Listen: dY/dX partner Nevo Hadas on Radio Helderberg

Created in partnership with Smollan, dY/dX has recently built a smart dispenser which could change the future of retail – reducing plastic usage and improving our consumption habits. Nevo Hadas, partner at dY/dX, recently spoke on Radio Helderberg to explain more. Listen to the interview below.

 

Annelia Preis:
Today we are speaking to Nevo Hadas, he is a partner at the digital transformation company dY/dX. What does dY/dX stand for?

Nevo Hadas:
dY/dX is an abbreviation for ‘dY’ over ‘dX’ which is a mathematical formula for the rate of change. It comes from differentiation – the change in Y over the change in X – which is very critical to what we do. We help companies deal with the changing world and find their way through digital transformation; helping them to create new products for customers and change their working processes. For example, now during COVID, we’ve been doing a lot of work with companies to help them master remote working.

Annelia Preis:
We won’t ever get rid of plastic completely but we can reduce our use of single-use plastics – such as encouraging people to use cloth or paper bags [as opposed to plastic ones]. What is your suggestion around reducing single-use plastics? 

Nevo Hadas:
So we started a project with a company called Smollan where we looked at the informal market – such as spaza shops – and the amount of single-use plastics that are being used there. What we noticed was that, as affordability takes a hit – so, for example, people can’t afford to buy a 20 Rand bag of rice – brands are making packaging smaller and smaller. That leads to the production of more single-use plastics. We’re also seeing that the value for customers is decreasing because they are still paying for the cost of packaging while receiving a small quantity of product.

We asked ourselves, what if we could get rid of packaging completely and allow people to buy as much as they need without any restrictions in terms of packaging size? This is taking us back to the old market process, where you can go to a market and buy according to the weight or amount of the product that you want.

Obviously today there is a bigger requirement for data and people also want to know what product they’re buying – for example, what kind of rice they’re buying. We created smart dispensers which allow the distribution companies and retailers to ship 10kgs of rice to the spaza shop; the spaza shop then has 10kgs of rice in the dispenser, and if the customer wants to buy 2 Rands worth of rice, they can come with their own container or bag, select 2 Rand on the machine and the dispenser calculates how much rice that is. We find really good uptake in informal markets.

Most recently we did a project with Nude Foods in Cape Town which is a zero-waste store – which exists in the more formal and more upmarket environment where people really understand the concept of zero-waste. So, using technology,  if, for example, you wanted to buy 100 Rands worth of nuts, you can pour into your own bag and it will show you how many nuts you are getting. Then you can go and pay!

Annelia Preis:
This makes me think of buying petrol and how you can tell the attendant how much you want according to how much you have to spend.

Nevo Hadas:
Yes, it’s exactly the same model. So, with that as an example, you don’t have to buy multiple containers of petrol, there’s just a big pump house. It’s an interesting model for retailers, the brands and the consumers because consumers can save money doing this. It increases affordability so it increases food security. They also know that they’re getting the quality of food that they paid for. Retailers often measure their store’s profitability on a per square meter basis and because you won’t really be using shelves, you’ll be using dispensers which are longer and narrower – so you’re getting more vertical value out of it – they can actually increase their yield and make more money out of less shelf and storage space. From a Brand point of view, they will be receiving all the live data; so every time someone buys something, they will know exactly what it is that the person purchased and they will be able to see the transaction volume. So the brands actually get a much better idea of how their product is doing.

Annelia Preis:
With COVID-19 now, everybody is afraid to touch things. Would this reduce that problem?

Nevo Hadas:
We have been playing with a zero-touch model where you can just put your hand in front of the machine and it will dispense. You won’t have to touch the device at all, so that is also a possibility.

Annelia Preis:
I’m sure you’ve seen the pictures in the media of what happens in our oceans and how the dolphins and whales are swallowing plastic. Hopefully, we can get rid of that!

Nevo Hadas:
Even though recycling does a lot, if you look at the challenges we face, particularly in South Africa with service delivery, recycling doesn’t help if no one is picking up and taking that plastic away. We have to think of creative ways to eliminate plastic from the system because we are just creating more plastic as we go. Recycling is not going to fix that problem. The only way to keep our oceans clean is to eliminate plastic packaging completely rather than trying to make it more refinable.

Annelia Preis:
There’s a lot of plastic going into our landfills. How long does it take to decompose?

Nevo Hadas:
If you look at most of the studies, it can take hundreds of years to decompose. It’s not a viable solution. Which is why a lot of people are looking at compostable plastics, but even that takes about fifty years or so to break down, so it’s not a quick process. Those plastics also become very expensive to produce, which means it still has a big [carbon] footprint. We’ve built so much of our retail models and thinking around packaging; it’s how the things are shipped and sold – the entire system is based around packaging. If you can ask yourself why packaging exists like this and get your head out of that mode, then you can start seeing that there’s a world where you can eliminate this plastic problem completely.

I’m a big believer that this is going to be a key part of the future of retail – that we will move to a world where we are only consuming what we need and we are consuming in smaller quantities. There are benefits for the entire value chain in moving towards a package-free solution.