Losses in Grocery Retail & Losses in Food Service Questions

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  • Read pages 21, 22 & 24 from the "Wasted" article. Click here for a printable copy of the article.Preview the document 
  • As you’re reading the article, list at least one important fact that you learn for each of these eleven categories:
  • LOSSES IN GROCERY RETAIL 
  • 1. Amount Wasted at Stores
  • 2. Types and Amounts of Perishables Lost
  • 3. Amount of Revenue Lost in Stores
  • 4. How Overstocking Contributes to Food Waste
  • 5. Examples of Ready-made Food Waste
  • 6. How Expired Date Labels Contribute to Food Waste
  • 7. How Packaging Problems Contribute to Food Waste
  • LOSSES IN FOOD SERVICE 
  • 8. Amount of Food Wasted in Food Service
  • 9. Examples of Pre-Consumer Waste (waste that occurs before it has been served to the customers.)
  • 10. Examples of Post-Consumer Waste (waste that occurs after it has been served to the customers)
  • 11. Statistics about Portion Sizes and How They Contribute to Food Waste

ARTICLE

“Wasted: How America is Losing up to 40 Percent of Its Food Supply from Farm to Fork to Landfill” (pages 21, 22 & 24)

by Dana Gunders with Jonathan Bloom (and significant contributions from JoAnne Berkenkamp, Darby Hoover, Andrea Spacht, and Marie Mourad)

LOSSES IN GROCERY RETAIL (pages 21 & 22)

In 2010, the USDA estimated in-store food losses at 43 billion pounds, equivalent to 10 percent of the total retail food supply. ReFED’s estimate is much lower, at 16 billion pounds. Either way, though, it’s a lot of food.

Perishables—baked goods, produce, meat, seafood, and, increasingly, ready-made foods—represent most of the waste in retail operations. According to the USDA’s analysis of retail losses in 2011 and 2012, produce alone accounts for $15.4 billion in losses annually. Loss rates averaged 12.3 percent for fruit and 11.6 percent for vegetables. That’s enough fruit to meet the government dietary guidelines for more than 5.3 million people and enough vegetables for nearly 3.9 million people every day of the year. Losses vary widely by produce type. For instance, the rate was only 2 percent for sweet corn and 4 percent for bananas versus 43 percent for papayas and 63 percent for turnip greens.

The USDA also reports that approximately 2.7 billion pounds of meat, poultry, and seafood are wasted each year at retail, along with nearly 9.3 billion pounds of dairy products. This is enough to meet the dietary guidelines for more than 2.3 million people for meat, poultry, and seafood and nearly 18 million people for dairy.

A survey of supermarket business leaders estimated that 10 percent of revenue is lost to spoilage, age dating, package damage, and markdowns, and that large national chains lose closer to 15 percent of revenue. In a separate study, the industry group Food Waste Reduction Alliance (FWRA) estimated retail-level food waste at 0.01 pound per dollar of company revenue—so a retailer with $1 billion in revenues typically produces 10 million pounds of food waste. Tesco reported levels of waste under 1 percent for almost all retail commodities.

Part of the allure of supermarkets is that they carry a vast array of products at every hour of the day—usually between 15,000 and 60,000 items. While convenient, this bounty presents a challenge for forecasting and inventory management and inevitably leads to waste. Some level of loss is simply considered a part of doing business. Industry executives and managers view a certain level of waste as a sign that a store is meeting quality control and full-shelf standards, meaning that blemished items are removed and shelves are fully stocked. According to a former president of Trader Joe’s, “The reality as a regional grocery manager is, if you see a store that has really low waste in its perishables, you are worried. If a store has low waste numbers, it can be a sign that they aren’t fully in stock and that the customer experience is suffering.”

page 21

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Furthermore, many retail stores operate under the assumption that customers buy more from brimming, fully stocked displays. This leads to overstocking and over-handling by both staff and customers and damages items on the bottom with the accumulated weight.

Overstocked displays are a problem in store delis and seafood cases as well as in produce sections. By one account, 26 percent of whole fish are not sold, yet, they are steadily stocked because stores like how they look in display cases. A survey of supermarket business leaders estimated that 10 percent of revenue is lost to spoilage, age dating, package damage, and markdowns, and that large national chains lose closer to 15 percent of revenue.

Stores are also increasingly offering ready-made food in their delicatessens and buffets. These items make up a significant portion of food lost at supermarkets and convenience stores. If these items are made on-site, they may be able to incorporate marginally damaged or nearly expired products. However, many of these products are made off-site or by outside vendors. As with produce, store managers often feel compelled to ensure these displays remain fresh and fully stocked. Rotisserie chickens, for instance, might be thrown away and replaced after four hours on display. One grocer estimated that his store threw away a full 50 percent of its rotisserie chickens, including many from the last batch of the day.

Retailers also typically discard products two to three days before the dates on their packages. Almost all of this food is still consumable but may have a limited remaining shelf life. In most states, it is not illegal to sell products after the date on the package, but stores don’t do so out of concern that their customers will be turned off. High consumer expectations about produce freshness also lead grocers to discard any items that appear to be past their peak.

Packaging methods can also be a factor in waste levels. For instance, fresh beef placed on a disposable tray and covered in plastic wrap will take on a brown coloring much faster than beef in vacuum packing, which reduces oxygen inside the package. Although the quality of the meat is unaffected, its appearance will typically lead retailers to pull the product from the shelf. Packaging can also protect items, such as produce that is easily damaged from over-handling in the store, and extend shelf life through modified exposure to oxygen and moisture. Although additional packaging can help reduce wasted food and avoid the environmental impacts associated with wasting that food, there are still environmental impacts resulting from that additional packaging.

page 22

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LOSSES IN FOOD SERVICE (page 24)

U.S. restaurants (including full-service and quick-serve) are estimated to generate 22 billion to 33 billion pounds of food waste each year. Institutions—including universities, schools, hotels, health care facilities, and other locations with cafeterias or catering—generate an additional 7 billion to 11 billion pounds per year. Together, these outlets generate approximately two to four times the waste of grocery stores, retail supercenters, and wholesale distributors combined. One industry survey found that only 2 percent of the food discarded by responding national restaurant chains was donated.

The USDA does not explicitly estimate waste from the food service sector. This sector is, instead, lumped together with households in the “consumer” category, where combined losses were estimated at 90 billion pounds in 2010, or 21 percent of the total U.S. food supply.

Waste in restaurants and other food service can occur either in the kitchen (“pre-consumer”) or after food is served (“post-consumer”). Approximately 4 to 10 percent of food purchased by food service becomes pre-consumer waste. Common causes for pre-consumer waste include overproduction, trim waste, mishandling (e.g., overcooking or holding at the wrong temperature), or printed date labels (as with premade sandwiches or prepared salads).

Extensive menu choices also hinder proper inventory management since large menus require more ingredients on hand. Unpredictable sales fluctuations also make planning difficult. All-you-can-eat and buffet-style restaurants tend to have higher levels of pre-consumer waste than full-service restaurants, where food is largely made to order and overproduction can be more readily avoided. Centralized chain-restaurant management can also make it harder to control waste because, despite advanced inventory software, individual restaurants often lack flexibility to use food creatively. In addition, quick-serve restaurants must often adhere to strict time limits for prepared items. For example, McDonald’s has a policy that fries must be thrown out after 7 minutes and burgers after 20 minutes.

While data are limited and figures can vary widely depending on the circumstances, post-consumer waste often makes up the vast majority of overall food losses in certain restaurant settings, especially those where there is little on-site food preparation and therefore not much kitchen waste. Post-consumer waste can be caused by excessive portion sizes and service methods such as all-you-can-eat buffets and free drink refills, as well as the inclusion of bread, side dishes, and other items that consumers may not want.

Portion sizes have increased significantly over the past 30 years. From 1982 to 2002, the average pizza slice grew by 70 percent in calories, the average chicken Caesar salad doubled in calories, and the average chocolate chip cookie quadrupled. Today, portion sizes can be two to eight times larger than USDA or FDA standard serving sizes. This phenomenon is negatively affecting both how much we consume and how much goes uneaten. Of course, if restaurant patrons don’t finish their portions, they can take them home. On average, diners leave 17 percent of meals uneaten, but 55 percent of these leftovers stay on the table.

page 24 

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