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Restaurant Daily News Tuesday, May 22, 2018 7 4 The Profit Potential in Food Waste Reduction By Lorrie Baumann Consumer concern about wasted food presents grocers with an opportunity to join their customers on the right side of the conversation, according to Doug Rauch, Founder of The Daily Table and former Chief Executive Officer of Trader Joe's. "Grocery chains are sometimes accused of having a strong vested interest in consumers wasting food. We funda- mentally disagree with this view," he said. "This is an opportunity to get on the right side and get out in front of your cus- tomers." The problem of wasted food is get- ting a lot of media attention, which means that your customers have heard about the issue and many of them are concerned about it. A 2015 consumer survey found that almost half of respon- dents said they'd heard or seen some- thing about wasted food in the past year. Almost half of the 6,700 adults who were surveyed were aware that it's esti- mated that about 40 percent of the food produced in the United States is wasted. "It's not just Millennials who care about the environment and all those other val- ues. People are really relating around what they care about," Rauch said. "Thirty nine percent of Americans are 'aspirationals,' people who care about doing something good. That's the biggest proportion of the marketplace, and those people are advocates about issues like food waste. ... If we want to keep in front of our customers, we need to be thinking about that, because they're going to be asking about and requiring action on this." According to a 2017 estimate by the Natural Resources Defense Council, the dollar value of food now wasted in the U.S. is $218 billion, which is equal to 1.3 percent of the country's gross domestic product, and equivalent to 1,250 calories per person per day, about half the recommended daily intake for adults. That wasted food also accounts for 2.6 percent of all U.S. annual green- house gas emissions and about one fifth of all the agricultural water usage in the U.S., more than the agricultural water usage of Texas, California and Ohio combined. If there is a villain here, supermar- kets aren't it -- consumer households are responsible for more than three times the food waste that's produced by grocery retailers and distributors, according to ReFED, a nonprofit organization of busi- ness, nonprofit and government leaders dedicated to reducing food waste through data-driven solutions. Grocers are challenged in their efforts to reduce food waste by consumer demand for a consistently wide variety of food inventory that can strain inventory management and food purchasing. "When you're dealing with an issue like wasted food, it's important to talk about culture and what you stand for. Any strategies are going to run right up against culture. You've got to get in front of this by stepping back and thinking about cul- ture," Rauch said. "Culture starts with leadership. People are going to look to you." If you're known for offering the economy sizes that reduce packaging waste, you'll have a harder time avoiding the suspicion that you're encouraging consumers to buy more food than they can use. And of course, consumer demand for freshness and sensitivity to aesthetic values can lead you to discard produce as soon as it's past its peak out of concern for your shoppers' experience. Reducing food waste offers you the opportunity to boost revenues by marketing discounted imperfect pro- duce. "Imperfect produce is a great opportunity for retailers. As soon as you call something 'heirloom,' people will pay more for it even if it looks weird," Rauch said. "We can't let per- fect be the enemy of the good. We've got to find ways to take this food that's cosmetically blemished but healthy and figure out how to feed the one in seven who are food insecure or how to use it to give our customers a better value." You can give customers a bargain and eliminate some of their need to dis- pose of aging product by expanding pro- grams to discount items nearing the end of their shelf life and by allowing pre- pared foods to run out close to closing. Use signs to explain to customers that allowing items to run out helps curtail food waste. In the produce department and in seafood and meat cases, platforms and other props can help make displays appear fuller without utilizing as much product. Improved inventory management systems can also help. Mining your data can help analyze item performance to help identify opportunities to eliminate items as well as improve forecasting. On a macro scale, you can place greater reliance on products packaged to prevent spoilage, and you can collaborate with manufacturers to improve date labeling on products and to educate consumers about the meaning of the dates they see on package labels. Many grocers are already leading the way by finding ways to encourage consumers to buy cosmetically imper- fect fruit and vegetables. The Natural Resources Defense Council, in its 2012 update to its 2012 report that started the national discussion, "Wasted: How America is Losing up to 40 Percent of its food from Farm to Fork to Landfill," points to French retailer Intermarche's periodic promotion called "Inglorious Fruits and Vegetables" in which it offers prepared foods such as soups and yogurts made from lower-grade produce and sells fresh misshapen fruit and veg- etables for a 30 percent discount. The initial rollout in 2014 saw sales of 1.2 tons per store and a 24 percent increase in overall store traffic in the first two days, according to the retailer. "Wasted" reports that Hy-Vee, Hannaford, Giant Eagle, Whole Foods and Walmart are among those rolling out full or pilot pro- grams in the U.S. Other efforts to reduce food waste are being greeted enthusiastically by consumers, as evidenced by the 83,000 followers for a Twitter site called @ugly fruitandveg, which posts pictures of oddly shaped produce and United Kingdom startup Oddbox, which deliv- ers boxes of misshapen produce to London customers. In the U.S. Imperfect Produce sells boxes of misshapen pro- duce directly to consumers, attracting more than 7,000 customers in its first year after launching in July 2015, according to the company's Chief Executive Officer. Hungry Harvest has a similar business model for "rescued pro- duce" in Washington, D.C. Jody Levy and Harlan Berger are among those who've found a profit in rescuing produce that would otherwise be discarded in the field. They're the co- Founders of WTRMLN WTR, which produces cold-pressed watermelon juice and markets it as an outstanding hydra- tion product that also reduces food waste. At the time they founded the company in 2013, Berger and Levy sourced only res- cued fruit to make Original WTRMLN WTR. With the growth the company has seen, the company now sources other fruit from its nationwide network of growers, but, still, 60 percent of the fruit that's used to make a line that now includes four other varieties would be otherwise discarded. "We take many mel- ons from growers around the country. There are times when farmers don't get the rains they're expecting, and so they have tons of watermelons they can't sell because they're sunburned. These are perfectly good watermelons, and we take them and cold-press them to obtain the water in four facilities around the coun- try," Levy said. "We use everything but the skin." Levy herself is an example of the kind of consumers who seek her products and who connect with businesses who lead the way on the issues they care about. "I personally believe that every business is like an organism and every person connected to and invests in that business is part of the whole. That applies to the consumers as well," she said. "Consumers support our brand because they love our product, and they trust our product. They know we care, and they trust us because it aligns with what's important to them." Teabag Sachet Line from Art of Tea Art of Tea recently launched its fresh line of individually wrapped Eco Pyramid Teabag sachets, completing the compa- ny's rebranding efforts. The sachets, which are available in both bulk cases and retail-ready packaging, now feature the same striking patterns as the company's Artisan Tea Tins and Glass Canisters. Now cafes, restaurants, and other hospi- tality spaces can provide both a loose-leaf tea program and a single-serve tea experi- ence with one consistently beautiful aes- thetic. For more information, contact Art of Tea at 877.268.8327 or go to www.artoftea.com.