Tackling food waste is a core component in the responsible growth of our business. On the one hand, well monitored food management in our stores and distribution centers reduces our operational costs and directly supports our growth. On the other hand, product promotions that are effective strategies for revenue growth can increase waste at the consumer end. These two impacts show the need for a holistic approach to food waste management in our industry, from food logistics in our operations to consumer behavior.

To address this challenge, we have taken a three-tiered approach that includes prevention, donation and conversion. All of our operating companies are active in some or all parts of this approach.

Prevention

Prevention has two components. The first is designing waste out of our system. All of our operating companies have IT systems in place to monitor our ‘shrink’, which is the loss of products between purchase from the suppliers and the point of sale.
Shrink includes loss of products due to theft, damages in transit or in stores, administrative errors and failure to sell perishable goods before their sell-by dates. Our systems provide clear visibility to our food waste which enables us to develop more effective means for reducing it.

Delhaize Belgium has, for instance, a shrink management committee made of experts from different departments along the product sourcing chain. This committee meets every month to review overall results, ranging from broad categories down to specific products, packaging and the shelf life of goods.
Two concrete examples of actions taken by the shrink committee with a direct impact on reducing food waste in our stores are reducing the packaging of shrimp products (unsold because portions were too large) and shortening the time it takes for a product to reach the store, which increases the product’s shelf life.

The second component is consumer education. Educating consumers about how to store and use products in ways that ensure a longer life is an important part of reducing food waste. We do this through consumer communications in stores and online. Click here to see food safety tips at our operating companies.

Donation

For food on the shelves that does not sell, we focus first on whether that food can go to feed people (first priority) or animals.

• Feeding people

  Across the Group we donated more than 20 000 tonnes of food to food banks in 2010. This figure captures primarily non-perishable foods that were unmarketable but still safe and edible food. In addition, many of our stores donate perishable foods directly to local food pantries, but these donations are not tracked. Click here to read our 2010 insight on food donations.

• Feeding animals

  Where food is not fit for human consumption, many of our stores send it to farms to be used as feed for livestock. In-store butchery waste is also contributed by some operating companies for use in the production of animal feed.

Conversion

If unmarketable food cannot be consumed, the next option is to convert it to productive use as either compost or energy. The challenge in implementing these approaches comes from a lack of infrastructure and additional labor costs. In particular, Hannaford and Delhaize Belgium have found the biggest challenges in diverting food waste is getting logistics, facilities (space) and local partners in place to set up programs in all stores. Despite these challenges, Hannaford and Delhaize Belgium made progress in 2010:

• Hannaford is successfully expanding its food waste collection program to more stores each year. More than 5 000 tonnes have been diverted from landfills from 30% of its stores and local farmers have benefited from the program over the past few years. Click here to see a video of the different stages of the compositing program.

  What do our stakeholders think about it?

  

  Our partnership with Hannaford has been mutually rewarding in a number of ways. We pick up their food waste and convert it into compost and are now embarking on a project to sell that compost in Hannaford supermarkets to benefit a children’s hospital in Boston. We are turning waste into value for everyone involved.

  

  Roy Ferreira, Transportation Partner, Brick Ends Farm.

   
• In 2010, Hannaford was awarded the Food Establishment Award for Recycling in eastern Massachusetts from MassRecycle for the volume of waste diverted from landfills.
• Food waste from Delhaize Belgium is collected by a third party and undergoes a biomethanisation process which generates biogas. This biogas can be used to produce heat in a gas boiler or electricity and heat using an engine and a generator.

Going forward, we will formalize waste management (including food waste) into our new Group CR strategy to better respond to the challenge. We will share our own best practices globally and test methods for improving efficiency and scale of our food waste management programs to maximize prevention, donation and conversion. Hannaford’s experience will be applied to other banners in the U.S. with a goal of significantly increasing the number of stores that divert food waste across Delhaize America in 2011. For other operating companies where food waste donation programs can be improved, such as Alfa Beta, we are currently investigating potential programs for animal feed. By approaching food waste management more strategically, we are confident that we can make a positive impact on a growing global issue while improving our bottom line.

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