Startups Help Restaurants and Grocers Reduce Costs and Carbon Footprint.


Nearly a third of all the food produced around the globe goes to waste. Just think about that for a second. People in the most developed countries waste over 220 pounds of food, on average, per year. That’s a bitter pill to swallow when 1 in 9 people is going hungry.

But the effects reach far beyond those who don’t have enough to eat. According to the United Nations, food waste is one of the biggest causes of global climate change, generating 4.4 gigatons of greenhouse gasses on an annual basis. If this food waste was a country, it would be the third largest emitter of greenhouse gasses after the U.S. and China. The U.N. estimates the waste has a combined social, economic and environmental impact of $2.5 trillion per year.

It’s an issue that manufacturers, grocers, restauranteurs, consumers and maybe even politicians will need to work together to solve. But fortunately, it is also a blue-sky opportunity for innovation and savvy investors.

Singaporean company GoodForFood, is one of the scrappy entrepreneurial startups that has come up with an innovative approach: fighting food waste with computer vision and analytics.

The company has created a smart trash bin for the restaurant and hospitality industries that identifies what kind of food is being thrown away, weighs it, and provides analytics to the restaurant. Restaurants can then use this data to save money by adjusting their supply orders and, in turn, reduce their overall carbon footprint.

One of the more established companies in the food waste reduction space, LeanPath, has been helping companies cut waste since 2004. The company has evolved quite a bit since its inception, adding several arms to its food conservation service.

LeanPath offers the hardware to collect and measure waste, dashboards to track and analyze waste, and culinary coaching services to help kitchens repurpose the food as other dishes. LeanPath counts Google among its long list of clients, and since 2014, they’ve helped the tech giant save over 6 million pounds of food waste.

Grocery is also in need of adaptation, and with the additional pressure of the rapidly growing online grocery sector, a leaner and more efficient strategy makes a lot of sense.

A recent study by ReFed estimated the cost of food waste is more than double its original profit potential, calling it an $18.2 billion dollar opportunity for grocers.

Albert Heijn, the Netherlands’ largest grocer, is taking notes from eCommerce to combat the problem. The Dutch grocer recently began a pilot program offering “dynamic discounts” as food items approach their expiration date.

The company has partnered with Israeli startup Wasteless, who offers a dynamic pricing algorithm that targets food waste. Ecommerce platforms like Amazon use similar algorithmic dynamic pricing to maintain strategically low prices.

Early case studies from Wasteless offer promising results. An early project with a Spanish grocer yielded a 33% decrease in food waste, while boosting revenue by 6.3%. The company, which has raised over $2 million in funding so far while operating in Europe, now has its sights set on the U.S. market.

But perhaps the most important piece of data in this battle to reduce food waste is the simplest one of all: expiration date labels.

In the United States, there is no standardized model for expiration labeling. Due to the lack of clarity between vague indications like “Sell by”, “Best by”, “Use by” and many others, 90% of consumers misinterpret these labels, causing them to throw away food that is still safe to eat.

In 2016, Walmart began requiring all of its food suppliers to use standardized expiration date labels, indicating two dates on each label: “Best if used by” and “Use by”. Two weeks ago, Democratic Congresswoman Chellie Pingree of Maine and Republican Congressman Dan Newhouse of Washington took this a step further when they introduced a bipartisan bill to establish uniform food labeling on a nationwide scale.

Time will tell if the regulation will make it through Congress, but many manufacturers have already started to evolve their labeling voluntarily, as this is a win-win for everyone, from the farmer to the retailer to the customer, and most importantly, the planet.

Food waste is a difficult and far-reaching issue, but thankfully, it’s being addressed from multiple angles from the public and private sector alike. When you can cut costs, increase profits and protect the environment, pretty much everyone is onboard.

What do you think about using data-driven approaches to decrease food waste? What are the biggest factors contributing to food waste that you’ve seen? What are the most exciting solutions you’ve seen? We’d love to hear what you think. Sound off on social media now and join the conversation.