Supermarket Food Waste – How Can We Minimise It ?

This blog was originally published in October of last year when the steep rises in food prices resulting from Covid and the Ukraine war were beginning to bite in earnest. We have now emerged from what was a winter of significant deprivation for some, and things are likely to get even tougher now that the various one-off  winter financial subsidies have disappeared, and much higher accommodation and other living costs are really kicking in.

The ideas and proposals outlined last October would seem equally relevant today, given that the steepest price rises of all now seem to be in the food sector. Although Jack Monroe's sterling work in early 2022 persuaded at least one supermarket to stock their complete budget price range items in all their stores, careful observation will reveal that stocks of these items are often being allowed to run out, and are eventually quietly discontinued. Unfortunately, I don't see much evidence that retailers are making any additional efforts to eliminate waste - some are actively promoting it, as you'll see if you read on. On the plus side,there are encouraging signs that consumer organisations such as Which ? are now taking up the baton (see recent report here) - lets hope HMG 'bites the bullet' and takes some action (you are strongly advised not to hold your breath, though !).

The only hope for many 'on the breadline' is cheaper food - the elimination of food waste has to be a key element of this.

Looking at our European neighbours, schemes designed to avoid food waste are widespread - our nearest neighbours in France have had a legal obligation not to dispose of any unsold food to landfill or by incineration since as far back as 2016. Food reaching its sell by date in French retail outlets must thus be sold off or given away to consumers / food banks at the end of each day to avoid heavy fines. 

Why have we been so laggardly in following suit in UK ?? Read on for more details...and some practical suggestions.

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In a previous blog, I touched briefly on some of the effects of supermarket food-pricing policies on food waste. 

In our current situation, it's likely that many of our poorest households will feel the need to continue cutting back on food shopping on cost grounds this summer and autumn.  I think it's now time to focus on what could be done by our food providers to help the worst off in our society make ends meet.

Our concerns for the environment means that it’s now, more than ever, essential for food retailers to cut down the amount of unsold food they send to landfill or incineration. Given the current cost of living crisis, in my view, they also have a moral duty to ensure that any surplus food not sold by them before its sell-by date is passed on to those who need it most – and at minimal cost.

UK government are also concerned about the environmental effects of current waste levels, and have already taken up the cause in actively encouraging the major supermarket chains to help reduce food waste. Some retailers have already introduced measures such removing multi-buy offers. The elimination of ‘Best Before’ dates from their packaging has also gained ground, but this has had little real effect. (Most of us have always been perfectly capable of deciding when an item is safe to consume without the need for a ‘Best Before’ date anyway.  These dates were always pretty meaningless in any case, and could sometimes be downright misleading, given that food deterioration is so heavily dependent on the consumer's own storage conditions post-purchase.)

As an alternative to just tinkering with product labelling, there is another and more effective way of tackling the problem, which also has real social benefits....

All food manufacturers and vendors are required to abide by Food Standards Agency regulations on sell-by dates, which are a legal requirement for public health reasons. All items that have reached their sell-by date must either be sold-off by the end of that day or disposed of to landfill or by incineration – they cannot be donated to food banks or sold on to other outlets for human consumption. That is the law.

Supermarkets have so far been left to themselves to decide how to deal with perishable items reaching their expiry dates. Most of them have a policy of reducing prices during the final day before expiry, down to a fixed percentage of the full selling price (usually a minimum of 30-40%). 

Some of the more enlightened vendors have in the past also allowed local store managers and staff discretion to reduce the prices of items to lower levels that this towards the end of each day to effectively ‘clear the shelves’. (ASDA were a good example of this under Walmart's management, but the new owners have now vetoed this scheme in favour of higher profit margins. See previous blog for more details.) 

Radical end-of day markdowns make good economic sense. Not only does it reduce food waste and thus prevent the damage to the environment through landfill seepage, and atmospheric pollution due to incinerator effluent, but it also saves the company money by avoiding  increasingly expensive landfill tax and disposal charges. Last (but certainly not least in our current economic predicament) it gives the least well-off in our society a chance to save money on their groceries, and continue to feed their families without having to resort to food banks. (These are generally means-tested and limited to those on state benefits, so will exclude many who are struggling to make ends meet on 'gig economy' subsistence wages.)

The voluntary approach to regulation taken by government so far has been at best patchy in its effectiveness. Not all supermarkets can be bothered with radical final reductions to clear their shelves (or even have the staff resource to do it), and indeed some actually prohibit it as part of their stock management policy (e.g. Tesco, ALDI). In my view, this is no longer an acceptable practice.

In the absence of the more radical ban on all unsold food disposals (as in France), as a means of providing a more ‘robust’ incentive to upgrade their pricing policies, a levy could be introduced on supermarkets, applicable to any vendor failing to implement radical end-of day down-pricing.

While we transitioned to an outright ban, I would suggest as a starting point, that all saleable items (i.e. those not damaged and still within their expiry dates) which have not been sold by the end of their sell-by date should attract a disposal charge of 10% of their full price, with a minimum charge of 25p on items priced at under £2.50. The data to identify these items should already be readily available within their stock control systems, which would be available to FSA inspectors on audit, so there would be no escaping the charges.

This would, I'm convinced,  ensure that pricing policies were quickly reviewed by the majors, and a lower price ‘floor’ applied to make sure that shelves were cleared effectively by the end of each day. I can confirm from personal experience that this approach when it was practised, actually worked, with items quickly disappearing post-final reduction. 

A quick look at a supermarket's existing stock control systems’ records on the number and prices of items sent for disposal in the previous month should be all that was necessary to convince most supermarket managers of the need to adapt – or face much higher disposal costs.

If government are really serious about reducing food waste, they should consider allowing FSA to give the majors the option of either implementing more realistic pricing policies now, or facing a new levy of the sort I’ve described. I’m convinced retailers would quickly comply if presented with these alternatives.

What about the economics of this for the retailers ? Looking at the costs of landfill / incinerator disposal vs selling, even at radically reduced prices, it’s obvious that the latter makes much more sense financially for food retailers. The cost of commercial landfill is now approx. £200 per metric tonne (1000kg). A 4-pint carton of milk, for example, weighing ca 2kg would normally attract a landfill disposal charge of at least 40p. Even without an additional 'deterrent' levy, selling this item instead for as little as 20p would still put the supermarket 60p ahead of the game (even more than that if the staff costs of collecting the item and managing its disposal are taken into account). It would actually even be cheaper for them to give it away !

On the minus side, a new disposal levy could, however, reduce the amount of available food on the shelves for financially-stressed shop customers, by encouraging supermarket managers to divert all their stocks of short-date products to our overworked and already  oversubscribed food banks in advance of their expiry dates to avoid the charges. 

Is this likely to happen? - I suspect not, since supermarkets are too fond of maintaining their profit margins for this to happen, and would instead make efforts to manage their short-lifetime product stocks more efficiently. 

This would be the more likely outcome because, in order to be sure of avoiding any levied disposal charges, they would need to send much larger quantities of ‘in dates’ items to food banks as ‘surplus’ stock than they do now. They would also need to do this several days in advance of the expiry date to ensure they had sufficient remaining shelf-life to allow legal distribution by the food banks. The supermarkets concerned would then forfeit any revenues they might get by selling those items at full price during the last few days before their expiry.….

Some food for thought for our policy makers, perhaps....

Viv

First published 14.4.23