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How Managing Food Waste is a Key Part of Maximizing Profitability

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Wasted Food = Wasted Money

Food cost is the single largest line item on a food business’ profit and loss statement, yet food waste is largely unregulated and rarely addressed.  In a moment that begs for recovered revenue, tackling food waste is an opportunity for restaurants and food service providers to dramatically improve their operational efficiency, maximize profitability in the short term, and invest in sustainable savings in the long term.

Restaurants and foodservice facilities have been cited to have the largest profit opportunity in addressing food waste and COVID-19 presents an opportunity to reimagine traditional business models.

In the United States alone, 40% of all food produced never meets a consumer. This waste happens throughout the supply chain, but the majority of it comes from consumers and consumer-facing food businesses. Businesses specifically, throw out 57 billion dollars of food waste each year.

Creating a strategy in place to align all your tactics takes time. My favorite quote as a strategist is from Sun Tzu: “Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.”

Managing Uncertainty

Food waste thrives on uncertainty, and COVID continues to present unprecedented trouble to food businesses. The past six months have proven how vulnerable our food systems are, and just how necessary it is to understand how to manage them moving forward.

Customer flow and ordering patterns are fluctuating by the day, but tracking these patterns can help operators get ahead of all the ails that come alongside uncertainty. Having an informed idea of how much product businesses are moving, but even more crucially, how much of each product is being discarded, leads to more efficient operations and more strategic ordering.  

The old saying goes, “you can’t manage what you don’t measure,” and food waste is no different. The necessary first step to any attempt at tackling food waste is waste tracking and analytics.  By tracking and analyzing waste patterns, operators can stop food waste before it starts and improve margins by strategically reducing ordering and production quantities. There are multiple ways of doing this, from pen and paper logging to innovative technology like Phood.  

In essence, waste tracking just seems logical -- a way for businesses to better understand their operations and maximize efficiency and cost savings. The lack of awareness around its benefits have prevented restaurants and food service providers from investing in the solution, but this moment of flux serves as an opportunity to embrace innovation.

Getting Creative

High impact solutions are not inaccessible. Recent advancements have made high-tech, low-labor options affordable in the wider marketplace. Technology can now solve this problem and do it seamlessly.  As business models shift to focus on re-entering the world post-COVID, waste tracking and analytics must be incorporated into any food business. Food waste is an existential threat and one of our most illogical global issues. Everyone has a role to play in tackling it, and when doing the right thing also dramatically improves our business efficiency and cost savings, the question becomes – why not?