Fighting food waste with…more grocery stores? ‘The more stores you have, the lower food waste is going to be’
An estimated 1.3bn tonnes of food is lost or wasted each year, equating to roughly one-third of the food produced for human consumption.
Food waste occurs across the entire value chain: from food production, through handling and storage, processing and packaging, distribution and market, to consumption. Yet in developed countries, waste is largely skewed downstream.
According to the UN Food and Agriculture Organization (FAO), in industrialized nations, more than 40% of food losses occur at retail and consumer levels.
Fresh research out of Cornell University suggests taking a somewhat ‘counterintuitive’ approach to tackling food waste: open more grocery stores.
“The more stores you have, the lower food waste is going to be,” said study author Elena Belavina from Cornell University’s SC Johnson College of Business.
Doing more with less waste
If consumers can purchase perishable goods nearby, they may shop more frequently, yet buy fewer products each time.
“There’s less food sitting at home. As a result, there is a much lower likelihood that something will be spoiled, and we’ll actually be able to eat all the stuff that we’ve purchased before its expiry date.”
This was the thinking behind Belavina’s study, which sought to determine the impact of grocery-store density on food waste generated at stores and by households.
The researchers built and calibrated a stylised two-echelon ‘perishable-inventory’ model to capture grocery purchases and expiration at competing stores and households in a market. They then examined how the equilibrium waste in this model changes with store density.
Results revealed that an increase in store density decreased consumer waste due to improved access to groceries.
At a retail level, however, food waste increased. This is largely due to the decentralisation of inventory, increased variability propagation in the supply chain, and reduced consumer demand.
Higher density was also found to boost competition between retailers, encouraging stores to compete on price. This can also lead to increased food waste.
“Overall, consumer waste reductions compete with store waste increases and the effects of increased competition,” noted the study.
Interestingly, the analysis revealed that higher density reduces food waste up to a threshold density, yet leads to higher food waste beyond this threshold.
Encouraging store density – to a point
In Chicago, for example, which Belavina said is typical of many American cities, food waste could be significantly reduced by boosting grocery density.
More specifically, by adding just three or four markets within a 10-square-kilometre area would reduce food waste by between 6-9%.
This could have an important environmental impact, given that food production is responsible for approximately one-quarter of global greenhouse gas emissions.
Belavina estimated that boosting grocery density in Chicago could achieve an emissions reduction comparable to converting more than 20,000 cars from fossil fuels to electric power. “Very small increases in store density can have a very high impact,” she said.
The research also revealed that most big cities are ‘well below’ the ideal density of grocery stores that would minimise food waste. Ideally, Chicago would have around 200 markets within a 10-square-kilometre area, compared to 15 currently. Yet according to Belavina, most of the benefit from reduced emissions would be achieved by about 50 stores.
New York City – which has a great number of produce stands and neighbourhood markets – was found to come closest to its ideal grocery density.
The researcher encouraged store operators, urban planners, and decisionmakers to increase store densities, to make grocery shopping more affordable and sustainable.
So what does this mean for hypermarket retailers? “To increase store density… the addition of smaller format stores is needed – it does not make sense to keep adding big stores,” Belavina told FoodNavigator.
“However, it does not mean that there should not be any large format stores. Just a combination of the two formats, so that households could get their smaller replenishments from local stores, and could potentially visit a large format store on a less frequent basis to get access to an additional variety that the larger format stores can afford.”
Benefiting the environment and reducing food deserts
According to Belavina, early stages of a trend towards ‘going a little bit back in time’ to revive smaller, ‘mum and pop’ stores, has been observed. Yet, governments can do more to help.
“Policymakers should indeed subsidise grocery density increases without hesitation, as these are a win-win: a win for the environment and a win for consumers (the household-grocery-acquisition cost reduces: due to lower travel, lower waste and – potentially – lower grocery prices).
“An increase in fresh grocery store density will also reduce travel emissions, further enhancing the environmental benefits of higher density that arises from food waste,” we were told.
Such subsidies could be a wonderful opportunity for independent grocery stores to rebuild market share and revive those deep connections to the neighbourhoods that are cultivated via such smaller store formats, she continued.
Another area that improved grocery density could benefit communities – particularly in lower-income neighbourhoods – relates to ‘food desertification’.
A food desert is a term used to describe a neighbourhood with severely limited access to affordable fresh whole foods, such as fruit and vegetables. According to 2018 data from non-profit think tank The Social Market Foundation, 10.2m people live in food deserts in the UK alone.
In the US, food desertification is also a major issue. In 2009, an estimated 23.5m people lacked access to a supermarket within a mile of their home. Low-income communities are thought to have access to 25% fewer grocery stores or supermarkets.
Belavina told this publication that by increasing the number of grocery stores in such underserved areas, residents would certainly gain access to fresh food.
“At the same time, with the addition of these new stores, folks who used to drive much further to get their fresh groceries, [would be able to switch] to these new and closer outlets …and reduce their food waste.”
Source: Manufacturing & Service Operations Management
‘Grocery Store Density and Food Waste’
Published online 30 January 2020
Author: Elena Belavina