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A box shows examples of the produce that is delivered to customers at the Imperfect Produce warehouse in Pennsauken, N.J. The company sells packages of surplus produce that do not meet the aesthetic standards required by grocery stores.

PHILADELPHIA — Ben Simon takes the gnarled carrots, undersized peaches and scarred peppers, all those grocery-store rejects, and he finds them a home. He wants those fruits and vegetables to become carrot cake, peach pie, stir-fry for a family dinner.

Flawed fruits and vegetables taste the same as the produce found on supermarket shelves, said Simon, co-founder of the Imperfect Produce company, which was recently launched in Philadelphia. And when ordered through companies such as Simon’s, they often cost less.

“The average customer doesn’t care about how it looks nearly as much as stores think they do,” Simon said. “Especially if you’re just going to chop it up, what’s the difference?”

Simon is one of a growing number of entrepreneurs who see beauty, as well as profit, in “ugly” produce — the fruits and vegetables that distributors and supermarkets say they can’t sell. As much as 40 percent of the food produced nationwide goes to waste, according to estimates by the U.S. Department of Agriculture, and founders of ugly-produce companies say their businesses provide additional income to farmers while making fresh food more accessible.

Distributors and grocery stores might reject produce when there is a surplus, or because there is too little of a product available for the store to consider the purchase worthwhile. But often, it’s for aesthetic reasons.

Dana Ward, a communications manager for Acme Supermarkets, said that’s because many customers judge produce by how it looks. Edible but flawed items that end up in stores are either cut up and used in veggie and fruit bowls, or donated to Acme’s food bank partners, she said — otherwise, they go to waste.

“Most customers are looking for blemish-free produce,” Ward said in an email. “Therefore, produce that doesn’t look as great tends to stay on the shelf.”

Abhi Ramesh, who launched produce company Misfits Market in a North Philadelphia warehouse last August, believes that education is key. Some customers might assume that surface imperfections affect the flavor of an item, he said. Others might not know that the weirder-looking the fruit or vegetable, the more likely that it was grown using natural methods, instead of being engineered to look perfect.

A graduate of Penn’s Wharton School of Business, Ramesh came up with the idea for Misfits on an apple-picking trip when he asked about the fruit he saw on the ground that was being collected and dumped into bins.

“The farmer said, ‘These are our misfit apples,’” he said. “At the same time, I knew there were huge food deserts in Philadelphia and around the state. All of this was going to waste. And there was nothing wrong with it.”

Misfits now delivers in 15 states and recently moved into a 140,000-square-foot building in Pennsauken. Ramesh said the price of Misfit boxes, which start at $19 for 10 pounds, appeals to customers with tight grocery budgets, as well as those who live in areas where finding produce year-round is a challenge.

“The majority of our customers are people who can really benefit from saving a few dollars,” he said. “A difference of $20 to $30 makes a big difference to a lot of families.”

California-based Imperfect Produce, co-founded in 2015 by Simon, Ben Chesler and Ron Clark, buys discounted produce from 200 farms across the country as well as from distribution centers, transports it to packing centers such as its warehouse in Pennsauken, and delivers to homes. Simon hopes to partner with local farms as the company becomes more established in the Philadelphia region. The company is collaborating with Weckerly’s Ice Cream in Fishtown on a flavor made with beets and orange zest sourced from Imperfect. The limited-edition flavor will launch June 26 at the 9 W. Girard Ave. shop.

“It’s been phenomenal to see people across the country jumping on board,” he said. “We really view this as a consumer movement for food waste. People love to have the chance to make an impact, and this is about putting a solution in front of people.”

Ugly-produce companies have faced criticism from environmentalists who question whether creating profitable businesses out of ugly produce might exacerbate the nation’s waste problem by encouraging the continued production of too much food. Some advocates also worry that monetizing flawed produce could hurt donations to food banks and pantries, which benefit from donations and the ability to purchase surplus food at below-cost prices.

Kait Bowdler, director of sustainability for the local food-rescue organization Philabundance, said that although donations were down last year, that was due to economic and climate factors, not the rise of ugly-produce companies.

In fact, Bowdler said, the proliferation of those start-ups can only help Philabundance’s mission, because normalizing less-than-perfect fruits and vegetables will help reduce food waste.

“We absolutely see a benefit in educating the public that ‘ugly’ produce is just as delicious,” she said in an email. “Just because an apple has spots or is getting softer doesn’t mean it needs to be thrown out — use it for a dinner or dessert recipe.”

Philabundance, which recovers about 275,000 pounds of donated products from local farmers per year, has also partnered with some of the companies: Since 2017, delivery service Hungry Harvest has donated more than 18,000 pounds of produce to Philabundance. Misfits Market, which began donating this year, has given about 2,100 pounds.

Misfits’ Remesh said some small farms that supply food to ugly-produce companies aren’t able to make large donations, which require shipping produce in temperature-controlled trucks. Those farmers might turn surplus into other products, donate to nearby organizations, and compost the rest.

Ben Wenk, co-owner of Three Springs Fruit Farm in Adams County, Pa., and a seventh-generation farmer, said that over the years he and his team have found ways to off-load as much leftover produce as possible. The farm sells less attractive fruit to breweries, chefs or restaurants for use in beer, sauces or desserts. Some crops are turned into jarred products such as applesauce, ketchup or jam.

Like Bowdler, Wenk said ugly-produce businesses have the potential to benefit farmers in more ways than just offering a place for selling leftovers.

“If these organizations are instructing people that this stuff tastes great, and doesn’t have to look like it came from a cookie-cutter or adhere to some of the marketplace standards, that’s a win,” he said.

And though Wenk acknowledged that many farm customers tend to gravitate to the nicest-looking produce, he’s hopeful that the number of people willing to take home the ugly ducklings is growing.

“There are some folks who say, if they’re all the same, I might as well take the one that looks the best,” he said. “Then there are a few people who tell me, ‘I know someone else won’t take one that looks like this, but I will.’ And I say, ‘God bless you.’”

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