UK
Speaker 1: was packaging chips and he said it was the most
Speaker 1: boring job and tedious job that he's ever done. And
Speaker 1: I think he did that for quite a while and
Speaker 1: just spent hours and hours putting like bags of chips together.
Speaker 1: But what is the labor picture like right now? How
Speaker 1: easy is it to find workers for this type of job.
Speaker 4: It's very difficult to find workers that want to staff
Speaker 4: these facilities. It's a boring job and it's a stressful job.
Speaker 4: Sometimes you know things are going down, you're getting hollered at,
Speaker 4: you're holding up production depending on what you're doing, and
Speaker 4: you may not know enough about the process, especially now
Speaker 4: where the machines have gotten so difficult. It's not a
Speaker 4: push button anymore. It's a iPad or it's a touch
Speaker 4: screen that you have on the line that is controlling
Speaker 4: things and you might need to click through several screens
Speaker 4: and make adjustments or start or stop something to cycle
Speaker 4: things to get everything back running. To go back to
Speaker 4: our two thousand and four example, what you might have
Speaker 4: seen in the past is staff at every single machine center.
Speaker 4: So you would have someone at the fryer, you would
Speaker 4: have someone at the bagger, at the palatizing station, someone
Speaker 4: might be putting chips in a box like you mentioned Tracy.
Speaker 4: And now what we're seeing is we can probably have
Speaker 4: an operator controlling two to three lines potentially on an iPad,
Speaker 4: walking around making sure that nothing's breaking, looking at and
Speaker 4: acknowledging alarms on their system. And when we talk about
Speaker 4: things like robotics in the palatizing station, so typically you're
Speaker 4: going to use two to three people per shift to
Speaker 4: do palatizing. If you don't have a robot there, someone's
Speaker 4: stacking boxes or you've got a machine and what you're doing.
Speaker 4: So one robotic arm eliminates somewhere between six and nine
Speaker 4: jobs for a three shift factory per line. So these
Speaker 4: products and these processes are removing operators. But out of this,
Speaker 4: really these jobs are very difficult to hire for and
Speaker 4: are always at a staff shortage. Every factor I walk
Speaker 4: into as a hiring sign. We can interview today, you know.
Speaker 2: So speaking of robotics, you know, one of the things
Speaker 2: that i've sort of actually there was an interview with
Speaker 2: Jensen Wong, the CEO of in video about this and
Speaker 2: I've heard this from else is that the power of
Speaker 2: robots will really be amplified with AI and I imagine
Speaker 2: and the idea is right like that if you have
Speaker 2: some sort of robotic arm picking up a bag, it
Speaker 2: helps if there it has like the bag is at
Speaker 2: maybe like a forty five degree angle that it can't
Speaker 2: just like it has to like shift a little differently
Speaker 2: or something like that. Can you talk a little bit
Speaker 2: about that more like how AI or maybe machine learning
Speaker 2: sort of makes it so that robots are becoming more efficient.
Speaker 2: Is that something you see so that they can respond
Speaker 2: to deviations or a weird chip shape comes through and
Speaker 2: it doesn't automatically, you know, it's still able to pick
Speaker 2: it up. Can you talk a little bit about this
Speaker 2: sort of intersection of AI and robotics and whether you
Speaker 2: see that as a force amplifier.
Speaker 4: Machine learning certainly when we're talking about it is already
Speaker 4: being used and you'd be surprised how often a very
Speaker 4: slight tilt in something will disrupt a robot entirely. So
Speaker 4: that does make sense. It's looking for a very specific shape.
Speaker 4: Sometimes you have to really build the process out in
Speaker 4: front of it.
Speaker 2: Because this is what I've heard from someone recent This
Speaker 2: is what I heard from someone recently about why we
Speaker 2: still don't have, for example, like robotic like pizzerias, which
Speaker 2: is just that they're still at the point where like
Speaker 2: if there's like if one of the pies is like
Speaker 2: a little bit smaller or a little bit bigger, et cetera, like,
Speaker 2: the robots still aren't nimble enough or agile enough that
Speaker 2: they would be able to respond, and then that would
Speaker 2: break the whole process. And so the argument is, well,
Speaker 2: if you have some sort of AI sensor vision and
Speaker 2: stuff like that, then in theory it can respond to
Speaker 2: these deviations faster.
Speaker 4: Yeah, right now, where we are at with robots is
Speaker 4: that you'll see when they start to make deviations. Sometimes
Speaker 4: they can respond for the first few issues, but they
Speaker 4: have trouble coming back to a home position to reset
Speaker 4: when the product is good again. So they can sometimes
Speaker 4: function for up to an hour in a sort of
Speaker 4: failing state, and then they fail entirely. And then the
Speaker 4: process has to be they have to be put back
Speaker 4: onto where they are in the grid and relearn where
Speaker 4: they are, and then you can fire it back up.
Speaker 4: So with robotics, we still have a lot of limitations there,
Speaker 4: and I think those limitations don't have to exist, But
Speaker 4: for the mass produced robots that we're using right now
Speaker 4: in production facilities, we still have those limitations. So I
Speaker 4: don't think Jensen is wrong that we could start using
Speaker 4: AI in these processes, and I think.
Speaker 3: Robotics is probably the first place to look when we
Speaker 3: talk about machine learning.
Speaker 4: We're using that all the time, where we're a closed
Speaker 4: loop process that the machine can determine. Dairies are especially
Speaker 4: good applications for it. Cheesemaking, where you're heating the product
Speaker 4: and moving it through. You're able to adjust times depending
Speaker 4: on variations of the product, and you can visualize what
Speaker 4: an ideal product would look like and know that and
Speaker 4: make make adjustments. With all the different sensing units you have,
Speaker 4: You're like, I need this, I need this moisture content,
Speaker 4: I need this temperature.
Speaker 3: I need it to get to at least this.
Speaker 4: It needs to be this color, but it's not this
Speaker 4: continue like all that's happening, but we are not to
Speaker 4: a point where we're letting anything sort of make decisions
Speaker 4: on its own.
Speaker 2: By the way, there are a bunch more blue diamond
Speaker 2: almonds than I said before, So anyway, there's various chocolate
Speaker 2: covered ones too. All Right, I have one last question.
Speaker 2: One thing we haven't talked about is the distribution side,
Speaker 2: because I have to imagine that, Like, Okay, it's great
Speaker 2: if the manufacturer can quickly change over their lines and
Speaker 2: reduce not have to worry about downtime as much when
Speaker 2: they're shifting from one stable process to another, But then
Speaker 2: you have this explosion of skews, and I have to
Speaker 2: imagine that makes a warehouse you know you have before
Speaker 2: you might have had a warehouse that had two kinds
Speaker 2: of freidos, and now you have a warehouse or probably
Speaker 2: you know, one hundred kinds. What is required on the
Speaker 2: sort of distribution side to handle the explosion of variety
Speaker 2: of snack food.
Speaker 4: Yeah, so we're seeing the rise of fully automated warehousing.
Speaker 4: And essentially what a fully automated warehouse looks like when
Speaker 4: you're dealing with Pallette sized product is you're going to
Speaker 4: have a series of conveyors and you're going to build
Speaker 4: it up in a multi story elevator situation, and you'll
Speaker 4: have carts that are not operating dissimilarly to what you
Speaker 4: would have in an Amazon warehouse where they're picking and
Speaker 4: placing something and going, but they're taking small tots right
Speaker 4: and we're dealing with palettes, so we're almost running it
Speaker 4: like trains and elevators, moving to certain locations that are
Speaker 4: then visible on a three D grid for the warehouse operator.
Speaker 4: So it's typically we can have one or two people
Speaker 4: operating this warehouse now and calling down for the packages
Speaker 4: they need in an automated way, so saying, we're going
Speaker 4: to fill this truck with these pallets in this order
Speaker 4: so that when we get to the various stops that's
Speaker 4: going to make it unloads in the proper order, and
Speaker 4: all these different pallets are located in beIN one point
Speaker 4: fourteen on floor five of our system and pulling through
Speaker 4: where in the past at right now. In a sort
Speaker 4: of a traditional warehouse, you'll have a sticker on the
Speaker 4: outside of a palette and someone drives up with a
Speaker 4: forklift and scans it and then pulls it in based
Speaker 4: on what order they're pulling something from and it's a
Speaker 4: lot more hectic to deal with multiple skews, and you
Speaker 4: see a lot of forklift drivers moving palettes to get
Speaker 4: to a palette behind it because of something that happened
Speaker 4: where you don't see that in an automated situation.
Speaker 2: Tracy, are you convinced now that we are indeed in
Speaker 2: the Golden Ager snack vision.
Speaker 1: In terms of technology? Yes, yes, well, and I am
Speaker 1: very intrigued by the idea that maybe in an era
Speaker 1: where people are eating less, if ozepic and the golp
Speaker 1: one drugs become even more popular, that food companies are
Speaker 1: going to have to offset that loss of consumption with
Speaker 1: creating new and tempting varieties of things to try. However,
Speaker 1: I will say not all of the flavors are evenly distributed.
Speaker 1: And you and I were experimenting with this earlier, trying
Speaker 1: to order particularly exotic varieties of stuff, and you can't
Speaker 1: find them everywhere. You can get most of the things
Speaker 1: off Amazon, but they're not in every grocery store. And also,
Speaker 1: like prices are still pretty high. Like I don't know
Speaker 1: if you've bought Lays or something recently, but it's kind
Speaker 1: of insane how much it costs nowadays.
Speaker 2: By the way, there's a lote Mexican street corn flavored
Speaker 2: elements which you can buy from Blue Diamond. I'm gonna
Speaker 2: buy them. Ryan Harlan, thank you so much for coming
Speaker 2: on Odd Lacks. That was an absolutely fascinating conversation and
Speaker 2: a great explainer of how technological innovation in the back
Speaker 2: end truly gives us this wonderful world of variety. So
Speaker 2: thank you so much. That was a lot of fun.
Speaker 3: Thank you for having me.
Speaker 1: Thanks Ryan, I've never been more hungry. Same Joe. You know,
Speaker 1: you mentioned the Mexican street corn flavor almonds, so this
Speaker 1: reminds me. I was in the supermarket the other day
Speaker 1: and I saw there were Mexican street corn a lotave
Speaker 1: flavored Cheetos, but and I was I was tempted. Okay, yes,
Speaker 1: but I didn't buy them because I think it was
Speaker 1: like eight or nine bucks for a pack a package,
Speaker 1: and I just couldn't. I couldn't justify it, like the
Speaker 1: novelty value.
Speaker 2: Just like maybe a one off though. Tracy, by the way,
Speaker 2: I did order some kit Kats and Dorito's before this,
Speaker 2: so maybe Tracy, you can, you know, and I'll bring
Speaker 2: them into the office.
Speaker 1: You'll subsidize my chip cons I'm saying, now you get
Speaker 1: those just like a good industrial policy.
Speaker 2: Shit return return the favor of me buying.
Speaker 1: I will bring you, Actually, I will bring you some
Speaker 1: of those Korean almonds, because now that we've been talking
Speaker 1: about them, I really want to go get some.
Speaker 2: But just this idea, so like, there were so many
Speaker 2: fascinating things in the conversation. For one thing, I just
Speaker 2: loved like how clear Ryan was about explaining how all
Speaker 2: these processes work. That was very cool. But then you think, Okay,
Speaker 2: you have this factory and you try to get some
Speaker 2: sort of like maximum like ninety nine percent up time
Speaker 2: or maximum groupput. You can understand once you've achieved a
Speaker 2: certain level of throughput, why you'd be really hesitant under
Speaker 2: the old regime two thousand and four to like let's
Speaker 2: try something new.
Speaker 1: Yeah, this is what I find really fascinating. So the
Speaker 1: idea that in this one respect, in the world of
Speaker 1: snack foods, it feels like technology has enabled risk taking. Yeah,
Speaker 1: and so often we kind of see it go the
Speaker 1: other way, like people's perfect stuff and then they kind
Speaker 1: of like double down on efficiencies and then they get
Speaker 1: sort of like hardwired into doing one thing perfectly. It's
Speaker 1: really interesting to me that in this world we're using
Speaker 1: technology to enable variety in a more efficient and maybe
Speaker 1: interesting way.
Speaker 2: Totally, and I love like the simple example that you
Speaker 2: don't think about, Like, Okay, let's say you have to
Speaker 2: clean the pipes, which of course you do between different
Speaker 2: flavor runs before you're like, well, the solution and making
Speaker 2: sure you have clean is to just let the washing
Speaker 2: process go along. So maybe thirty minutes, but what if
Speaker 2: you could do it in twenty minutes and you just
Speaker 2: those extra ten minutes are a waste and then you
Speaker 2: can like, you know, it's only seems like ten minutes,
Speaker 2: but what was it the rule of one percent? If
Speaker 2: you can find twelve one percent efficiency gains, then you
Speaker 2: can get an extra hour of throughput through factory, and
Speaker 2: if you're doing hundreds of pallets.
Speaker 1: Y, it's exponential.
Speaker 2: Yeah, so it's pretty cool.
Speaker 1: But also, you know, Ryan mentioned that game Factoria and
Speaker 1: the idea that okay, it's a video game, it kind
Speaker 1: of I've never played it, but it kind of looks
Speaker 1: like some city but for factories, and you create your
Speaker 1: own simulation of a manufacturing process. The idea that that's
Speaker 1: actually happening in real life. So you can come up
Speaker 1: with an idea and then you can use software to
Speaker 1: basically figure out how you would produce this with your
Speaker 1: current resources in the cheapest and fastest way. Presumably. That
Speaker 1: seems really interesting too, and a big difference to I
Speaker 1: guess how things were previously manufactured, where you would come
Speaker 1: up with an idea, you'd have to do all this
Speaker 1: research and development, lots of customer testing, but you'd also
Speaker 1: have to talk to the factory floor and figure out
Speaker 1: how you would make these new things.
Speaker 2: Totally. I want to like see one of the first
Speaker 2: of all, I want to play Factoria, or at least
Speaker 2: check out the trailer. It looks good, it looks really fun.
Speaker 2: And then also, yeah, this idea I think what digital
Speaker 2: twin I think was the term huge. So you could
Speaker 2: just create an entire digital version of the factory and
Speaker 2: if the simulation is good enough, then you just run
Speaker 2: the whole test in the digital twin. That's a really
Speaker 2: cool idea. Also, this idea that like that point at
Speaker 2: the end that robots still aren't very good, that if
Speaker 2: you could eventually it becomes a problem if too many
Speaker 2: of the bags are tilted and then they have to
Speaker 2: be manually reset. Seems like there's potentially low hanging fruit there.
Speaker 2: If I don't know, AI can make it so that
Speaker 2: the robot can just automatically do whatever. That's really exciting.
Speaker 2: Let's we should have Ryan back in twenty thirty four
Speaker 2: to talk about the state the state of snack food manufacturing.
Speaker 1: I'd be in that, and then maybe at that point
Speaker 1: we really will be in the golden age of snack foods,
Speaker 1: of cheap and abundant and interesting things to eat.
Speaker 2: Can't wait?
Speaker 1: All right? Shall we leave it there?
Speaker 2: Let's leave it there.
Speaker 1: This has been another episode of the Odlots podcast. I'm
Speaker 1: Tracy Alloway. You can follow me at Tracy Alloway.
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