Food waste: a pressing global responsibility and a business opportunity

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Efforts to prevent food loss and waste actually represent a lucrative opportunity for business innovation. Technology holds the key to doing so.

Our failure to manage food resources efficiently exacerbates several fundamental problems facing the world today and, left unchecked, represents significant lost opportunities for retailers. While nearly one billion people worldwide go hungry every day, up to half of all the food produced is lost or wasted along production chains. It quite literally goes up in greenhouse gas-emitting smoke.

According to new research from Capgemini, Smart Reduction of Consumer Food Waste: Using technology for the benefit of retailers and consumers, consumers cause the lion’s share of this waste, with households in developed countries responsible for up to 47% of their country’s waste. Yet much of it is easily avoidable. In fact, efforts to prevent food loss and waste actually represent a lucrative opportunity for business innovation and growth—and technology holds the key to doing so.

However counterintuitive it may initially seem, there are several salient reasons for retailers to discourage consumer waste. First of all, consumers who waste less save more, and those savings can be redirected to high-quality food products with better profit margins or to trying new products. Secondly, by adopting a digital technology approach, retailers can shape consumer behavior and contribute to profitable business outcomes.

With such an approach, retailers can, for example, encourage non-wasteful behavior, measure food waste, dynamically match demand and supply, and make avoiding food waste the path of least resistance. Finally, collaboration between companies across different industries could bring about innovative and business-minded approaches to reducing food waste. In effect, the direct benefits that retailers can expect to reap from reducing food waste are:

  • Avoiding costs of buying food (as ingredients or directly for sale) that was lost or wasted without being sold
  • Increasing the share of food purchased or prepared that is sold to customers
  • Reducing food management costs (including labor) and tipping or disposal fees
  • Uncovering other modes of reducing input costs or increasing output sales
  • Becoming a leader for social responsibility

Retailers are well-poised to play an active role in reducing consumer food waste, but in order to do so, they have to understand why consumers discard food, help them understand how much food they are wasting at home, and help them build a tailored strategy to reduce waste. In addition, retailers should offer consumers transparent information on their production processes and make product information easy to understand. In easing the customer’s journey to reducing food waste, retailers can also cement customer loyalty. Customers these days expect more than a simple linear relationship with retailers. Instead, they increasingly tend to seek out and support retailers whose values reflect their own.

Reducing food wastage is perceived as a social good that can also save consumers money. By highlighting the environmental and sustainability considerations, such as greenhouse gas reduction or water conservation, and by employing food waste reduction strategies that re-direct food to those who need it—via food banks, for example—retailers can expect to take advantage of the collateral benefits that reducing or eliminating food waste entails.

The amount of food wastage globally is alarming, yet avoidable. Retailers can, should, and, indeed, must play their part in reducing it, especially since doing so yields them very tangible benefits—both business and social. Luckily, technology is evolving a break-neck speed to help in this. To find out more about our latest research on the subject and to learn how Capgemini can help you help your customer reduce food waste, I encourage you to read Smart Reduction of Consumer Food Waste: Using technology for the benefit of retailers and consumers today

 

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