Many IGA retailers are seeing more food cost increases than they have in recent memory. For an independent, it's often difficult to raise prices, and most don't want to put an additional burden on their loyal shoppers. Figuring out clever ways to reduce costs in our low-margin business has never been more valuable than it is today. One simple way for retailers to do that is to focus on reducing food waste, which can also reduce energy waste.
"More than one third of all food in the U.S. gets wasted,” said Director of Sustainable Solutions Michael Challender at Pro Green Technologies, LLC and Professional HVAC/R Services, Inc., a commercial refrigeration company focused on simple, sustainable solutions. "Fixing that could help fight climate change.”
It can also help grocers see more savings and potentially more profits, but they have to be organized and deliberate about their efforts to see significant savings. According to Peter Cooke, director of partnerships and collaborations at the Ratio Institute, many store owners don’t quite know how to leverage their efforts, how to systemize them, or how to quantify the value, which he says makes most waste-saving efforts “random acts of greenness without systemization.”
Grocers are dealing with such a slim profit margin, it’s better to get a handle on those savings rather than leave stuff to chance and randomness,” said Cooke. “You need to leverage as many resources to help you cut costs as possible.”
For retailers in the Independent Grocers Alliance who tout Local Equals Fresh products, these resources are crucial to maintaining this key differentiator. Keep reading for innovative and cost-cutting tactics to reduce food and energy wastes.
1. Train Your Associates on the Dangers of Overcrowding the Refrigerator
Experienced managers know that blocking a refrigerator's vents with product reduces cold air and causes food to spoil faster. But do all of your associates know this?
Less experienced associates or vendors will often overcrowd a display and block those vents. "When overstocked, it is like you're sticking your hand in a waterfall. All that cold air falls onto the floor, and meanwhile the food temp is rising above 41 degrees,” Cooke said. "You've got warm, humid air coming in more than cold air being returned if it's not working effectively any longer."
Retailers and managers can issue a quick reminder to their team to keep the vents clear, which may save the store thousands of dollars over the course of a year.
2. Gain a Quick Payback on Energy Efficient Coolers
In addition to using and organizing your refrigerators and freezers correctly, consider reinvesting some pandemic profits in coolers that increase the shelf-life of products by maintaining consistent temperatures in the display cases. “Changes in temperature cause foods to lose quality and flavor,” Challender said, adding that frozen foods are also affected. He recommends cases that use a natural refrigerant (R290) with a low Global Warming Potential (GWP) rating for carbon dioxide emissions, like the Novum, and adds that when it comes to refrigeration, retailers will save money by improving efficiency and reducing leak potential.
Leo Braido, owner at Oberlin IGA, stands in front of one of his energy efficient refrigerators.
Not only do new energy efficient coolers pay for themselves in energy savings in just a few years, they also allow retailers to showcase more product in a more pleasing way that drives incremental sales per linear foot.
Leo Braido of Oberlin IGA decided the investment in freezers was worth it to reduce food waste, which in turn helps the store's bottom line. He worked with Challender and Pro Green to upgrade and install two self-contained Pure Cold refrigerated display cases because of the low energy use and the low GWP refrigerant R-448A provided by Honeywell.
“Every improvement I have made in the store is focused on being aligned with the city of Oberlin’s desire to be carbon neutral by 2050,” Braido said in an interview with Pro Green. The city's efforts will help more than the environment—they will help the store lower energy costs and therefore reduce wasted food costs, too.
Another bonus of efficient refrigeration? Stopping that cold draft is also known to reduce customer complaints about a chilly store.
3. Turn To Tech
IGA friends in Canada and Australia have been using merchandising applications and calculators to help reduce food waste. Now the U.S. grocery industry is using emerging technology, too, including both simple and complex tools like an app that lets everyone in the supply chain know the age of their produce and artificial intelligence to minimize out of stocks and simplify ordering.
For example, an application like Shelf Engine, which adds analytics to a retailer's existing POS system, helps the store stay in stock on best sellers, reduce inventory on slow sellers, and anticipate growing shrink problems in time for a retailer to fix it. Data partners like BR Data add inexpensive add-on solutions that can give an owner or store manager diagnostics to reduce shrink and waste and improve top line sales.
"It’s very hard to predict what a grocery store is going to need, but this technology helps the store buy the right amount of stuff," Cooke explains. "Grocery stores survive on a 1 percent profit margin. Why not use the benefit of tech and science to figure out what your customers need?”
4. Get Your Associates In On the Cause
Who would have thought that being good at reducing food waste would be a way to recruit associates to work for your store? In reality, younger workers (and really, all workers) want to work for companies who are in business for more than just making a profit, according to IGA CEO John Ross. "If you align your company values with your recruiting message, you will find that workers will not only flock to your store versus the competition, but they tend to stay longer, too," he said.
"Reducing food waste is a problem that all Americans should be passionate about," Ross continues. "Gathering your associates together and making it clear that reducing food waste is an important mission for you and your business can get them to not only follow your instruction, but come up with dozens of great ideas on their own that may surprise you in their effectiveness."
Cooke agrees, adding that showing employees why recycling is important goes a lot further than simply asking them to do it correctly. He recently visited a small chain of stores in Cedar Rapids, with all except one struggling to get the kitchen staff to keep plastics out of the recycling bin. What did the one store do differently? They invited the farmer who collected the waste to come in and explain to the staff why a random strawberry clam could spoil a whole batch of pig feed.
That one free farmer visit changed the whole game, dropping food waste dramatically. “Keep the message, change the messenger, and boom—they all do it,” Cooke said.
Let your team offer up ideas, too. At a store in upstate New York, Cooke spotted a tricked out U-boat cart one employee had turned into a waste-eliminating cruiser. With the store already selling cardboard for money and employees doing rounds looking for spoiling food in-store, one team member had a lightbulb moment: why not combine two jobs into one? He strapped buckets to the U-boat cart, which allowed him to scour the store for recyclable cardboard and food waste at once, keeping the store looking fresh in half the time.
This employee had an opportunity to be engaged in the operations of the store that had to do with overall sustainability,” Cooke said. That kind of excitement is important because engaged employees are more productive. “The message is if you can engage your employees on the social or environmental aspects of their job—and food waste is both—it leads to increased levels of job satisfaction,” Cooke said.
Give your customers and staff contextual awareness on how your store’s food diversion works. “When an employee feels like they’re contributing to the community, your job satisfaction rates are going to go up,” Cooke said.
After years of experience, Cooke can walk through an independent grocery store and spot at least $15,000 in waste savings, which translates to big savings for stores. “Economics is not a 1:1 ratio and independent grocers know it's easier to cut costs than increase sales,” he said. “With indie grocers I can find $15,000 in savings, which is equivalent to $270,000 in sales.”
In fact, Cooke has been sharing these recommendations with IGA retailers and store managers for years, most recently leading the Sustainability module within the IGA Coca-Cola Institute's International Supermarket Class. And while that live class ended in January, retailers and associates can enroll in the virtual Grocery Stewardship Council Top 5 Grocery Store Energy Savers class to learn more about his recommendations to save energy, food waste, and money.
Do you have creative ways to reduce waste in your store? Share your ideas with our online group of IGA store owners.
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