Running Everything From the Farm to the Restaurant: The Opportunities and the Problems | How's the Organic Business Doing, Part 2

QDaily is devoting at least four articles to the state of China's organic business. This is the second: the restaurants that champion "farm to table."

"Farm to table" has become a new way of eating. Its biggest advantage is that diners, if they care to, can know exactly where their food came from.

Unlike farming, organic dining has no government rulebook — no regulations have been issued for it to date. But organic restaurants, and restaurants running on a similar idea, tend to care a great deal about where their ingredients come from. Put another way, "farm to table" has also turned out to be the best way to market organic food: it demonstrates a reassuring way of eating without ever saying the words "food safety" or "organic."

Over the past decade, almost every chef in the United States has been talking about this model — even the agricultural biotech company Monsanto and McDonald's have joined in. One of its finest practitioners, Dan Barber, chef at the one-Michelin-star Blue Hill in New York, calls it a counterattack on a global food economy that has been eroding culture and cooking: "It's directly connected to seasonality, to place, and to farmers, and at the same time you get to taste better food."

In 2002, the Taiwanese company Yuen Foong Yu won organic certification for its farm in Kunshan. But it found that on the mainland nobody understood organic food — not buyers, not consumers — so it had to sell its produce abroad instead. By 2010, when Yuen Foong Yu decided to move into the mainland market, general manager He Yijia chose to open restaurants so that consumers could taste for themselves what organic actually meant: "They'd feel the vegetables taste different, that organic meat has more flavor."

Yuen Foong Yu now runs two restaurant brands, Green & Safe and Qimin Shiji, where diners can also find produce from the Kunshan farm, sauces Yuen Foong Yu makes itself, and seafood and meat from partner suppliers. The company is trying to create a one-stop shopping experience: beyond the restaurant, He Yijia wants consumers to treat these spaces as a market selling organic goods.

The model has been running for more than five years, and Yuen Foong Yu did not invent it. According to a report in CBNweekly, the Shanghai restaurant Jishi began ordering organic sprouts from Verdura Farm back in 2013 and displayed them in the dining room to promote the idea of eating produce the moment it's picked. But a restaurant with hundreds of mu of land, free to decide what it grows and raises, has far more latitude in choosing what to sell and how much of it.

Now more and more competitors are coming in.

Hunter & Gatherer, founded in 2015 and now with four locations, has one farm in Shanghai and another in Shandong, and two of its restaurants have retail sections selling produce, nuts, bread, and cold-pressed juice. The Xintiandi branch stresses the origin of its ingredients most of all: before you order you have to walk through the produce and nuts, and everything — the farm photographs on the wall, the wood-framed shelving, the volcanic rock — reminds you that a "farm" stands behind it.

Green & Safe and Hunter & Gatherer share one obvious advantage: the richness of the experience — partly the setting, partly the goods.

These "farm to table" restaurants buy more the way a buyer's boutique does: the operators recommend their own products, along with the partners they have vetted. What they buy in is lined up neatly on shelves, which makes everything outside the dining area feel like a small specialty market. For now, these places are also popular backdrops for street-style photo shoots among the fashionable — while another set of fashionable diners eating nearby watch the shoots happen.

Commercially, the model makes it easier to explain to customers what is unusual about your ingredients. It amounts to invisible promotion: consumers notice more readily that the food coming out of this kitchen is not the same as at other restaurants, and that the restaurant has enough faith in its ingredients to invite you to buy some and cook them at home yourself.

Anmao Sun, Hunter & Gatherer's founder, says that commercially the model is "very logical." It isn't hard to see why: it readily lifts a restaurant's sales, because a customer who eats in and likes what she's eaten may well buy some produce to take home while she's there.

It may also build long-term customers. He Yijia offers an example: they have seen people buy a whole week's ingredients at once. "You only eat at a restaurant now and then. We want them to actually be able to eat organic every day."

But restaurants that preach "farm to table" have plenty of trouble to sort out, whether or not they own a farm.

Hemmed in by acreage, climate, soil, and much else, even a restaurant with its own farm cannot possibly grow everything it needs. Which means every organic restaurant has to work with ingredient suppliers.

As we discussed in the previous piece, for all sorts of reasons a farm run to organic standards does not necessarily hold organic certification. Some organic restaurants will work with an uncertified "organic farm" they consider trustworthy anyway, and check the quality of the ingredients in their own way. Tribe, which has locations in both Beijing and Shanghai, spent a full year surveying farms in Beijing alone.

That demand for quality creates a problem: organic restaurants cannot change suppliers casually, because confirming that a new one meets the standard costs both time and money. Anmao says that when an ingredient costs more than Hunter & Gatherer's target, they still can't simply swap in some other supplier whose product barely clears the minimum on taste. "We want to be partners with our suppliers, not just have suppliers."

So restaurants have to live with swings in the quality and yield of what their suppliers grow — one of the problems that comes with organic farming's insistence on nature, and with what that insistence does to a restaurant's dishes. When luck runs against you, a freshly picked organic crop won't necessarily taste the way customers want it to.

Yu Min, Tribe's founder, told QDaily that they revise the menu when an ingredient can't be supplied, or when the taste or the look isn't right. Last summer, for instance, they had a tomato soup that people loved; now the tomatoes are nearly ripe but don't taste "very good," so this year they may have to cut back on dishes with tomatoes in them. In many seasons watercress turns bitter, or yellows and looks stale, which has forced Yu Min to strike several dishes from the menu.

Beyond that, seasonal vegetables may draw customers, but they also mean the menu has to keep shifting with the season. Tribe and Hunter & Gatherer both change menus once a quarter, redesigning a great many dishes each time.

The "organic" label can even frighten customers off. He Yijia says organic is "sometimes a plus, sometimes a minus," because some people assume that food this healthy and this safe must taste awful. "Asking them to eat organic is like asking for their life."

Anmao, for his part, has found that once customers notice how much Hunter & Gatherer cares about where its food comes from, they file it under health — and in their minds, healthy equals not tasty. "We've actually never emphasized health."

The cost of organic ingredients, plus all the constraints that come with them, pushes a restaurant's costs up.

By Anmao's reckoning, if they switched everything to ordinary ingredients, the restaurant's gross margin would double. And with ingredient costs already high, in order to "bring our ingredients and our food to more people," Hunter & Gatherer aims to hold dish prices between 60 and 75 yuan — which forces them to keep every dish under 15 cooking steps, cutting costs so they can serve food fast and in volume.

The idea of "organic" isn't necessarily trusted, either. One food safety scandal after another has left consumers doubtful even about government-recognized organic certification, let alone the part of the business that isn't certified at all.

One reason Hunter & Gatherer came up with "Real Food" instead of using the word organic is precisely that distrust: "If organic is something people really don't accept, then we shouldn't pick a fight over it." Tribe, whose ingredients are 70-80% organic, mostly avoids calling itself an "organic restaurant," because some of its partner farms skipped certification — it costs too much — and so cannot produce visible numbers to prove the ingredients really are organic.

Even the staff at these restaurants need extra training. On top of what any restaurant employee learns, they have to know where every ingredient comes from, explain how the place works to customers who have never heard of organic or "farm to table," and handle all the questions that come with putting organic and healthy food first — customers unused to little oil and little salt tend to ask "why is this so bland?" or "why is this dish so expensive, what's different about it?"

Understandably, no one is going to overhaul their eating habits or give up on flavor just because they want to eat organic. As John Mackey, CEO of Whole Foods, the company that led America's organic boom, put it recently: "Maybe you have the highest ideals in the world and you try to educate people… but in the end you need to sell people what they want to buy, or you won't have a business." To last, an organic restaurant has to find a way to persuade its customers to pay comparatively high prices for dinner.

Most of its ingredients come from nearby, but Qimin Shiji still sells food from all over the world — Brittany oysters from France, Australian wagyu, New Zealand green-lipped mussels — which plainly cuts against Yuen Foong Yu's environmental case for "farm to table." He Yijia's answer is that "some of those food miles aren't as long as you'd imagine," and that they try to balance what customers expect of them against what they believe.

Tribe lives with the same contradiction. Yu Min sees "no way around it": they import organic wine, olive oil, cheese, and more, because China doesn't sell suitable versions. What they can do, as she sees it, is refuse the requests they think are wrong — if a customer wants bottled water like Evian or Perrier, she trains the staff to explain why that isn't environmentally sound. "And if the customer can't understand that, then maybe he isn't our customer."

Look at the restaurants built on organic and healthy food and you'll notice that a lot of them serve casual Western meals. Yu Min explains that Chinese cooking runs at high heat with a lot of oil and salt, so "most dishes are hard to make very healthy." Healthy ingredients alone don't make a healthy dish, which is why more organic restaurants have gone for casual food — comparatively healthier, and easier to adapt.

That brings a problem of its own. Plenty of Chinese customers are happy with a casual lunch but want something more formal for dinner, so foot traffic falls off noticeably in the evening.

Hunter & Gatherer has spent six months experimenting with this — designing dishes better suited to sharing around a table and to dinner, and replacing the order-and-carry-your-own-tray arrangement with waitstaff seating you and serving the table. They still haven't found an answer that works.

Hunter & Gatherer also wants more Chinese customers, so it is rewriting recipes — adjusting heat and salt, for instance. Anmao thinks the dishes are still too foreign, too boring for Chinese diners. "We didn't come here for foreigners."

Tribe, facing the same evening slump, has revised its menu too, adding more dinner and cocktail options to pull in as many kinds of customers as it can and lift the average check enough to offset the thinner crowd. "Overall, revenue has held up pretty well."

All three restaurants are expanding and opening new locations. Anmao says Hunter & Gatherer's sales are growing about 10% a year; Tribe's first location grows 20% to 30% a year.

Tribe has run its business around "health" since the day it opened — "you always know what to measure everything against." In fact, Yu Min says, what she promoted when the restaurant first opened wasn't only the restaurant but the idea of eating healthily. Beyond the dining room, Tribe also runs talks and fitness events, sponsors tennis tournaments, and works with brands like Lululemon.

From the way she spends her days, it's easy to see that what she's selling isn't a few meals but an idea about eating and the community that grows out of it: "What we do is a pretty niche business. In China there aren't many of these people to begin with, so what we care about more is loyalty."

Hunter & Gatherer set out to "change the way Chinese agriculture produces food." Two years in, it has discovered that even with the farm's name painted on the restaurant wall, its own customers still overlook where the food comes from: "Even the customers who come in every day don't necessarily know we have a farm."

So Anmao and his colleagues have decided to start marketing this year, putting out a newspaper to tell customers about the farm behind Hunter & Gatherer. They also plan to hold a "real farmers market," with the farmers at the center of it rather than the dishes restaurants usually like to talk about.

The hardest part of practicing "farm to table" looks like promoting a way of life. But the deeper worry is that the pace of supply from the farm will hold the restaurant back — because compared with plain marketing, improving the soil and working out a sensible way to grow things is the part that eats the time. Two years after founding Hunter & Gatherer, Anmao has found that it is not as easy as he thought.

"The change has been big, but the speed of change hasn't really been what you'd imagine," he told QDaily.

Images: Tribe, Hunter & Gatherer, Yuen Foong Yu, and photographs by the reporter.