THE BLOG

The 'Broken' Supermarkets

22/11/2016 12:21

Having worked in the food industry for most of my career, I've had a front row seat to the ways in which companies sell, buy, and profit from the sale--and waste--of food. Among the litany of culprits, including us noble consumers, the worst offender in the perpetual generation of food waste (as measured by volume), is without a doubt, the supermarket. The antiquated supermarket model results in an unfathomable volume of waste, which has devastating social, environmental and economic implications - and it must stop.

Grocery is the largest category in consumer spending. It's far bigger than travel, fashion or electronics. People spend more money on food than they do on cars with the average household now devoting about 9% of its expenditure on food, which amounts to 51% of total retail sales in the UK, and the vast majority of this is spent in the supermarkets.

The inefficiency of the current supermarket model can be explained as such: Every year, supermarkets develop and sell a huge volume of food, millions of tonnes of products, that are sent to stores all over the country for customers to buy, without certainty around exactly what consumers will purchase when they walk in the store. The result? Up to 50% of perishable products are wasted. Because supermarkets don't know what customers want to cook when they enter the stores, they have to put everything on the shelves. And if the products aren't purchased, they are generally disposed of. In the UK, excess food inventory generally finds its way to one of three futures: landfills, incineration or anaerobic digestion, all of which cause varying degrees of environmental degradation. To add insult to injury, all food waste from retail is classed as 'avoidable', because it was capable of being sold.

Having co-founded two food businesses, Delivery Hero and Marley Spoon, I have spent a lot of time trying to make sense of supermarket inefficiencies. There are four key areas that lead to the preposterous amount of food wasted every year.

The first is forecasting, which I've touched on above. The current supermarket model makes forecasting extremely difficult, meaning that the average UK supermarket holds between 5,000 and 25,000 individual products at any one time. The majority of these are perishable products that last a mere three days on the shelf, so anything that isn't picked up by the customer is thrown out. The sad, and very true reality is that for every tomato eaten, another is thrown away.

Secondly, the way that supermarkets are laid out, and the strategic discounts and BOGOFs they employ to sell food, force customers to purchase 20% more food than they actually need. It's no coincidence that bypassing 'impulse products' on the way to buy the essentials is standard practice across supermarkets. The extras bought in the store result in surplus in the home kitchen: extra stalks of celery that linger in the veg drawers, coriander that goes slimy, and age-old bottles of fish sauce that become refrigerator stalwarts, are the norm in far too many households. This is much to the delight of the supermarkets, who profit by selling customers more than they could possibly need.

Thirdly, due to the sheer volume of products required to stock supermarkets' many locations -- Tesco alone has 3,500 shops across the country -- they primarily work with big agribusinesses. Food manufacturing is the UK's single largest manufacturing sector and accounts for 2.4 million tonnes of food waste each year - over half of which is avoidable. On top of this, the environmental impact of these big food businesses is devastating, 80% of fresh water consumption alone is used for agriculture.

The devastating irony is that although supermarkets' requirements lead to huge surpluses in food production, it does little to curb the very real issue of food deserts--areas where access to fresh produce is scant and residents are forced to source food from corner shops and fast food outlets. The UK, US and Europe have nearly double the amount of nutrition than required by their populations. Despite this, around 20% of people in rural areas and 25% of people in urban areas have poor access to fresh foods. Combine accessibility with the high cost of many nutritious foods and suddenly that insipid ready meal takes on a new light. The reality is that an embarrassment of riches is leaving many parts of the UK hungry and in need of better nutrition.

Direct-to-Consumer models such as meal kits, which enable people to cook without having to visit the supermarket and perpetuate the food waste generated through its model, are not only creating convenient and healthy cooking habits, but also helping to make the food industry sustainable. By changing the way we approach our food shopping we can make big changes to the effect our food industry has on the environment. The changes must come from each and every one of us.

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