In 2007 a nationwide initiative to reduce the household food waste was launched in the UK. The financial benefits’ ratio compared to this initiative’s costs was 250:1.
Simply put, for every £1 invested resulted in savings of £250. So why isn’t the food industry applying this approach to their business strategies?
Over the past 11 years, the government has been working to reduce the 7 million tonnes of annual food waste, through a series of voluntary agreements that have reduced per capita food waste by 14%.
Michael Gove recently announced that the government are aiming to decrease food waste by an additional 20% through a £15 million investment that will work alongside The Courtauld Commitment 2025 initiative, helping the UK achieve UN Sustainable Development Goal 12.
Change is afoot but are UK businesses prepared?
Biffa asked some of its customers in the food industry including caterers, restaurants, and hotels about their waste management.
83% thought waste management was important…
…but only a few had effective processes in place to manage their waste with lack of resources, time and costs being the most significant challenges faced.
Before we go any further, let’s answer a few questions.
What is food waste?
Food waste can consist of both food that is intended for human consumption and inedible components, such as rinds, bones, and pits that come out of the food supply chain somewhere in between leaving the farm and getting to our forks.
How much food is being wasted?
Food waste costs the commercial industry an estimated £4.35 billion each year. In terms of personal loss, an amount of that size can be difficult to put into perspective.
If we focus on just the hospitality and food sector which produces an average of £2.5 billion worth of food waste each year, spread across the 202,000 accommodation and food businesses registered in the UK in 2017 – that amounts to an annual estimated average cost of£12,376.24 worth of food waste for each business. Since 99.9% of companies in the UK are SMEs, this figure is alarmingly high.
Besides the concerning impact the food waste has on the economy, the environmental impact should also be taken into consideration. It’s estimated that UK food waste is associated with over 20 million tonnes of greenhouse gas emissions. 20 million tonnes of CO₂ emissions equals more than half of London homes’ energy usage for a year.
Why is so much food wasted?
Many factors play a role in why food gets wasted along the farm to fork food chain. The main culprits during the post-harvest, storage and manufacturing stages are inadequate storage or protection resulting in food becoming spoiled and inedible.
By the time we get to the retail and consumer stage, the reasons behind food waste become more familiar, such as excess surplus and plate scrapings.
Did you know…? If you run a restaurant, for every six meals your business makes, one of those meals goes straight into the bin.
How can you use this information to benefit your business?
Financial benefits for tackling the food waste crisis
The simple financial benefits of reducing food waste for the food industry is that if more produce is reaching its final destination – the consumer’s fork – then the more profit a business can accumulate.
It makes sense, if a bakery produces 100 loaves of bread but only sells 80 then 20 are not reaching the end of the food chain and will not make any financial gains for the bakery, who still have to incur the costs of producing the bread as well as the additional fees for disposing of it.
Taking the necessary steps to reduce food waste does require initial financial costs such as consultants, new equipment, process redesigns and awareness campaigns, however…
Do the overall economic benefits outweigh the upfront costs?
On average, yes!
A study conducted by WRAP showed that 99% of companies, representing different sectors including grocery stores, restaurants and hotels, had a net positive financial return after investing in food waste management
The median benefit-cost ratio was 14:1, meaning that for every £1 spent on food waste management the average company saw a return of £14 (1300% ROI).
How improving the environment can enhance your business
Did you know…? 50% of consumers have avoided a product based on a company’s responsible reputation.
That’s a lot of potential custom a business could be missing out on due to their environmental status. Investing in an environmentally friendly operation could increase your customer base and overall profits.
How is Biffa tackling food waste?
Biffa understands that not all food waste is unavoidable, but we can take measures to reduce the economic and environmental effects of food waste, through the ‘Food for Fuel’ campaign. The campaign encourages businesses to separate food waste from general waste and will support the Government’s £15 million investment to tackle food waste. The new scheme will launch in 2019/20.
By diverting food from landfill to one of our anaerobic digestion (AD) facilities, our customers can reduce their waste management costs, and the food waste is then repurposed into renewable energy, powering homes and businesses.
A great working example of this is Sainsbury’s superstore at Cannock, which is powered by its own food waste via a 1.5km cabled connected to our AD plant nearby.