QUESTION

PESTEL Analysis    

Conduct a PESTEL analysis on Beyond Meat by identifying as many external issues as you can that have an impact on Beyond Meat’s strategy. Identify which ones are opportunities and which ones are threats.
NOTE: For this assignment, ONLY analyze Economic and Ecological factors for Beyond Meat. (Does not have to be a whole PESTEL analysis)

Conclusions and Recommendations:
Use of analysis to draw logical conclusions and recommendations

Attached is just a reference.

 Beyond Meat goes public with a bang: 5 things to know about the plant-based meat maker

MarketWatch

Published: May 28, 2019 7:54 a.m. ET

Beyond Meat has a surprising number of competitors and plans to expand around the globe

Beyond Meat

By CIARA LINNANE, CORPORATE NEWS EDITOR

Beyond Meat Inc., the company created by vegan Ethan Brown in 2009, raised nearly a quarter of a billion dollars to grow its line of plant-based meats, with shares rocketing in their public debut.

The maker of the Beyond Burger, which is sold at Whole Foods and restaurant chain TGIF, among others, priced its initial public offering at $25 a share Wednesday evening, raising at least $240 million at a valuation slightly shy of $1.5 billion.

Beyond Meat BYND, +1.30% priced the IPO at the top of a range that it had already increased during the process. The company said in a regulatory filing Tuesday that it planned to offer 9.5 million shares priced at $23 to $25 each, updating the original plan to offer 8.75 million shares priced at $19 to $21 each. In the end, it sold 9.63 million shares, with underwriters holding the option to sell another 1.44 million shares in case of over-allotment. The stock began trading Thursday on the Nasdaq exchange under the ticker symbol “BYND.”

The first trade for the stock was $46 at $12:18 p.m. Eastern on Thursday, which was 84% above the IPO price. It extended gains to close its first day at $65.75, or 163% above its IPO price, making it the best performing first-day IPO in nearly two decades.

Goldman Sachs, JPMorgan and Credit Suisse are lead underwriters on the deal, with BofA Merrill Lynch, Jefferies and William Blair acting as co-managers. The company also makes plant-based pork and poultry products.

Proceeds of the deal will be used to expand current manufacturing facilities and open new ones, to finance research and development and to boost sales and marketing, along with the catchall “general corporate purposes,” according to the prospectus.

“As a young adult, I enjoyed a career in clean energy but continued to wrestle with a question born of these early days: do we need animals to produce meat?” asks Brown, who is chief executive as well as founder of Beyond Meat, in a letter included in the prospectus.

The letter explains how Brown set out to understand the history of human consumption of meat, acknowledging that it helped spur the increase in brain size that allowed our ancestors to become hunters, not scavengers, and led to the development of agriculture.

But the toll taken on human health, the environment, natural resources and animal welfare is a high one, he says, listing as examples of unintended consequences such illnesses as cancer, heart disease and diabetes.

“Livestock emerged as a major contributor of greenhouse gas emissions, with related burdens on land, energy, and water,” says the letter.

Brown argues that humans do not need to fully abandon meat, but to change the definition to one that considers composition and structure — amino acids, lipids, trace minerals, vitamins and water.

Those core elements are not exclusive to animals, but exist in the plant kingdom too, he says.

“The animal serves as a bioreactor, consuming vegetation and water and using their digestive and muscular system to organize these inputs into what has traditionally been called meat,” he writes

“At Beyond Meat, we take these constituent parts directly from plants, and together with water, organize them following the basic architecture of animal-based meat. We bypass the animal, agriculture’s greatest bottleneck.”

Beyond Meat’s strategy is to place its products in the meat case at its grocery partners with the aim of persuading meat lovers to try it out. The company does not try to market to vegans and vegetarians, who account for less than 5% of the U.S. population. The Beyond Burger is now available at about 11,000 of its 17,000 grocery-store customers in the U.S., says the prospectus.

It is also available at Canadian fast-food restaurant chain A&W.

Here are five things to know about Beyond Meat:

It has never made a profit.

Beyond Meat has successfully grown its revenue over the years, but has yet to produce a profit. In the first nine months of 2018, the company generated revenue of $56.4 million, more than double the $21.1 million posted in the year-earlier period, and more than the $32.6 million posted for all of 2017.

But its net loss in the nine-month period came to $22.4 million, only slightly less than the $23.4 million loss posted in the year-earlier period. The company’s loss for 2017 came to $30.4 million, wider than the $24.1 million loss posted in 2016.

“We anticipate that our operating expenses and capital expenditures will increase substantially in the foreseeable future as we continue to invest to increase our customer base, supplier network and co-manufacturing partners, expand our marketing channels, invest in our distribution and manufacturing facilities, hire additional employees and enhance our technology and production capabilities,” the prospectus cautions. “Our expansion efforts may prove more expensive than we anticipate, and we may not succeed in increasing our revenues and margins sufficiently to offset the anticipated higher expenses.”

Investors should also note that like many companies when they first go public, Beyond Meat is not planning to pay a dividend in the foreseeable future. That means investors must rely on stock gains to generate returns.

It has some big ambitions

Beyond Meat is expecting the alternative meat category to become a multibillion-dollar market over time and to take significant share from the $1.4 trillion global market for meat. The company is planning to mimic the

strategy used by the plant-based dairy industry, which currently is the same size as about 13% of the dairy milk industry at about $2 billion in 2017.

“The success of the plant-based dairy industry was based on a strategy of creating plant-based dairy products that tasted better than previous non-dairy substitutes, packaged and merchandised adjacent to their dairy equivalents,” says the prospectus.

Using that same strategy could boost the plant-based meat category to the same proportion of the roughly $270 billion meat category in the U.S. — or $35 billion in the U.S. alone.

The company has launched in Europe via contracts with three distributors and reports strong interest from European grocery and restaurant chains. It is planning to open manufacturing facilities in Europe in 2020. It also has a local distributor in Hong Kong and expects to expand in Asia over time.

It has a surprising number of competitors

Plant-based meat may sound like a niche market, but Beyond Meat says it is operating in a highly competitive environment. The company is competing with other plant-based protein makers, including Boca Foods, Field Roast Grain Meat Co., Gardein, Impossible Foods, Lightlife, Morningstar Farms and Tofurky. But it also views traditional meat companies as rivals, including such giants as Cargill, Hormel Foods Corp., JBS, Tyson Foods Inc. and WH Group , the owner of Smithfield.

Those companies have far more money and resources and their products are already widely accepted by consumers.

“They may also have lower operational costs, and as a result may be able to offer conventional animal meat to customers at lower costs than plant-based meat,” the prospectus says. “This could cause us to lower our prices, resulting in lower profitability or, in the alternative, cause us to lose market share if we fail to lower prices.”

Alternatively, traditional food companies may decide to acquire makers of plant-based foods and launch their own alternative protein products, using their size and scale to gain market share.

It needs a lot of one special ingredient

The main ingredient in Beyond Meat’s products is pea protein, an extract of yellow peas, which it currently sources from Canada and France. However, it has one single supplier of the protein, which represented 79% of net revenue in the first nine months of 2018. The company has already suffered supply interruptions from this supplier that caused delays in delivery.

The price of pea protein is vulnerable to a range of factors, from poor harvests caused by bad weather to natural disasters and pestilence, as well as changes in economic conditions and the number of farms that grow them.

Beyond Meat says it is working to diversify its supply chain and lock in prices through long-term contracts.

It does not have fixed contracts with co-manufacturers

A significant amount of Beyond Meat’s revenue stems from products that are made at facilities owned by co-manufacturers, including CLW Foods LLC and FLP Food LLC. CLW Foods is a California-based producer of ground beef, while FPL is a Georgia-based beef company.

But the company does not have written contracts with either company, meaning they could end or change the relationship at any time.

“We believe there are a limited number of competent, high-quality co-manufacturers in the industry that meet our strict quality and control standards, and as we seek to obtain additional or alternative co-manufacturing arrangements in the future, there can be no assurance that we would be able to do so on satisfactory terms, in a timely manner, or at all,” says the prospectus.

In the meantime, it is embroiled in litigation with a former co-manufacturer, Don Lee Farms. That company filed a suit against Beyond Meat in California in 2017, claiming its contract was wrongfully terminated and that the company shared trade secrets with subsequent co-manufacturers.

Beyond Meat filed a cross-complaint alleging that Don Lee Farms breached its contract when product was contaminated with salmonella and it failed to take actions to address that issue.

Beyond Meat IPO ‘extremely rare exit strategy in the highly centralized food industry,’ says GFI

FoodNavigator-USA.com

By Elaine Watson

02-May-2019 – Last updated on 22-May-2019 at 21:06 GMT

Beyond Meat’s decision to go public amounts to “an extremely rare exit strategy in the highly centralized food industry and is almost unheard of in the plant-based food space,” says The Good Food Institute (GFI), a nonprofit that promotes plant- and cell-based meat in a bid to displace animal agriculture.

Speaking as the El Segundo, CA-based company increased the size of its offering and raised its price range earlier this week, GFI executive director Bruce Friedrich said: “The only known exit of this kind was WhiteWave Foods’ initial public offering in 2012. This strategy raised $391m for the plant-based food company and positioned it for a $12.5bn acquisition by Danone five years later.

“This is a movement that goes beyond one company and it is accelerating rapidly, buoyed by surging investor support during recent years… Investors recognize that this is not a niche but a mainstream movement and a huge business opportunity.”

Beyond Meat – which is best known for its pea protein-fueled Beyond Burger, which sits in retailers’ chilled meat cases alongside conventional meat – is expected to start trading today on the Nasdaq under the ticker BYND.

The IPO (initial public offering) priced shares late Wednesday at $25, after heavy demand prompted the firm to offer 9.625m shares at an expected price range of $23-$25 per share, up from a previous estimate for 8.75m shares at a range of $19-$21. That would put proceeds from the IPO at about $241m, valuing the company at $1.49bn.

Bernstein: Beyond Meat could potentially generate annual sales of $2bn in 2033

According to Beyond Meat’s April 22 SEC filing, the total market size of the US meat industry across retail and foodservice channels is $270bn.

If plant- and cell-based alternatives can take a 15% share in 15 years (an estimate based on dynamics in the plant-based ‘milk’ category), the total addressable market for the US alternative meat category alone could be $40.5bn, noted analysts at Bernstein in a pre-IPO report released earlier this week.

“According to Euromonitor, Beyond Meat has ~2% market share in the US meat substitutes category in the retail channel today. Assuming it grows its market share to 5% and assuming the alternative meat market grows to the $40.5bn total addressable market in 15 years, Beyond Meat could potentially generate annual sales of $2bn in 2033 compared with $88m in 2018.

“Our steady-state market share estimate of 5% could be conservative as Beyond Meat has developed considerable moats in the plant-based meat category, and it could prove challenging for new entrants to play catch-up to develop products with similar taste and texture.”

According to Nielsen data in measured US retail channels examining LTM (last 12 months) dollar sales per item per store in the chilled meat patties category, Beyond Meat is ranked #3 out of 114 chilled meat patties brands, noted Bernstein.

“This strong, early set of results will likely encourage more retailers to introduce Beyond Meat and other plant-based alternatives to consumers in their meat aisles.”

How will Impossible Foods’ retail launch impact Beyond Meat?

That being said, the category has become more competitive with major companies such as Nestle and potentially Tyson entering the market, added Bernstein.

“It will also be worth monitoring Impossible Foods’ launch into the retail channel later this year and its potential impact on Beyond Meat…. [although] we believe both companies will be supported by the growth of the plant-based meat category and the market opportunity appears to be large enough for there to be more than one winner.”

Cell-based meat could also present meaningful competition over time, it added: “While plant-based meat appears to be leading the growth of the overall alternative market today, lab-grown meat or other types of alternative meat could potentially gain traction and take share from plant-based meat over time.”

Beyond Meat’s margins are better on chilled products

As for Beyond Meat’s financials (it generated net losses of $29.9m on net revenues of $87.9m in 2018), it improved its gross margin from negative -39% in 2016 to positive 20% in 2018 and expects gross margin to reach ~26% in the first quarter of 2019, noted Bernstein.

“The improvement has largely been driven by a greater proportion of sales coming from fresh products such as the Beyond Burger and Beyond Sausage which are sold at a higher price per pound and now represent ~76% of Beyond Meat’s retail sales in Nielsen’s measured channels compared with only around 15% in 2017.”

(Fresh Beyond Meat patties and sausages are sold at ~$10-12/16oz, whereas its frozen crumbles and the recently discontinued chicken strips are sold at $7-9/16oz.)

‘A highly speculative investment?’

Writing in Forbes yesterday, David Trainer, CEO of New Constructs, LLC, an independent research firm in Nashville, said: “More than any of the other recent IPOs I’ve covered, BYND looks to be a highly speculative investment.

“The company’s market cap looks unrealistic based on its $88m in annual revenue and mounting losses. On the flip side, the opportunity could be large, given the $1.4tr size of the global meat industry and the $22bn market cap of major meat producer Tyson Foods.”

Beyond Meat extracts protein mainly from yellow peas, weaves it into a fibrous structure by applying heating, cooling, and pressure at varied intervals, and then adds additional ingredients such as water, lipids, flavor, color, trace minerals, and vitamins to replicate the taste and texture of animal-based meat.

The chilled segment of the meat alternatives category has gained share at the expense of the frozen segment in retail in recent years, representing 47% of the meat substitutes market in 2018 compared with 26% in 2004 based on Euromonitor data analyzed by Bernstein.

The big winners in recent years have been Beyond Meat, Gardein and Field Roast, while legacy products such as Kellogg’s MorningStar Farms and Kraft Heinz’s Boca that targeted the vegetarian and vegan population have lost meaningful share in recent years according to Euromonitor data.

“In addition to products that are already in the market, Nestle recently announced the launch of its new plant-based Garden Gourmet Incredible Burger in Europe in April 2019 and the rollout of a slightly different variation called the Awesome Burger in the U.S. later this year,” said Bernstein.

“Further, major meat producers could also choose to enter the plant-based space to diversify their exposures. Most recently, Tyson was reported to have sold its stake in Beyond Meat on April 24, 2019, a week before Beyond Meat’s planned IPO, due to tensions between the two companies as Tyson looks to launch its own plant-based meat products.

“While these large players are likely years behind Beyond Meat, Impossible Foods, and select others from a product development perspective, they could still pose a meaningful challenge given their manufacturing capabilities and retailer relationships.”

Source: Bernstein report, May 2019

The Promise and Problem of Fake Meat

It could help improve public health and reduce climate change. But questions remain about the highly processed food—and some producers’ coziness with the “real meat” industry.

By EMILY ATKIN

June 7, 2019

We have a meat problem. It’s a key driver of the climate crisis, drinking water pollution, and land overuse. And excessive consumption of factory-raised and processed meat increases the risk of cancer, heart disease, and diabetes.

You probably know all this, but you still eat meat. Most of us do. Why is that?

According to the psychological theory of cognitive dissonance, humans experience extreme stress when there is an inconsistency between our beliefs (“Meat-eating is bad”) and our behaviors (“I like eating meat”). Our brains resolve the dissonance by altering either our beliefs or our behavior. “It is most likely that the attitude will change to accommodate the behavior,” Leon Festinger, the theory’s originator, once wrote. So most humans, even those who know that meat-eating is bad, make excuses for their behavior rather than adhering to their beliefs and giving up meat.

That’s a problem for our personal health, and that of the planet. But what if we could have it both ways? What if we could eat meat without the consequences?

That’s the big idea behind Beyond Meat and Impossible Foods. The competing food companies, which have grown rapidly over the past year, might be famous for creating vegetarian burgers that look, taste, and bleed like beef. But that’s not they’re trying to do. They’re also trying to change the world by changing what society believes meat to be. In a way, it’s a scientific solution to the cognitive dissonance of eating meat.

“If we insist meat be defined by origin—namely poultry, pigs and cows—we face limited choices,” Beyond Meat founder Ethan Brown wrote in a shareholder letter last month. “But if we define meat by composition and structure—amino acids, lipids, trace minerals, vitamins, and water woven together in the familiar assembly of muscle, or meat—we can innovate toward a solution.” Impossible Foods’ strategy is similar. The company, according to a recent feature in Engadget, “needs society to discard a fundamental cultural idea that dates back millennia and accept a new truth: Meat doesn’t have to come from animals.”

If humans can accept that, Brown wrote, then “we can provide meat that delivers health benefits and environmental upside (90 percent fewer greenhouse gas emissions, 99 percent less water, 93 percent less land, and 46 percent less energy) and side steps the animal welfare issue.” Humans today will become “the first generation … to separate meat from animals, unlocking the next era in the American story of innovation, disruption, and growth.”

The idea is appealing in its simplicity, and appears to be working. Beyond Meat’s products are now sold in the meat section at more than 35,000 grocery stores nationwide, and Impossible’s products are sold at more than 7,000 restaurants, including fast-food chains like Burger King. Beyond Meat’s IPO was the most successful of 2019 so far, giving the company a market value of $3.77 billion. Impossible Foods, a private company, is valued at about $2 billion.

Beyond Meat and Impossible Foods have the potential to help solve one of the stickiest problems in the climate fight. But amid all the excitement about that potential, there’s been little analysis of the problems these companies could create. After all, their products are highly processed and scientifically engineered food. Might different health problems emerge from a large-scale replacement of meat, which, for all its problems, is still a whole food? Also, the global “real meat” industry is investing in plant-based companies. Should we trust the same industry that caused our health and environmental woes to help solve them?

Traditional meat products usually have one ingredient. These newfangled meatish products are more complicated. The Impossible Burger has 21 ingredients, and the Beyond Burger has 22. Impossible’s main contents are soy protein isolate, sunflower oil, and coconut oil; Beyond’s are pea protein isolate, coconut oil, and canola oil. The oil in each product is supposed to mimic beef’s fat content; the soy and pea proteins mimic the protein content. Both plant-based burgers contain water, salt, and the binding agent methylcellulose. Both are gluten-free.

The most notable ingredient-related difference is that Impossible uses genetically modified soy protein, drawing criticism from anti-GMO groups. Impossible also uses genetically modified soy leghemoglobin—also known as “heme”—which gives the burger its meaty flavor and red, blood-like drippings. Heme wasn’t considered safe for consumption by the FDA until last summer, and Impossible still must go through the regulatory process for getting heme approved as a color additive, which will be required if the company wants to sell the uncooked patty in grocery stores.

Controversy over heme aside, consumers can at least take comfort in the fact that they know what fake meat is made out of. What they can’t be confident in is exactly how it is made. It’s pretty clear how a cow becomes a hamburger. But Beyond Meat and Impossible Foods consider their specific recipes and production methods to be trade secrets. What we do know is that Impossible makes its own burgers, and Beyond Meat does not.

If Beyond Meat did manufacturer its own products, it might have had to disclose some of its production methods when it went public earlier this year. But the company did have to disclose who makes its plant-based patties. According to the IPO filing, its products are made by two ground beef manufacturers: California-based CLW Foods LLC and Georgia-based FLP Food LLC. Neither CLW or FLP has ever publicized its affiliation with Beyond Meat; their websites advertise beef production only. And neither company has a written contract with Beyond to produce the Beyond Burger, the filing stated. They operate via a handshake agreement.

It’s a curious arrangement, and it illustrates the traditional meat industry’s longstanding interest in fake meat’s success. “Since 2015, global meat giants from Tyson to Cargill have invested in high-momentum, animal-free protein startups seeking to upend the traditional meat industry,” reads a report last year from CB Insights, a research firm that specializes in startups. Indeed, Cargill, the world’s third-largest meat producer, is investing in pea protein for plant-based meat. Tyson and PWH, one of Europe’s largest chicken producers, have invested in Beyond Meat—and Tyson recently exited its investment to start its own plant-based meat brand. Last fall, Perdue Farms announced it is also looking into its own line of plant-based products.

They have good reason to. According to Euromonitor International data, the entire meat substitute market is worth about $1.44 billion, and expected to grow to $2.5 billion by 2023. Big meat companies want to tap into that—especially since, according to Beyond Meat’s IPO filing, plant-based alternative meats have the potential to soon take up 13 percent of the meat industry, just as plant-based milks now make up 13 percent of the milk industry. That would surely mean huge reductions in greenhouse gas emissions from the meat sector.

But big meat companies—some of which which emit nearly as much carbon as oil companies like ExxonMobil—don’t intend to be replaced. They plan to use their investments to keep their core business growing. “This isn’t an ‘either or’ scenario,” Tyson CEO Tom Hayes said of his decision to launch a competing plant-based meat brand. “It’s a ‘yes and’ scenario.”

Bottom of Form

Perhaps we should apply different standards to the meat and fossil fuel industries. They may be two of the largest contributors to the climate crisis, but meat, unlike oil, is something most us regularly touch, feel, and taste. It’s personal, and thus much harder to demonize than fossil fuels.

It makes sense, too, why Americans might believe that the answer to the meat problem lies in a scientific lab, rather than in our stomachs. Science has long driven the modern food industry. When our diets were too high in fat and cholesterol, food scientists created low-fat products. When we lacked vitamins, scientists invented nutrient fortification. We are, as Michael Pollan argued in In Defense of Food, “nutritionists”—people who believe “that the nutritional value of a food is the sum of all its individual nutrients, vitamins, and other components,” and that if we can simply create foods that have better nutritional profiles, we will be healthier.

Beyond Meat and the Impossible Burger do have better nutritional profiles than beef burgers: Less calories, more protein, less fat. Compared to a 4-ounce beef burger with 20 percent fat content, a Beyond burger has 20 fewer calories, 3 fewer grams of fat, and one more gram of protein. An Impossible Burger has 50 fewer calories, 8 fewer grams of fat; and the same amount of protein. Both plant-based burgers have no cholesterol, compared to 80 milligrams in a beef burger. And both have more fiber, essential for bowel regularity. Combine that with the large body of research linking meat consumption to disease risk, and you have a pretty convincing case that the world’s health would be better off if we replaced traditional meat with these products.

But that case only works if you ignore the large body of evidence that processed food consumption contributes just as much, if not more, to obesity, cancer, and other disease risk. The most convincing piece of evidence, laid out in Pollan’s book, is that people who eat a Western diet—made up of 60 percent processed foods—are uniformly unhealthier than people who eat diets made up of mostly whole foods. Even when the whole foods are high-calorie, high-fat, or high-meat, Pollan shows, the people who eat them are still less obese and less disease-ridden than Americans.

The evidence is not just anecdotal. In the last month alone, the National Institutes of Health released a landmark study showing that America’s obesity epidemic is driven primarily by ultra-processed foods, and two large European studies linked ultra-processed food consumption to cardiovascular disease and death. While we may notnot know exactly how Impossible or Beyond burgers are made, they clearly fall into the ultra-processed category. They were literally created in scientific labs. Their proteins are isolates, extracted mechanically from whole soy and peas. Their fats are industrial vegetable and seed oils.

In fact, companies like Impossible and Beyond have arguably created a new, higher tier of ultra-processed food. As Engadget noted, “A Cheeto or Twinkie is unambiguously synthetic.” But these fake-meat products are engineered, specifically, to fool our senses into thinking they’re whole foods—and then marketed, by meat companies, to change our language to reflect the trick. This is nutritionism at its finest, and its success so far reflects the lengths we will go to avoid changing our behavior: We would rather change the entire definition of meat to include something we know isn’t meat, rather than eat less of it to save the planet and ourselves.

Emily Atkin is a staff writer at The New Republic

Why some restaurants are turning up their noses at Beyond Meat

MarketWatch

By JEANETTE SETTEMBRE

Published: Aug 3, 2019 10:33 a.m. ET

Chipotle, Arby’s and Burger & Lobster are not jumping on the Beyond Meat and Impossible Foods plant-based culinary movement

Burger & Lobster

The meatless movement is prompting some restaurants to beef up their offerings.

Beyond Meat — the plant-based substitute that looks, tastes and bleeds like real meat in the form of burgers, sausages, beef crumbles and taco filling — has sprouted up at some of the country’s biggest restaurant chains and retailers from Dunkin’ to Whole Foods.

Beyond Meat went public in May with the biggest IPO since 2008, but some restaurant chains aren’t sold on the alternative protein.

Beyond Meat went public in May with the biggest IPO since 2008, but some restaurant chains aren’t sold on the alternative protein.

Chipotle says plant-based meat like Beyond Meat and its competitor Impossible Foods are too processed for its menu.

When asked if the chain would consider adding a plant-based meat to restaurants, Chipotle CEO Brian Niccol told Yahoo Finance: “We have spoken to those folks and, unfortunately, it wouldn’t fit in our ‘food with integrity’ principals because of the processing, as I understand it, that it takes to make a plant taste like a burger.”

And last month Arby’s, the Ohio-based chain known for its roast beef sandwiches, appeared to be trolling the meatless movement and using it as a platform to publicize new offerings for carnivorous diners with the launch of the “Marrot,” a fake carrot made entirely out of meat. Arby’s dubbed it the world’s first “meat vegetable.” The chain said the Marrot is made with 100% turkey breast and a carrot marinade made from dried carrot juice powder. It’s said to contain 30 grams of protein.

Some chefs are proceeding with caution by not jumping on the alternative meat bandwagon and serving something they haven’t prepared themselves.

“We thought about it, but we’re sticking with our [meat] burgers and lobster,” Danny Lee, the executive chef of Burger & Lobster, a London-based restaurant with locations in New York City, told MarketWatch.

Plant-based faux meat can be attractive for consumers looking to cut down on red-meat consumption, but nutritionists say alternatives to meats aren’t always much healthier, and sometimes meat eaters may even be better off ordering the real thing.

“Are they healthier as far as sodium, calories and fat content? Definitely not,” Sharon Zarabi, a registered dietitian and bariatric program director at Lenox Hill Hospital, told MarketWatch in June.

At Burger King, for example, the meatless Impossible Whopper, available at select locations, is 630 calories, compared to the regular Whopper, which is 660. (The Impossible Whopper is made with soy protein, potato protein, coconut oil, sunflower oil and heme, a molecule that makes it look and bleed like real meat).

Both have around the same amount of fat (34 grams of fat, and 11 grams of saturated fat for the Impossible Whopper; and 40 grams of fat, and 12 grams of saturated fat for the Whopper). The meatless version has 1,240 milligrams of sodium verses 980 for the meaty one.

Beyond Meat and Impossible Foods did not immediately return a request for comment.

Consumers are also paying more for the meatless version: $5.19 for the Impossible Whopper and $4.19 for the regular Whopper.

Zarabi says processed foods, whether they’re meatless or meat-containing, are never the healthiest choice. Processed food has been associated with a higher cancer risk, a study published in the British Medical Journal last year found. People who had a 10% higher intake of ultra-processed foods — typically foods that are higher in fat, saturated fat and added sugar and sodium — had more than a 10% increase risk of cancers, the study, published in the British Medical Journal last year, found.

Not all restaurants are offering faux meat alternatives

Some restaurants are turning their noses up at offerings such as those from Beyond Meat. Shake Shack’s CEO Randy Garutti told CNBC in June it had no plans to put out a plant-based product.

But others have participated in the meatless trend. Dunkin announced last week it would become the “first U.S. restaurant chain to sell 100% plant-based Beyond Breakfast Sausage.”

Some 95% of people who purchased a plant-based burger this year also ate meat.

Burger King, White Castle, Red Robin and Del Taco have also started offering menu items made with plant-based meats. And McDonald’s has also been rumored to break into the alternative meat market.

Meat-eating consumers appear open to trying alternative proteins. Some 95% of people who purchased a plant-based burger this year also ate meat, new data from market researcher NPD Group shows.

What’s more, there were 228 million servings of plant-based burgers at quick service restaurants this year, up 10% from a year ago. And while beef burgers are still the most popular burger on menus with 6.4 billion ordered, growth is flat compared to a year ago, according to the same report.

Some restaurants are betting on diehard carnivores. Burger & Lobster recently beefed up its brunch menu with a Lobster Steak & Eggs item consisting of an 8-ounce Flatiron Steak and a 1.25-pound lobster served alongside two eggs and potato hash.

Lee, Burger & Lobster’s executive chef, noted that his restaurant sells a mushroom burger for vegetarian clients. However, he said there’s not enough demand for meat alternatives, and he feels it’s still unclear whether alternative meat products that mimic meat will be a fleeting or lasting trend.

“If you’re going to make a plant burger bleed,” he said, “why not just have a regular burger with simple ingredients done well?”

Beyond Meat Has Completely Altered Its Go-to-Market Strategy

What happens when a pandemic disrupts an industry disruptor?

Asit Sharma, The Motley Fool, Aug 5, 2020 at 2:08PM

The first six months of 2020 have visibly transformed Beyond Meat‘s (NASDAQ:BYND) approach to marketing its plant-based, meat substitute products. The company’s second-quarter 2020 earnings report, released Tuesday after the markets closed, revealed that it’s still experiencing rampant growth. Total revenue jumped by 69% against the prior-year quarter to $113.3 million. And the organization continues to spill a slight amount of red ink, generating a loss of $10.2 million over the last three months versus a loss of $9.4 million in the second quarter of 2019.

But beneath these numbers, the dynamics of Beyond Meat’s business model have been radically altered by its response to the COVID-19 pandemic. In the second quarter, U.S. retail sales (mostly through grocery channels) almost tripled to $90 million, while foodservice sales in the U.S. plunged by 61% to $6.5 million.

Part of this shift happened without much intervention by management, as consumption in restaurants and other institutional foodservice outlets has plummeted since the spring, while at-home consumption has soared.

Yet Beyond Meat’s management made a critical decision during the second quarter to change course on product distribution. To illustrate, the company repackaged a portion of its slow-moving food service inventory for retail consumption. This wasn’t a cheap decision — Beyond Meat incurred a charge of nearly $6 million to repack and reroute this inventory in response to consumer demand. But for a young organization that wants to leapfrog rivals in gaining plant-based mindshare, the shift isn’t illogical, and it may result in a durable competitive advantage.

Flipping the customer acquisition equation

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