A smarter way to fight food waste at supermarkets

Author – Philippe Goas, European Business Development Manager, Panasonic France

Whatever way you look at it, food waste is a massive problem.

According to the UN, about 1.3 billion tonnes – a third of all food produced for human consumption – goes to waste every year. This squanders hundreds of billions of euros and has a carbon footprint of 3.3 billion tonnes of CO2 annually – in other words, if it were a nation, food waste would be the third largest CO2 emitter.

How are things in Europe, specifically? In Germany, approximately 11 million tonnes of food are tossed out annually. In the UK, figures are similarly high, with over 10 million tonnes binned post-farm. The French Agency for the Environment and Energy Management (ADEME) reports that 10 million tonnes of food are lost every year, valued at 16 billion euros.

While the lion’s share of waste in these countries comes down to consumers, it is clear that retailers must play their part in combating this issue. In the UK for example, Tesco alone discarded 59.4 thousand tonnes of food in 2016, with other supermarket chains right behind them. In France, retailers are responsible for 1.4 million tonnes of waste – about 200 tonnes, or 400,000 meals per (large) store per year. That works out to 0.9 per cent of revenue. And that is quite a chunk out of what is a wafer-thin profit margin.

So what can retailers do?

The ideal scenario is a supermarket where food is fresh, shelves are empty at the end of the day, and waste is zero. Unfortunately, the reality is very different – but there are steps retailers can take to move in this direction. One approach is swapping use-by with best-by dates. Some stores are even dropping best-by dates entirely for certain products, such as fruit and vegetables.

In particular, discounting items near their expiration date is an attractive solution. However, manual markdowns with stickers can be costly, inefficient and time-consuming.  As a result, the discount is often displayed much too late – and is likely to escape consumers’ attention. But there is a way to ensure pricing is up-to-the-minute and hard to miss: with the right technology.

Smarter labels, better pricing

Electronic shelf labels (ESLs), for example, enable dynamic pricing: the retailer can remotely change pricing on any item in a matter of moments. Moreover, with the right back-end software, discounts can be automatically applied as the expiration date nears. This lowers labour costs, and saves paper and ink. What’s more, prices are more accurate and visible for the right time period. So customers can act sooner.

As a result, more products are sold, less food is wasted, and customers enjoy lower prices – a win-win.

ESLs in action

A large supermarket chain in the Netherlands has already been experimenting with ESLs. These are especially useful for highly perishable products, so they started in the fish and poultry sections. The new system not only takes into account the expiration date – it also considers store location, current stock, sales history, ongoing promotions, and even the weather. Prices can change several times a day – as quickly as every ten minutes. The results have been positive, and other supermarket chains are taking note.

Waste not, want not

What are your own thoughts on food waste? Perhaps you have tried out these or similar technologies? Or you would like to know more about how these tools and how to implement them? Please do not hesitate to get in touch with the team – and you can check out our website to read more.