31 Mar 2017 Story Resource efficiency

Want a sure bet? Invest in cutting food waste and loss

Tesco chief executive officer Dave Lewis is on a mission— and on a deadline.

Confident, earnest and three closely-watched years into his post, Lewis has committed his company to making sure that no edible food goes to waste by the end of 2017— at least wherever Tesco has control over it.

And that meant looking very closely at both their own operations and, importantly, their supply chains.

Luckily for Lewis, it seems that Tesco is ahead of its time.  

Before he joined the company, the company had begun to measure its food waste footprint from “end-to-end” (upstream to downstream), and in 2014, it published this information.

Three years later, it is still only one of two supermarket chains to publicly report its food waste figures. (Sainsbury’s released its UK-wide food waste data for the first time in September last year.)

Lewis, also the current chair of Champions 12.3 — a coalition of leaders from all sectors dedicated to mobilizing action to achieve reductions in food waste and loss— lived in developing countries in South America and Asia while working at Unilever for 27 years, and was deeply dismayed by what he encountered while getting familiar with the supermarket industry and the company’s day-to-day operations.

He pulled a late shift on the shop floor one day, and found that despite routines to reduce food waste, much still had to be discarded.  

 “I was part of a team that at the end of the day took perfectly good food and threw it away,” he said, in a Champions 12.3 address.

Since then, Tesco has inventoried its waste, figuring out the main causes and developing indicators to monitor progress. 

The company now works with young entrepreneurs to design software and apps that can help it work with charity organizations to donate unsold, safe food. It has taken on activists as advisors, sold “perfectly imperfect” wonky-looking but nonetheless high quality vegetables and fruits at a lower price, abolished “buy one get one free” promotions, and started consumer education measures.

It has also boosted collaboration with suppliers to improve forecasting, ordering and logistics, and is linking different parts of its business so that, for example, a batch of bruised potatoes could go straight to the processor to produce packaged mash potatoes.

This month, it launched a Food Waste Hotline for its network of over 5,000 suppliers so they can call the company’s project teams directly to highlight food waste hotspots and “work together to take action”.

Wasting a whole country’s income

Tesco is so confident of the hefty savings potential in reducing food waste that, according to Lewis, this contributed to its 3.7 billion pound takeover offer for wholesaler Booker, announced in January this year. 

But it’s not the only company that has come to this realization through experience.

A recent report from Champions 12.3, The Business Case for Reducing Food Loss and Waste, found that half of the 700 companies it surveyed experienced a US$14 return or greater on every dollar invested in food loss and waste reduction.

The report also revealed that global food waste causes economic losses of US$940 billion— higher than the GDPs of all but the world’s largest 16 countries.

One-third of all food produced never gets consumed, even though 1 in 9 people globally don’t get enough to eat. If it were a country, all that food would be the third-largest emitter of greenhouse gases in the world, responsible for 8 per cent of global emissions, behind only China and the United States.

The study also found that the United Kingdom saved £250 for every British pound spent on efforts to curb avoidable household waste (it was the only country the researchers could find with full financial cost-benefit data available).

Six municipalities in London found that they saved £8 in avoided management costs alone for every pound spent on an initiative to reduce household food waste. For households, the savings were a whopping £84.

Cutting food waste also means reducing the use of a whole host of resources and pollutants, including:

  • Greenhouse gas emissions from decomposing food in landfills
  • Water consumption by agriculture (which uses 70 per cent of the world’s water)
  • Land area needed for cultivation (where finite arable, fertile land must feed 9 billion people by 2050)
  • Fertilizer and pesticide applications
  • Landfill demands

“These evidence-based return-on-investment figures for action to reduce food waste make clear the business case for many more companies and governments at all levels to take the recommended steps towards meeting the official 2030 target on food waste, which can only happen if everyone pulls their weight,” said UN Environment Programme Management Officer, Food Systems and Agriculture James Lomax.

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