A Look Back at OSI Group’s Advances in Sustainability
The first meat substitutes made for vegetarians were unsuccessful in imitating the flavor and mouthfeel of beef. However, that began to change in 2011 when former Stanford biochemistry professor Dr. Patrick O. Brown founded Impossible Foods, a company that went on to produce a sustainable, plant-based burger that accurately mimics beef, including the taste, texture, and color.
The Impossible Burger 2.0, introduced in early 2019, is an improvement over the original product launched three years earlier, and it has gained the attention of major restaurateurs like David Myers, Wolfgang Puck and Gordon Ramsay. The growing popularity of the improved Impossible Burger is also affecting the meat industry, as it’s now available in more than 15,000 restaurants and grocery stores. Impossible Foods partnered with global food provider OSI Group in 2019 to further increase the manufacturing capacity for the company’s flagship product.
Heme is the key ingredient in the Impossible Burger and the reason for its success over earlier attempts to imitate meat with plant-based food ingredients. Heme is a molecule found in both plants and animals that gives meat its distinctive color and flavor. Impossible Foods extracts heme from the roots of soybean plants and adds it to genetically engineered yeast, which also produces heme when it ferments.
The rapid success of the Impossible Burger resulted in orders from restaurants and other retail outlets that Impossible Foods was unable to meet. Keeping up with this demand required the company to place office workers on the factory line for 12-hour shifts, although this still wasn’t enough to meet the high demand. Impossible Foods hired former Motorola executive Dennis Woodside as president in March 2019 to oversee the company’s expansion. Woodside initially wanted to expand without a partner, but demand was too great and time was too short for this option. Impossible Foods formed a partnership in July 2019 with OSI Group, which is one of the world’s largest food producers.
OSI Group got its start in 1909 when Otto Kolschowsky opened a meat market in Oak Park, Illinois. He expanded into wholesale meats in 1917 and moved the business to Maywood, a nearby Chicago suburb. The business was renamed Otto & Sons in 1928 and continued to establish its reputation as a provider of quality meats over the next three decades. Company leaders Harold and Gerry Kolschowsky, along with Sheldon Lavin, were primarily responsible for the company’s expansion during this period.
Otto & Sons was the beef supplier for McDonald’s when Ray Kroc opened his first location in 1955. The introduction of cryogenic food processing in the late 1960s greatly increased the popularity of fast food restaurants like McDonald’s, allowing the chain to expand quickly. Otto & Sons then became one of four original meat suppliers for the McDonald’s franchise, although a fifth one was added later.
With the financial help of Sheldon Lavin, Otto & Sons built its first high-volume meat plant dedicated to McDonald’s in 1973, which used liquid nitrogen freezing tunnels and specialized patty-forming machines. The company then formed a separate division called Glenmark to handle business for customers other than McDonald’s. Otto & Sons changed its name to OSI industries in 1975, and sold Glenmark to Best Chicago Meat Co. in 2011.
The partnership with OSI Group allowed Impossible Foods to expand more quickly than it would have been able to do on its own. OSI has over 65 facilities in 18 countries, with more than 65 years of experience supplying meat and other products to McDonald’s and other leading brands. This ability to produce and distribute food allows Impossible Foods to focus on conducting research and developing new products.
Mirae Asset Global Investments, an investment firm based in South Korea, is also interested in the Impossible Burger. This firm and other investors like Horizons Ventures, Khosla Ventures and Temasek recently invested $500 million in Impossible Foods, bringing its total funding to about $1.3 billion. Celebrities like Jay-Z, Katy Perry and Serena Williams have also invested heavily in Impossible Foods. This money is primarily earmarked for conducting research on substitutes for chicken and fish.
Gaining Market Share
Plant-based meat substitutes currently account for two percent of the total meat market. Up to 80 percent of meat manufacturers already include some type of meat substitute among their products, due to the rapidly growing flexitarian market as well the vegetarian and vegan consumer bases. Dr. Brown announced in 2020 that he intends for Impossible Foods to replace the meat industry by 2035. This goal seems unlikely, although it’s highly probable that Impossible Foods will gain a larger share of the market over the next 15 years, along with its main competitor, Beyond Meat.
Impossible Foods promotes its products as being sustainable, which aligns with OSI Group’s own goals regarding food production. For example, vegetarian meat products have a smaller carbon footprint than traditional beef. Impossible Foods claims that an Impossible Burger requires 87 percent less water and 96 percent less land than a hamburger made of ground beef from cows, while producing 89 percent less greenhouse gas emissions. This sustainability is a driving factor for sales of the Impossible Burger.
The Food and Drug Administration (FDA) has labeled the ingredients used in the Impossible Burger as Generally Recognized As Safe (GRAS), which opens the door for additional meatless products. Impossible Foods is developing products like Impossible Pork and Impossible Sausage that are already available in grocery stores and restaurants or will be soon. A pork substitute has the potential to be particularly lucrative, as swine flu and other diseases have decimated the pork industry in China. This situation has significantly increased pork prices, making Impossible Pork a viable alternative to real pork.
Impossible Foods and OSI Group are both betting that the environmental benefits of the Impossible Burger will appeal to consumers. Impossible products may become as common as traditional beef and pork as the global popularity of plant-based meat substitutes continues to increase.