Farmhopper, an EIT Digital-supported innovation, will allow environmentally conscious consumers to get easy access to fresh groceries, while enabling farmers to build their reputation, showcase and sell their products to a wider public.
“In Hungary there are many local markets where you can buy fresh food; however, they don’t scale, because customers need to know their exact location, and they don’t have a catalogue of what’s on sale,” says Ágnes Bányai, project manager at activity leader E-Group, cited in a press release sent to the Budapest Business Journal. “Many of them are also open only one day or a few days a week, which is also part of the problem.”
Farmhopper, which will be accessible both as a website and a mobile application, aims to overcome these hurdles by building a software platform which takes care of all the processes related to the agricultural value chain (onboarding, creating and maintaining marketplaces, order management, payments and billing).
Acting as a “digital middle layer,” the platform will provide customers with all the necessary logistical information and also contain a catalogue of products on sale. Consumers will be able to select their favorite groceries and place orders using a secure credit card payment solution provided by leading lender OTP Bank.
The initiative started in September 2018 as an “early bird” activity, with an initial focus on the Hungarian market involving E-Group as activity leader and OTP Bank as a partner.
One of the main features of the platform, distinguishing it from other websites and apps that simply aggregate fresh food offers, is the introduction of a “community host,” a person who will build the network of farmers and consumers, organize events where they can meet, and handle any potential problems, explains the press release.
“Customers will pay in advance and just pick up their order at the event. If there is a problem, for instance the quality and quantity is not right, the community host will jump in, resolve the issue, or refund the purchase,” says Bányai.
In line with the so-called “reputation economy” methodology, to make sure everything runs smoothly, farmers belonging to the Farmhopper platform will be rated by customers based on their behavior. The community host will take a cut on the financial transactions generated by the community, and the platform providers will also take a commission.
“It’s similar to a franchise method: we provide the tools, and community hosts then use their expertise and knowledge about what consumers need in their network,” Bányai explains.
The first step of the Farmhopper product implementation has been extensive market research on the appeal of agricultural online marketplaces. This revealed that in Hungary, around 800,000 of a total of 5.7 million internet users aged 18-69 could be potentially interested in trying the platform. Of these, 10% would be willing to take up the role of community host, the research found.
The first demo launch to test functionalities on a small community will happen this fall. By the end of 2019, a startup will be created to support the commercial launch of the platform. Farmhopper will be launched in Hungary first, but the consortium plans international expansion in the future, says the press release.
EIT Digital describes itself as a leading European digital innovation and entrepreneurial education organization driving Europe’s digital transformation, delivering breakthrough digital innovations to the market, and breeding entrepreneurial talent for economic growth and improved quality of life in Europe. It does this by mobilizing a pan-European ecosystem of over 200 top European corporations, SMEs, startups, universities, and research institutes.
As a Knowledge and Innovation Community of the Budapest-headquartered European Institute of Innovation and Technology, EIT Digital is focused on entrepreneurship and is at the forefront of integrating education, research and business by bringing together students, researchers, engineers, business developers and entrepreneurs, the press release adds.