Reducing Food Waste at Retail Stores—An Explorative Study

Abstract

Grocery retailers are in a dilemma. They often prioritize availability over other aspects due to strong competition in this sector and the imperative of realizing sales. The target for many grocery retailers has been high on-shelf availability and large variety to increase customer satisfaction. However, this policy contributes to a significant share of overstock. The economic pressure of unsold products, the environmental impact of wasted resources, and the ethical questions arising from discarding edible food, have increasingly thrown the spotlight on grocery retailers to change their strategies. Grocery retailers are thus facing a trade-off between increasing attractiveness via high availability on the one hand, and the environmental, social, and financial impacts of overstock, on the other. One common practice in dealing with overstock is mainly being reactive to mitigate the impact, using initiatives such as price promotions or donations. This explorative study investigates options for how grocery retailers can proactively reduce food waste via better planning of their store operations. Seven case companies participated in this qualitative study, where we focused on ultra-fresh products as the most important waste category. Face-to-face interviews with managers were the primary source for data collection. The heterogeneity of our sample enabled us to build a common understanding of proactive options to reduce food waste with enhanced operations. The analysis reveals six coherent and distinct topics. A basis for all proactive operational planning processes is (1) the use of a comprehensive database and information systems. This builds the foundation for (2) tailored demand forecasts related to perishable product-specific requirements. Subsequently, consideration is needed of (3) the enhanced planning of assortment sizes, (4) the definitions of differentiated service levels and (5) the tailored ordering and replenishment processes that impact food waste. Finally, (6) salvage options, such as dynamic pricing, secondary usage, and sustainable waste streams constitute valuable mitigation strategies. We formulated 15 propositions that could support the decisions of grocery retailers developing proactive food waste reduction practices. These propositions will guide future research, as they provide a coherent and cohesive picture of related topics in grocery retail operations.