Innovation & Technology Innovation & Technology

Sweetgreen's Uphill Battle to Transform Fast Food

By Leon Kaye | Published 8 years ago | About a 7 minute read

It’s a great time to be a salad on a fast food menu. A generation ago, there was no happy medium between lunch hour at a fast food joint or at a sit-down restaurant — and either option was, and still is, calorie-laden. But concerns over the nation’s food supply, growing environmental awareness, and the disturbing obesity rate here in the U.S. has led to the growth of the “fast-casual” food concept, and many chains in this category are more socially conscious than conventional restaurant chains. These upstarts, which include Shake Shack, Panera Bread, Pieology and Chipotle (despite its recent troubles), have become what the conventional fast food restaurants are often not: they have a reputation for quality, are relatively healthful, staffed by workers enthusiastic about their products, are attractive inside, and are also a place where environmental and social awareness are part of the companies’ DNA. Plus, while not dirt cheap, these restaurants are for many people still affordable.

One company riding this wave, and doing so quite successfully, is Los Angeles-based sweetgreen. Founded by a trio of Georgetown University students who bemoaned the lack of healthy and affordable eating options in that D.C. neighborhood, sweetgreen has since expanded to over 40 locations. Beyond its strongholds in the D.C. metropolitan area, New York, Boston and Philadelphia, outlets have since opened in Los Angeles, and new locations in the Chicago and the Bay Area will soon open.

And for the first-time visitor, walking into a sweetgreen is likely a quite different experience from other options in one’s neighborhood. In keeping with what the company says is an unwavering commitment to sustainability, sweetgreen strives to preserve the original structure and appearance of the buildings in which their locations operate, “no matter the cost.” Exposed brick, wood, and even bowling alleys are maintained to prevent any cookie-cutter look. A large board near the cash registers, announcing the farms and dairies at which its current menu ingredients are sourced, greets customers. And for those who prefer a carbonated drink with their custom-made salads or bowls, forget it: your favorite fizzy drinks from the likes of PepsiCo and Coca-Cola are not available.

“We know we could make a lot of money from having soda on the menu, but that is not what we’re about,” said Nicolas Jammet, one of sweetgreen’s co-founders, during an interview with Sustainable Brands.

sweetgreen’s unconventional approach has earned the company plenty of favorable press, from Fortune to the New Yorker to even Vanity Fair. Much of this attention is because of sweetgreen in Schools, a program the company sponsors that educates schoolchildren about healthful eating, sustainable living and physical fitness. Launched six years ago in D.C., this program has since spread to Virginia, Maryland and New York, usually in neighborhoods lacking stores where fresh foods can be purchased — or in what are often referred to as “food deserts.” The company claims over 4,000 students have been reached by this curriculum, and it expects that number to double this year, with lessons such as “Eat the Rainbow.” Targeting fourth and fifth graders, sweetgreen in Schools visits four or five times during a school year.

“We’re big believers that being a brand like ours can create healthy food through the impact of marketing,” Jammet said, “and that it is possible to celebrate healthy food the way junk food has been celebrated the past 50 years.”

The challenge that sweetgreen and its competitors in the marketplace face, however, is the fact that one of its $8 to $15 meals in Manhattan, Santa Monica or Dupont Circle is certainly affordable to those who live and work in those neighborhoods. But for many Americans, spending that amount of money on a meal is still an indulgence.

Not that this is the fault of sweetgreen, which has grown thanks to an innovative business model built on the low-tech of farming and the high-tech of apps. First, the company has developed long-term relationships with local farmers and artisan food makers, which has allowed those suppliers to sell more of its products to sweetgreen at a competitive price.

But a company devoted to fresh and local produce like that of sweetgreen faces a problem: scale. Farmers want to ensure that if they are going to grow copious amounts of organic kale or heirloom carrots, they will have a market. Customers who develop an affinity for a certain dish will become frustrated if it disappears from a menu. Jammet and his co-founders have spent many a weekend combing farmers’ markets, developing relationships and trust. One of sweetgreen’s loyal suppliers is Firefly Farms, an artisan dairy in Accident, a hamlet of 300 people in Maryland’s panhandle.

“It took years and years to build this track record,” Jammet said, “and we found a way to commit to them — allowing them to increase their business, and for us, to build our community and brand.”

Meanwhile, the company has embraced technology: according to Fortune, 30 percent of sweetgreen’s transactions are made via a smartphone app, and 1 percent of those revenues in turn help fund the aforementioned school education program. In turn, such a cycle, relying in part on favorable reviews on social media channels (on the same phones that order those lunches), can only be beneficial, according to Jammet.

“We’re big believers in conscious capitalism — the more we can buy from certain farmers, the more stores we can open, the more people we can hire, and the more we can cook and serve, we can therefore create real change,” he said.

Another big barrier for sweetgreen and other companies dedicated to transforming food supplies: subsidies. Critics have long bemoaned U.S. subsidies for corporate farms and livestock producers, which allow the cost of potatoes, wheat and beef to remain relatively low. Hence that hamburger’s price, say critics of the fast food industry and farm subsidies, is often cheaper than that of a salad. Add the costs of Medicaid and SNAP (Supplemental Nutrition Assistance Program, or “food stamps”) paid to workers who often toil within fast food restaurants, and the big fast food chains score a massive financial advantage, say many labor leaders and sustainable food advocates. Jammet, however, claims workers at sweetgreens are paid a competitive wage.

“There needs to be policy reform, including making sure people earn a fair wage,” Jammet said, “and I think that in general the most exciting thing is that companies like ours have put the conversation out there.”

While Jammet repeatedly pressed that his company was undergoing an “evolution” and was committed to providing food education in underserved neighborhoods, sweetgreen’s locations show that the company is arguably preaching to the choir. Two new stores will soon open in the Bay Area — in Berkeley and Palo Alto, areas that have already long been part of a “food revolution” and where the restaurant’s price point will strain few, if any, local residents’ or commuters’ budget.

What about locations in the South Side of Chicago or along Harlem’s 125th Street corridor — areas that are enjoying an economic revival but could surely benefit from a healthful eating option? “They have been on our radar,” Jammet insists.

Once such fare is readily available in such neighborhoods, then sweetgreen and its allies in the sustainable restaurant movement can truly say they are making headway in the long struggle to transform America’s eating habits.