Walmart is making an investment in sustainable vertical farming brand Plenty in the company’s most recent $400 million funding round.
Jan. 26, 2022
In light of the pandemic, vertical farming has seen a huge uptick, and there are still plenty — excuse the pun — more businesses entering the space. Sustainable practices are becoming commonplace for big businesses, but it’s not just out of necessity, it’s for efficiency too.
What does Plenty do?
Plenty is a green vertical farming producer. Vertical farming is an indoor method to grow produce on stacked building structures which makes the most out of condensed spaces. Companies supplied by Plenty can source produce for goods all year round, not just fresh fruits and vegetables that are in season, and quality can be maintained by avoiding lengthy logistics chains. On top of that, it’s better for the environment because it requires less water and chemical interference with plants, crops, fruit, and vegetables.
What does Walmart’s vertical farming investment mean?
Walmart’s (NTSE: WMT) benefits are two-fold. On one side, it supports sustainability practices within the company that contributes to the company’s economic social, and governance goals, and it also satisfies consumer demand.
Walmart’s dedication of resources to more sustainable resources going forward will benefit the supply chain by giving them more control in inventory planning, and by eliminating time constraints. Vertical farming allows year-round growing, meaning seasonal produce won’t be an issue. The method also requires less water and a reduction in the use of pesticides which makes it a more sustainable solution for obtaining fresh produce in the future.
Consumers are also increasingly demanding more fresh produce goods, as evident from a Deloitte survey in which 40% of shoppers were willing to pay a premium for fresh food products. Although only valued at $3.2 billion in 2020, the vertical farming market is set to grow at a 23% compound annual growth rate from now until 2030. With a steady population increase worldwide, we can assume this industry will only continue to grow a whole lot further in the next, 20, 30, even 50 years. This will put Walmart ahead of the curve in the long run.
Walmart is making sure it’s on top of consumers’ needs and wants from start to finish, whether that’s by delivery, curbside pickup, or through online shopping. And that’s no different when it comes to the products it stocks on its shelves. As one of the best-known brands in retail, it’s no surprise it’s taking every measure possible to prepare for a sustainable future, for the planet, and for its business.