Maren's Profile

Plenty is a promising concept, but upon reading this article I found myself wondering how it can possibly produce 350 times more produce than a conventional farm and still be cost effective. As discussed above, they save some money by using gravity instead of pumping the water but can it overcome the additional costs from software and machine learning algorithms used for water management?

Fast Company did an article on Plenty that highlighted the company’s claims to grow crops at equal or lower cost than in the field. [1] To me, achieving this is the true game changer. Environmentally friendly farming solutions will continue to fail as their predecessors did until they are able to provide the same quality as the field for equal or lower cost.

Interestingly this article claims that on top of achieving the cost, Plenty’s farming methods also allow them to grow crops that previously weren’t available due to the fragile nature and the long supply chain (>3000 miles in many cases). By locating indoor urban farms closer to population centers they can provide rare varieties of mizuna, lettuce, kale and more that typically would get damaged in transport. This is where I believe they will compete with large conventional farms. Although they don’t have the efficiency of scale they are physically closer to the consumer, environmentally friendly, and offer a new array of produce. Overall, I agree with your plan for future growth (managing energy costs, expansion selection, leveraging infrastructure) but I think it depends critically on Plenty achieving these lofty cost and efficiency claims.

[1] Peters, Adele. “Has This Silicon Valley Startup Finally Nailed The Indoor Farming Model?” Fast Company, Fast Company, 30 June 2017, http://www.fastcompany.com/40420610/has-this-silicon-valley-startup-finally-nailed-the-indoor-farming-model.

Very interesting topic Charlie, I appreciate hearing the diverse solutions proposed in the comments because I had the same reaction as you that Tesco has a very difficult road ahead, likely requiring radical changes. Similar to PC above, I was surprised at just how successful the discount stores have been in the post Brexit era. The New York Times had an article that showed both Aldi and Lidl experienced double-digit growth for over 12 weeks this summer. They highlighted the previous stigma of shopping at discount grocers and how that started changing with the financial crisis and now even more post Brexit. Customers, especially younger shoppers, are increasingly willing to purchase generic items to avoid the premium on brand names. [1] This trend toward generic friendly shopping is likely one of the main reasons discount stores have been able to grow post Brexit when costs of imports are increasing.

Although historically Tesco has competed in the upmarket space, I wonder if their new focus on keeping prices low is the start of a new era. They will inevitably need to implement many of the suggestions discussed in previous comments as well (increasing domestic production, long term contracts, supply chain efficiencies) but a shift towards discount may also help them compete in the changing grocery market.

[1] Tsang, Amie. “As Brexit Nears, ‘Discounters’ Gain Ground in U.K. Supermarket Wars.” The New York Times, The New York Times, 3 Aug. 2017, http://www.nytimes.com/2017/08/03/business/britain-brexit-supermarket-inflation.html.

Great insight, I appreciate using Ford as a case study for what many manufacturing companies are surely debating today. I agree with your argument that Ford should focus on the long-term view of low cost manufacturing. However, I believe that in the long-term China may not actually be cost effective due to the rising labor costs and additional transportation costs for the 45% of Ford sales in the U.S. Labor costs in China have more than quadrupled since 2006 and BCG estimates that regions of the U.S. may already be within 10-15% of the wages in China. [1]. On top of that, manufacturing domestically saves development costs, trade costs, and as Vanessa mentioned, increased automation will likely further reduce the wage parity between the U.S. and China. Thus, for these economic reasons as well as the trade risks Eugene highlighted, I am hesitant to back Ford’s decision to move to production to China.

[1] Morris, David Z. “Will tech manufacturing stay in China?” Fortune, 27 Aug. 2015, fortune.com/2015/08/27/tech-manufacturing-relocation/.

Interesting perspective, while I agree with you that it is critical for Google to identify and utilize any advantage they can get over Apple, I question whether they will be able to integrate the HTC team sufficiently. To unlock the benefits of a fully digitized and transparent supply chain, Google would need to be deeply involved in the HTC production system. My doubt here stems from Google’s previous foray into hardware with their purchase of Motorola in 2011. Google ran Motorola as a separate team, unable to mesh their software core with the new hardware entity before ultimately giving up and selling it off to Lenovo in 2014. [1] What will Google do differently to ensure that the HTC purchase doesn’t end in a similar outcome? I hope that Google can overcome the Pixel supply issues and provide a strong competitor to the iPhone, but I worry they still have a lot of growing to do before they’re successful as a hardware company.

Pierce, David. “Google Paid HTC $1.1 Billion To Turn Itself Into a Phone Maker.” Wired, Conde Nast, 20 Sept. 2017, http://www.wired.com/story/google-htc-smartphone-agreement/.

Great essay, Levent. Thanks for highlighting this issue because we often assume electric cars have a lower environmental impact without considering the entire supply chain. I find it ironic to learn that a plant in Germany is estimating a 50% increase in greenhouse gases due to their electricity mix, which will be used to manufacture batteries for an electric car designed to reduce green house gas emissions.
One additional aspect that I believe will be critical to VW’s “Roadmap E” strategy is the development of the grid used to power this new wave of electric cars. According to the EPA, close to 70% of the U.S. energy generation still comes from fossil fuels and I expect that to be even higher in developing countries. [1] How much benefit can we actually get from electric vehicles if drivers are charging them off of a coal powered grid? How will VW and other automotive companies encourage a cleaner grid to power their vehicles in the future?

[1] “About the U.S. Electricity System and its Impact on the Environment.” EPA, Environmental Protection Agency, 24 Jan. 2017, http://www.epa.gov/energy/about-us-electricity-system-and-its-impact-environment.