By Dr Marcus Gover, CEO WRAP
These are lean times for the restaurant industry.
According to a recent study by accountants Price Bailey, the number of restaurant insolvencies has reached a record high, with an average of four closing every day. A range of factors, they say, including market saturation, rising costs and changing consumer spending habits, are all combining to put pressure on the sector.
Which is why the release of our latest report, The Business Case for Reducing Food Loss and Waste: Restaurants, could not be more timely.
In a first-of-its-kind analysis, which we conducted with the World Resources Institute (WRI) for the Champions 12.3 coalition, we looked over 100 restaurants in 12 countries. These ranged from independent cafes to those with turnovers running into the millions, and examined the savings they all made from reducing kitchen food waste.
And the results should whet any restaurateur’s appetite.
We found that for every $1 restaurants invested to cut down on food waste, they saved on average $7 in operating costs over a three-year period. That’s a 600% return on investment.
The financial benefits came from a range of things such as reduced expenses from saving money on the food they buy, extra sales from using food which would have been thrown away during preparation in other meals, and lower waste management costs.
What’s more, on average restaurants achieved a 26% reduction in food waste in just one year – which leapt up to nearly 90% within two years. And all sites were able to keep their total investment in food reduction below $20,000 over the three year period.
The results echo findings from other work we have done over the last year looking at the food and drinks industry. The previous two reports focused on the hotel and catering sectors. A compelling and consistent story has emerged – impressive returns from simple and relatively cheap measures to tackle food waste, whether that’s in the hotel, catering, or restaurant sector.
Together they build a powerful counter-argument to what we sometimes hear from businesses that food waste has to be accepted as ‘the cost of doing business’ or not considered worth the investment.
So how did the restaurants achieve such impressive results?
Through straightforward measures like conducting food waste inventories, training staff on new food handling and storage procedures, and redesigning menus.
A key approach, we found, was actively engaging staff. It emerged that many staff really want to help prevent food waste but need clear guidance and support from managers about how to do it.
The recipe for success can be summed up in the simple approach we advocate for all businesses in the fight against food waste: target – the setting of which sets ambition and motivates action; measure food wasted – without which you can’t manage to reduce food thrown away; and act, which is ultimately what matters. Together they are guaranteed to deliver the huge savings we have seen across the sector.
Take the example of worldwide brand IKEA, which features in the report. Everyone must have taken a pit-stop in one of their restaurants while shopping for that bookcase. In fact, around 680 million people do just that every year in their 400 plus food outlets.
Through their “Food is Precious” initiative, IKEA has set a target to reduce its food waste by 50% by 2020. And since 2016, they have prevented more than 1.4 million kilos of food being wasted. That’s incredible. As Michael La Cour, MD of IKEA Food Services AB says: “We view fighting food waste not only as an opportunity to create a better world, but also a great business opportunity.”
This double dividend is important to stress.
Because reducing food waste not only boosts profits, it also helps to protect the planet.
This is because globally, food loss and waste is responsible for around $940 billion in economic losses every year. It is responsible for an estimated 8% of annual greenhouse gas emissions; if it were a country it would be the third largest emitter after China and the United States.
There is an emerging consensus that we need to radically change our global food system if we are to halt potentially catastrophic global warming. It was a topic which dominated, for instance, the recent World Economic Forum at Davos. We won’t be able to do this if we don’t tackle food waste.
It is a message which is being heard by governments, by business, and increasingly by citizens. It needs to be followed up with action, at scale, if we are to meet the UN global target to halve food loss and waste by 2030 enshrined in the United Nations Sustainable Development Goal 12.3.
As a Champion promoting that target, I am excited by this ground-breaking piece of work which could help accelerate progress towards that collective goal which we have all committed to.
We know that restaurants have a lot on their plate at the moment. We’ve shown how huge financial savings can be achieved in restaurants simply and relatively quickly. It can motivate staff, and satisfy customers without compromising the quality and experience which they want to enjoy from eating out. And it is a double win; for the environment, and for the economy.
There’s an appetite for change. So join us in the fight against food waste.