Explore the transformative impact of artificial intelligence and automation on the produce and floral industries with host Vonnie Estes and guest Joe Don Zetzsche. With insights from Joe’s extensive experience, the episode delves into AI’s role in reshaping retail, revolutionizing floriculture breeding, and redefining supply chains. Discover strategies for growers and retailers to adapt and thrive amid rapid technological advancements. As AI models grow exponentially, understand how embracing these changes can unlock abundance and sustainability in everyday business practices.

Key Takeaways

•         Exponential Growth Understanding: Joe explains the concept of exponential tech growth and its implications on human understanding and industry evolution.

•         AI in Retail: AI is revolutionizing retail operations, with companies like Amazon and Walmart leading through data integration and automation.

•         Impact on Medium and Small Retailers: Smaller retailers may face challenges without strategic adoption of AI technologies, potentially paying other companies to fill those gaps.

•         AI’s Role in Floriculture: AI’s integration in breeding processes is leading to more resilient and higher-performing floral varieties, highlighting future potentials for genomics and CRISPR technologies.

•         Cultural and Economic Shifts: Consumer acceptance of AI-driven services, like delivery of perishables, signals a cultural shift towards automation-enhanced convenience.

Guest Resources

•         Joe Don Zetzsche: Currently supporting the floral and retail industries through consulting.

•         International Fresh Produce Association (IFPA): Fresh Produce

For more insights into how AI and technology are reshaping industries, listen to the full episode and stay tuned to “Fresh Takes on Tech” for more thought-provoking discussions.

Show Links

International Fresh Produce Association - https://www.freshproduce.com/

Fresh Takes on Tech - https://www.freshproduce.com/resources/technology/takes-on-tech-podcast/

Facebook - https://www.facebook.com/InternationalFreshProduceAssociation/

Twitter - https://twitter.com/IntFreshProduce/

LinkedIn - https://www.linkedin.com/company/international-fresh-produce-association/

Instagram - https://www.instagram.com/intlfreshproduceassn/

0:00:01 Intro Speaker: Welcome to Fresh Takes on Tech, the podcast exploring what’s next in food and agriculture through the lens of innovation and technology. Hosted by Vonnie Estes, each episode features conversations with people driving change in the produce industry. From entrepreneurs to scientists to industry leaders and policymakers. This isn’t about hype. It’s about real conversations with people who are making a difference.

0:00:24 Intro Speaker: Let’s get into it.

0:00:26 Vonnie: Welcome to Fresh Takes on Tech. In today’s episode, we’re talking about one of the most powerful shifts shaping our future. Artificial intelligence and automation. This is the last episode of our season focused on AI, and we’re wrapping it up with a conversation that brings everything together, from breeding to automating supply chains and improving customer experience. The technologies converging right now are poised to reshape how we grow sellers sell and experience product.

0:00:56 Vonnie: My guest today is Joe Don Zetzsche. It will be hard to tell everything that he has done in floral and retail. 35 years with H.E.B. past chair of PMA and he was very instrumental in forming IFPA. He’s now continuing to support the floral industry and retail through consulting. Joe has been closely following what he calls an explosive wave of exponential tech growth. Growth which we’ll talk more about. He’s here to help us understand where AI and robotics are making an impact today, where they’re headed next, and what growers, retailers, and floral professionals need to do to prepare.

0:01:36 Vonnie: We’ll explore how retailers already are using AI, how breeding and operations in floriculture might be transformed, and what the future floral supply chain could look like when robotics, automation and AI all collide. Welcome, Joe. It’s so great to see you.

0:01:52 Joe: It’s my pleasure.

0:01:53 Vonnie: So let’s talk about this explosive wave of exponential tech growth. What does that phrase mean to you? And why should people in retail and for all care about it right now?

0:02:03 Joe: You know, as human beings, we really have a challenge understanding what exponential growth means. The idea of something doubling at a regular pace. We just have a hard time understanding that we our lives are based in a linear fashion. Once second, second goes to the next and seconds become minutes and minutes become hours. Our entire experience as human beings is linear. But exponential things exist that have existed in the technology world for 70 years.

0:02:34 Joe: And there’s a parable that I’ve heard there’s many out there that try to help us think through what exponential means. But if you think about if you’re giving your child an allowance and you give them a dollar every day for 30 days, right at the end of the 30 days they have $30, they’ll have a stack of $1 bills about a quarter of an inch thick. But if you gave them that allowance exponentially, which means the first day you gave them $1, the next day you gave them $2, the next day you gave them four, the next day you gave them eight.

0:03:06 Joe: At the end of 30 days, you would have a stack of $1 bills. I got it written down. 73 miles high in 30 days. You can’t grasp it, but when things are doubling at a regular pace, every time doubling what just happened and then doubling again, the pace gets faster and faster and faster. And Moore’s law has been in effect with computers and computing technology since the 1950s. Every 18 months or so, compute has doubled for, by the way, half the cost.

0:03:41 Joe: And that has been happening and happening and happening. And so, you know, when we think about that, we can look back in our lives, those of us that have been around a while, it can think about how long it took for us to get from email on an old DOS based mainframe system, which is what we use at H.E.B., where I started H.E.B., and it was new technology to be able to send emails to each other on that old green screen, right?

0:04:08 Joe: How long it took to get to the World Wide Web. But how quickly we moved from the World Wide Web to companies that were digital only, right? Some of the two, first two companies to get websites were 1-800-Flowers and FTD. They both got their websites before Amazon got there.

0:04:25 Vonnie: I didn’t know that. That’s fascinating.

0:04:27 Joe: They did, they were already selling flowers across telephone lines and they just adopted the World Wide Web. But then Amazon came along and we saw the growth of digital companies. But then you think about when that technology began to double and the impact was felt more rapidly. We went from pagers to smartphones to BlackBerrys to a true smartphone, sorry, a cell phone to a BlackBerry to a true smartphone.

0:04:54 Joe: And with Apple first produced the first smartphone, I was like, big, big whoop. It’s a music player that’s also a phone. That’s all it is, right? That’s what it was when they launched. It really was all it was. But then you think about the explosion of apps that occurred in that system as that power doubled, as you went from cell to 3G to 4G to 5G, which enabled things like Uber and Lyft and all the scooters all over all the urban centers that are powered by GPS and 5G, that speed continues to get faster and faster, but it’s doubling.

0:05:31 Joe: It’s doubling every year. And the fact is it’s the AI world. As we moved from machine learning to deep learning to large language models, as the power of compute has continued to grow. There’s I’m hearing now that AI compute where right now over a billion dollars is being invested every single day. Another billion dollars in AI compute. I’m hearing that for the last two years, AI compute has grown at a rate of 10x every six months.

0:06:01 Joe: Not even exponential 10x every six months. And so that speed is hard for us to wrap our brains around. A new technology is slow at first. We think about Netflix and how slow it grew to where it got. The same is true of something like driverless technology. We’ve had cruise control systems with LiDAR that you would pace a car in front of you now for about 10 years. Right. And you saw that slowly grow to LIDAR based taxi services. I rode in one at a convention in Phoenix.

0:06:35 Joe: Loved it. Loved having a driverless taxi drive me around. There wasn’t music cranked up, I didn’t like there were 10 air fresheners in there. It wasn’t speeding. Loved it. But driverless technology is exponentially growing at the same pace. And so we are now in a place where this foundation of large language models and artificial intelligence is now empowering all the entrepreneurs in all other spaces. So you have automation, robotics, synthetic biology, recombinant DNA research using CRISPR and even new technologies that are doubling the skill sets of that.

0:07:11 Joe: Right.

0:07:12 Joe: All of that is now doubling together. But it’s the large language models that are building that. You know a couple quotes I’ve heard around AI or large language models as we know them today. One leader in the space said that AI was the same as electricity, the same impact on humans as electricity has been. But I heard a leader since then say, no, it’s more impactful than that. It’s actually the same impact on the human race as when we discovered fire.

0:07:42 Joe: You think about humans understanding we could create fire and cook our food and how that changed us. AI is having the same impact across every part of our life. And everything that we live with today was created for the most part pre AI. Everything will be rewritten and recreated with AI as we move forward, I believe in the next 10 years. And so that level of change we have to embrace and understand because it’s going to impact every part of our lives.

0:08:14 Joe:

0:08:15 Vonnie: So given the enormity of that, which I definitely feel as well, what are retailers actually doing with AI today? Kind of, if you’re A retailer. And you’re sitting there and you just listen to Joe Don talk about exponential growth. What are people actually doing with it in real world situations?

0:08:34 Joe: So retail has a lot of different scales in retail. I guess I’ll start to answer that question by talking about what Craig Boyan, who’s the president of H.E.B., he spoke at an FMI conference that’s a convention for the, for the supermarket retail channel. And he spoke, this is more than four years ago and he spoke and he said that in retail there’s a massive race occurring today. And the race is between digitally native companies learning to become great in person retailers while at the same time mass retailers are learning how to become digital companies.

0:09:13 Joe: And he said the winner of that race would dominate the markets in the future. And if you think about that, you can really see who the leaders are in this space. Amazon is in the lead in this space because they are digitally native. They have the strongest data. They built their company based on the idea that every single unit is, is puts their data in the same data lake. They all share that information now. It’s in the cloud. Now you know, Amazon Services is how many small businesses run their business.

0:09:44 Joe: Any portion of their revenue to Amazon. Amazon is in the lead, I would say. And they have over a million robots in their facilities today. They only have 1.5 million workers. And it’s projected in the next two years they’ll have more robots or automation tools than they have humans. The one that’s competing the hardest against them is Walmart. And you see changes at Walmart. You know, Doug McMillan, their CEO, has said recently, I wish we’d move faster.

0:10:12 Joe: I wish we had moved all in into tech faster with more money involved. And you know, they bought Jet a decade ago when people were like what are they doing that for? But you know, today they have over a million robots. They just opened a fully automated PDC perishable distribution center. Fully automated, right. The, the pallets go into a Rubik’s cube like grid. Just like when you think about Amazon warehouses and they’re moved around and machines pull those pallets to the right spot and they select cases.

0:10:43 Joe: It flows to a machine that palletizes them and then it gets loaded on a truck. But you see where they’re going. And it was just of course, first of all, I think it was announced that a month ago they have two C suite leaders at Walmart focus on integrating AI into all of their business. Two leaders at the senior level, chief officer level. And it was announced last week that ChatGPT or OpenAI is going to build a new certification learning model and their goal is to train 100 million people by 2030 on that model.

0:11:18 Joe: And their foundation partner or sponsor for that work is Walmart. And Walmart is going to Deploy certification of ChatGPT and all the ChatGPT models on Walmart University. That’s the level of commitment that Doug McMillan at the C Suite, right, the CEO and the board of Walmart has committed to deploy AI across their entire business. And of course Walmart being, we’ve all known them for decades as being supply chain first, right?

0:11:49 Joe: They have the data, I think in a more powerful way than many other retailers. And that data is going to enable them to rapidly move in, deploying more automation and more AI tools across everything they do to their business. I think they’re far in the lead.

0:12:05 Vonnie: I was at one of their distribution centers in Shafter which is not quite 100% automated. But before they opened the newest one, it was the closest to that. And like you said it was, I really, I mean it was, to me it, it just shook my world to actually see standing there and seeing those pallets all going different directions and they had this one room that it’s well below freezing, I forget the exact temperature but they’re like, no one wants to work in there. That’s a horrible place to work. And so now no one has to work in. You know, he said people would come out with like frozen beards and like health issues and now, you know, nobody has to work in the sub zero area. But it is really amazing when you see the scale of someone like Walmart, you know, really embrace this technology and what difference it makes.

0:12:54 Vonnie: So when you look at Amazon and Walmart are here and the amount of money they put into and we see where they’re going. What about more medium sized and smaller? How are people embracing the technology and is the divide going to get wider and wider between the big guys and the small guys?

0:13:13 Joe: I think the next tier of retailers are retailers that have focused on customer knowledge and have also focused on deploying e-commerce for themselves because that forced the level of data pooling, getting all of your data in one place, that’s required for AI. So Kroger of course has been focused on customer level data for decades. They first with Dunn Humby and now they have brought it in house and you know, they partner with Ocado to try to really go after e-commerce in a big way. They now they’re looking at that and saying maybe that’s not the best model for e-commerce at Ocado centers. But I would say that they’re in the race because they have that level of skill. If we look at companies like H.E.B. that from day one invested in their own technologies for curbside pickup and for delivery of groceries are further along.

0:14:03 Joe: But what you also have is just as we talked about, as you know, smartphones came on and apps came on. Entrepreneurs are currently building really smart tools with these platforms as a base.

0:14:16 Joe: Right.

0:14:16 Joe: And in some cases they’ll pick and choose. They’ll use, you know, Claude for some of the analytics, but they will be some of the extensions of website coding, but they’re using chat GPT for other pieces. But it’s a front page. And so some of the companies you’re seeing now are investing in technologies that are built on AI. Most recently last week I saw Schnutz announced that they were deploying an AI based recipe and production system in all their stores.

0:14:43 Joe: So it will manage the recipes and the production planning for their bakery apartments, for fresh produce, for cut fruit. And that’s AI based. So it’s using models to predict and it’s using the data to learn.

0:14:57 Joe: Right.

0:14:57 Joe: To help them predict that based on the rain forecast and based on that store’s customer time of day, time of week, day of week, they need to produce this many cut watermelon bowls in their fresh produce department.

0:15:12 Joe: Right.

0:15:12 Joe: And because it’s AI, it’s continuously learning and as the better it’ll get better.

0:15:17 Joe: Right.

0:15:18 Joe: Just as I saw recently, I’m sure you’ve seen, you know, that there’s an AI predictive model now for hurricanes that’s doing better than all of the other models that the National Weather Service owners have used to predict hurricane activity for decades. AI is learning every day. So I think you see retailers that are buying systems for specific parts. I think many retailers are looking at their marketing and their advertising because there’s many ways you can quickly speed that up.

0:15:48 Joe: Many are looking at their supply chain roles, especially in center store that are more systematic. You’re buying from one CPG company, one group of items and you’re maximizing trucks based on your supply chain. They’re implementing AI faster there. But I do think, you know, we’re at a place because again, it’s exponential, it’s doubling, it’s doubling, you know, no slower than 18 months.

0:16:15 Joe: Right.

0:16:15 Joe: We every day we go, things are moving so fast now and realize things are moving as slow as they ever will.

0:16:24 Vonnie: Yeah, it’s only going to get more.

0:16:26 Joe: Because the models are going to be twice as fast and twice as good between six months and 18 months from now, depending on who you talk about.

0:16:34 Joe: Right.

0:16:35 Joe: And Quantum computing, which five years ago people were saying it’s going to take 20 years. No, there are quantum computers happening right now.

0:16:42 Joe: Right.

0:16:43 Joe: Because again, it’s doubling, it’s doubling, it’s not linear. And so I worry that small retailers and medium sized retailers, especially those that have offloaded some of this work. Right. Somebody that used Instacart to do their e-commerce work, which means the customer data lives in Instacart, it doesn’t live company. Their corporate tools are still much more fractured. They couldn’t figure out how to do it, so they pay somebody to do it for them.

0:17:11 Joe: I worry that that’s a model and I think that retailers need to get engaged quickly or they may find they can’t keep up. And it’s. So some point another company is going to own a big chunk of that work for them and will charge them a percentage of their revenue to do that work for them because they will be able to catch up fast enough to do it for themselves.

0:17:32 Vonnie: That’s fascinating. So what happens to Instacart in that scenario? If everyone says, okay, we don’t want them to have our data anymore and we’re going to develop our own systems, does Instacart go away or what happens to them?

0:17:45 Joe: I think of it the way that I’ve seen restaurant technology grow in the last three or four years. You’ve probably seen it. Many small restaurants, individual restaurants, have deployed systems like Toast where they fully automate from kitchen all the way to payment. They can do takeout orders on Toast’s website. Toast does points. You know, that restaurant is paying a percentage of their revenue to that in order to have those skills.

0:18:11 Joe: But, but they’re able to stay in business because of it. I think that Instacart will likely, for a good while be the tool that enables smaller retailers to compete effectively. But just like with having technology again, I keep going back. This exponential change is going to affect everybody the way it did technology.

0:18:30 Joe: Right.

0:18:31 Joe: And think about computers. Remember when Apple II was the big gun? But remember Gateway computers?

0:18:38 Vonnie: Not very well.

0:18:40 Joe: They don’t exist. But they created a model that was completely different than anybody else’s and they dominated home computers for five years. And then Dell came along and they kind of disrupted them in technology companies come along that no one’s heard of and completely disrupts and takes the business away from the previous tech person. I think we’re going to see more and more of that happen with digitally native companies that are based in AI, I think the big guns are going to be there. Microsoft is going to be there.

0:19:12 Joe: They’ve doubled down investment. Apple’s going to be there. Nvidia is going to be there powering them. But I think other companies will end up replacing what Instacart does for retailers with something more powerful. And here’s the long term view, my view, this is where I get out my murky crystal ball. But I think about, you know, having led everything from checker through running stores, all the way through leading a business in a really good mass retailer that really understands their customers.

0:19:45 Joe: I think that somewhere between 90 and 95% of the things that I would buy at an H.E.B. store today, the best H.E.B. there is, including in store created things like hot tortillas, fresh made cakes, fresh produce chopped and cut, you know, ready to cook meals, I think if I could get all of that delivered to my home and put in my refrigerator by somebody else for 15 or 20% or even 40% cheaper than H.E.B. does it today, I would switch.

0:20:16 Joe: At that point H.E.B. becomes a theater that I go to to experience foods. And they’ll probably still be there making money, but a big chunk of their revenue will go to whoever is fulfilling all the rest of the things that I buy. And again, the one to lead the race is Amazon. I’ve been an Amazon prime member for years. I always said I’m not going to buy anything that I can buy from H.E.B. because I was a leader of H.E.B.

0:20:44 Joe: But today I buy something on Amazon and they start suggesting food to me. Would you also like you just bought a new part for your toilet, but do you also want to buy some cantaloupes on the same delivery delivered in the next four hours? Yeah, when that cantaloupe is fresher, but it’s also 40% cheaper than the cantaloupe in a traditional supply chain mass retailer. I’m probably going to say, yeah, give me that cantaloupe.

0:21:12 Vonnie: Culturally, do you think consumers, I mean, you always hear people say, I don’t want anyone to pick out my produce. I don’t want, you know, I want to pick out my own produce. I want to go to the store. I haven’t ordered produce online yet because I am one of those people that wants to go to the store. But what’s that cultural shift going to be like when people are going to try it and say, okay, that cantaloupe was maybe even better than I would have picked myself. You know, how does that cultural shift happen?

0:21:39 Joe: It’s happening today depends on the store. There are stores at H.E.B. that upwards of 40% of their volume is now delivery. Between curbside pickup and delivery, but mainly delivery. Think about urban Austin where you now have a super tall and you have more super tall skyscrapers coming in. Just getting to a store is hard and they order delivery. I think it depends on the item and how relevant is that item culturally to you and the use of that item.

0:22:05 Joe: I think a bagged salad, whichever brand you buy, as long as it’s within code date and fresh. Why would you switch it right ahead of cabbage? Because you’re going to make some coleslaw and then the coleslaw kit, you know, that’s a fresh coleslaw dressing you’re not worried about. But if you want avocados to make guacamole and you want to have very ripe pasta, avocados, right? Or when stone fruit is in season and you really want fully ripe peaches because you’re going to serve them at a dinner party today, that’s where I think today that division occurs.

0:22:39 Joe: But you know, one of the things that’s true is the best retailers, one of the reason they’re so good, if you look at H.E.B., if you look at Wegmans, if you look at Publix, when it comes to fresh, one of the reasons they’re so good is they have such velocity. They’re turning that product so fast. Their sales per foot in those fresh departments is so much more than everybody else that they’re fresher because they’re selling so much.

0:23:03 Joe: Right.

0:23:04 Joe: As long as they’re maintaining the cull.

0:23:06 D: Right.

0:23:06 Joe: We know in fresh produce you’ve got to cull that 4 or 5% quality defect. Not quality defect, but not condition defect, but quality. Right? So scarring, scuffing, misshape. The things a customer would look at and go, I don’t want that banana because that has little scars on it. There’s nothing wrong with that banana.

0:23:24 Joe: Right?

0:23:24 Joe: But American consumers buy with their eyes and especially if you get digitally, if there’s any imperfection at all. Oh, they screwed me.

0:23:32 Joe: Right?

0:23:32 Vonnie: Yeah.

0:23:32 Joe: Was it Seinfeld that said they they something to you at the drive thru? They screw you in the drive thru right. And so you have to be perfect. But as long as you’re calling appropriately, that velocity gives you the freshness. And so I think strong tech companies that are able to do this robotically, which I believe is going to happen. Yeah, I know you had Elliot Grant on the call one of your. It was your first one and he said he didn’t see humanoid robots harvesting fruit.

0:23:59 Joe: I absolutely disagree. If you look at figure AI, they just had around C evaluation of 1 billion infused into their company this summer. And you take robots and they partner with folks who do film and have people wear glasses as they do work so that they can cut videos to then teach the AI built in their robots. There’s no reason why a humanoid robot who is built on our bodies, why we couldn’t teach it with the AI that’s coming to do anything that we do. I fully believe I will have a robot in my house for less than $30,000 by the end of this decade.

0:24:38 Joe: Doing my laundry, cleaning up the dog fur from my Saint Bernard, putting dishes in the dishwasher and putting away my groceries and watering my lawn. I think that’s coming and I think it’s going to massively change retail as well. And so that velocity will help people adopt. And at some point you’re always going to have 10 or 20% that are not going to, but a big portion of the volume is going to be with those that win.

0:25:07 Vonnie: Let’s switch a little bit and talk about floral, another passion of yours. So you’ve written and spoken a lot about AI’s impact on floriculture. How has AI already influenced breeding and what might the next few years look like? In floriculture and AI?

0:25:24 Joe: It is rapidly speeding up the breeding practices of the best breeders. One of my clients, I’m blessed to say I, I am on retainer with Delafloor, the market share leader in chrysanthemum breeding. And I was at their farm in Medellin, Colombia, Rio Negro, Colombia, last month where they were showing their new varieties just like in fresh produce in other areas that you have spoken on, your tech talks through the ability to rapidly get to the genome of any biological item and understand the markers for different themes. So you, you think about resistance, right? You think about, I have a chrysanthemum that is resistant to white rust, but I have this beautiful chrysanthemum that does it today. They can quickly see the genetic markers that make this variety resistant.

0:26:16 Joe: And then through AI, look at the best parents that are like this one, that is beautiful, that they need to breed with in order to build that resistance. And over time using that, they can much more rapidly get to the pairing that grows that resistance, which enables us to be much more sustainable right. And have much more productivity because as they create varieties across an item type, like chrysanthemums that are resistant to all the different pests and all the different biological things that can cause damage, then that’s going to help. And then if you can also use that same technology to look at the ability to store it at colder temperatures with it still perform, which means now perhaps you could put it on ship containers and take two weeks to get to the retailer. Whereas today most of the flowers are flown every day from Bogota airport into Miami airport.

0:27:12 Joe: Now, you have a much lower cost, much more sustainable way, right, to grow flowers. But you go further, I think, you know, where we’re headed is in most of the world, right? And there’s parts of the world that say that call anything GMO is bad. I think that’s a mistake, honestly. But when we look at floriculture, you know, we don’t eat it. The fact is that ornamental flowers today, a lot of people don’t know this, but ornamental flowers today, like carnations, chrysanthemums, bees can’t even pollinate it.

0:27:43 Joe: We have bred it through human focus, right, with a paintbrush, breeding to make these crossings to have such dense petal structures that a bee couldn’t pollinate naturally anyway, these bee varieties to create these ornamental flowers that we love. So if we could use CRISPR and we could find the right again genetic marker that adds fragrance back to roses, all roses genetic marker that allows flowers to stay in stasis at 34 degrees for three months and still come out of that in water and perform for two, three, four weeks in a home.

0:28:26 Joe: There are varieties of plant that will do that, right? So as we learn and use that, I think we can really again make things more sustainable. Because one of the things in the floral industry is we have these massive seasonal spikes, right? 10%, at least 10% of our volume annually in the fresh cut flower industry happens in one day. February 14th.

0:28:49 Vonnie: Wow. Yeah.

0:28:50 Joe: 10%. And for some companies it’s much more than that. So if you could harvest a smaller group of greenhouses that have rose vines that take three years to get to production, and you’re harvesting about one and a half blooms a month from which is on average the productivity you get for rose plants. But you can put those roses in storage and hold those roses, you know, November, December, January, and then pull them out and give everybody the exact same experience, all of a sudden it’s so much more sustainable, right, because it’s fewer greenhouses producing them, much lower cost.

0:29:28 Joe: And again, that will translate to roses that last longer in the home, which makes people adopt them more. So as we look at the future of synthetic biology and using AI to control and think about genetic modification, there’s no question that floral could lead the way there even faster than food products.

0:29:47 Vonnie: Yeah, because people would accept it.

0:29:50 Joe: People want a tomato that tastes like that vine ripened tomato in your garden. But are they willing to use a genetically modified tomato to do that? I think at some point they will. That’s my own personal opinion. But for flowers, I think that’s certainly an opportunity. So that will impact the entire supply chain. Just the way we can use AI in the breeding and selection and crafting of the genetics we use in the flowers that we sell.

0:30:15 Vonnie: What about in production and robotics? Do we think we’re going to have more robots in production? And are people worried about job loss? And what’s the conversation around that?

0:30:25 Joe: Absolutely. So it’s happening right there at Chrysanthemum Week. There were some folks that went to another greenhouse that saw an automated planting machine that was planting the cuttings from the mother plants. And they said it was about, it might have been slightly slower than the best humans that do that work, which is very tedious work. I mean, you’re literally bent over and putting these plugs in the ground.

0:30:51 Joe: But, it was much more precise and uniform, which meant that you’d have better production from those plants because it’s producing, it’s, it’s planting them so uniformly. That’s happening today. But I can tell you that there’s a lot of consolidation happening in fresh cut flowers in particular right now. It’s happened in greenhouse plants as well. There’s a lot of consolidation happening because you have companies that now have access to capital, whether it’s their own or it’s invested capital to deploy part of their company and scale against more and more land.

0:31:28 Joe: I had dinner with a good friend of mine that I believe is now the largest flower grower in the world. And we talked a lot about the automation that is already being deployed. I saw a warehouse in the floral space that was just as we described Amazon. You know, a much smaller footprint warehouse that’s much taller, that is entirely made up of a grid of one pallet in size and machines are moving those pallets around so that grower is already using that level of automation.

0:31:58 Joe: But we had a cheap philosophical discussion about as we deploy AI and automation and people lose jobs, will that impact consumption and at what level do we want to choose to do that? As it becomes available. And this grower has their own automation arm. They have automated machines that have their brand name, a floral grower name on their automation.

0:32:21 Vonnie: Oh, wow.

0:32:22 Joe: And that consolidation is happening rapidly. And again, it’s going to double. It’s going to double.

0:32:28 Joe: Right.

0:32:29 Joe: So they will soon be in driverless trucks. There’s no question. They just announced they’re going to test driverless 18 wheelers on i35 between Laredo and Dallas, coming right through downtown San Antonio every day. But they’ve been running for over five years now on i45 between Houston and Dallas. If you drive interstate at night, you will see lines of trucks and there’s nobody in the cab. They’re completely driverless.

0:32:53 Joe: Running that. It’s about a five hour drive and they’re driving.

0:32:57 Vonnie: Really?

0:32:58 Joe: Yeah.

0:32:58 Vonnie: That’s amazing.

0:33:00 Joe: It’s running on the interstates right now. And again, these are still newer companies, but it’s going to double. And so that’s going to impact all of us. And so that’s where I think in the floral space, which is still made up of a lot of smaller growers as well, a little bit more fracturing between grower versus importer or versus distributor. If you’re a wholesaler. In the floral space, there’s a lot of room for integration, a lot of room for people to deploy automation and deploy AI at their work.

0:33:31 Joe: But I think there’s going to be a lot of disruption.

0:33:34 Vonnie: I think maybe we should do a series. Joe Don, there are so many other things to talk about. So I have one last question for you. So looking at the bigger picture, what excites you the most about the AI driven future and what are you worried about?

0:33:48 Joe: I love the idea. I already said I can’t wait to have a humanoid robot in my home doing all the stuff that I don’t want to do. And I have a 150-year-old home. It needs some maintenance all the time. That will be a benefit, I think. You know, when you think about the floor industry in particular, over half of U.S. consumers do not use fresh cut flowers in their lives. They don’t even live with fresh cut flowers. That’s based on checkout data. The fact is, whenever I led the flower business at H.E.B., over half of known H.E.B. consumers had never bought something from my flower department.

0:34:22 Vonnie: Wow.

0:34:23 Joe: Or half. And some of that is related to economics.

0:34:27 D: Right.

0:34:27 Joe: If you’re in the bottom 20%, you just can’t afford it. Maybe you do only for significant family events.

0:34:35 Joe: Right?

0:34:35 Joe: Weddings, funerals, maybe a quinceanera but you can’t afford them every day. And so somebody is very optimistic. And I believe we are going to unlock a lot of abundance with what’s happening. Things are going to cost a lot less. And the things we’re going to remove is, as you said earlier in this conversation, are the most tedious jobs.

0:34:56 Joe: Right.

0:34:57 Joe: Driving an 18 wheeler at night is not a fun job. Working in a frozen warehouse or a refrigerated flower warehouse is not a fun job. You can pay somebody to pay good benefits, and it’s a job we need to value. But if we could help aid them to move faster, maybe have fewer of them, but they’re able to move more productively. I know Elliot talked about an exoskeleton. All those ideas are going to reduce cost and

0:35:22 Joe: Make things more available for us every day. They’re going to be more available for us, sadly, than other societies. We’ve got to be thinking about that. So that’s when we talk about the other side.

0:35:33 Joe: Right.

0:35:33 Joe: The biggest fears I have for the floral industry in particular. I grew up on a family farm, and my dad and my uncles all grew up in agriculture, like many Americans.

0:35:45 Joe: Right.

0:35:46 Joe: My mom’s side of the family still have all their land, but my dad lost the family farm. Him and my uncle and my grandfather broke out. It was part of the Xit ranch. It was pasture land. And dad and my uncle and my grandfather drilled seven wells, created the water pipes underground to do flood irrigation, and created a farm. In the late 70s, when things turned badly for American agriculture, some of the things that are in the wind right now, if you think about what’s happening in the soybean world today, he took out some loans at very high interest rates from the sba, from the government, and he wasn’t able to stay with the times.

0:36:26 Joe: So I do think most of the folks that are immersed in this are grappling with the fact that the next 10 years are going to be pretty disruptive. And I worry about people that like farmers. This is their livelihood. I have a dear friend in the industry, has moved into a new role, but he was one of the. He created a really strong nationwide. He was a grower in the floor culture world. And they had a farm sale last year, literally shut down, sold off.

0:36:57 Joe: A lot of things happened there, but he had to go through that and grow through that as a person. And I think we’re going to have some disruptions like that. And so I really just. I’m trying to proselytize and evangelize and try to help as any way I can to get people to really focus. If I was 20 years younger than I am now and a leader in a retailer the way I was 20 years ago, my suggestion would be to have very broad open eyes to what’s happening and to be very focused on helping bring that your knowledge as a leader to every single partner, employee, worker, associate that works with you to help them embrace this technology in their personal lives because it’ll help make them more effective in their home life, but help them understand and focus on how do we quickly enable ourselves to be better using these technologies and then how do we as organizations and companies create small groups to do the same so that the organizations that I love and the growers that I love will be able to continue to do what they love to do for as many people as they can employ with great jobs providing the things that, you know, that we all love in our lives.

0:38:12 Vonnie: Great. Well, thank you. I really appreciate your time. It was great talking to you and your wisdom. Great to talk to someone that is not to say we’re old, but to have a long view of like where we came from and then how fast we’re moving now, but able to understand kind of, you know, what the past has been like. So I really appreciate that perspective from you. Thank you.

0:38:34 Joe: Thank you to you and the association. I know you’ve had eight before me. I’ve watched all of them. I’m working for folks like you. You know, associations are important. So I appreciate what the IPA does to educate all of us and keep us all together having these conversations convenient to talk about. So we’re all better. So thank you for what you’re doing personally and what the IFPA is doing as well for, you know, for the produce in the Florida industries.

0:39:00 Vonnie: Great. Thanks.

0:39:03 Intro Speaker: Thanks for tuning in to Fresh Takes on Tech, hosted by Vonnie Estes. If you enjoyed the conversation, please subscribe, rate and share it with your network. You can find more episodes and resources at freshproduce.com See you next time for another Fresh take.