Food waste hurts supply chains

A new report released by the National Resources Defense Council revealed that up to 40 percent of food in America is wasted.

This huge percentage is estimated to add up to about $165 billion annually. Americans now throw out 50 percent more food than they did in the 1970s.

The waste occurs throughout the food supply chain. Losses may happen at any point in the system: in fields, processing, distribution, retail stores and in homes. Some of this waste is inevitable at many stages of the supply chain. Crops can succumb to pest problems or drought, and products can become inedible due to packaging damage or a technical malfunction.

In spite of some expected losses, much of the waste is avoidable. Produce farmers usually need to have their products comply with certain standards, and a somewhat crooked carrot is often considered unacceptable. This result is a huge amount of perfectly edible but unmarketable food wasted in the early stages of the supply chain. Some farmers are taking advantage of the products that do not meet retailer standards and using them for other purposes to help eliminate food waste. Baby carrots were created by a farmer who cut up his irregularly shaped carrots that retailers would not sell them. Farmers markets are another way for farmers to sell their produce that may not fit retail standards.

The waste continues during the retail stage, when supermarkets overstock their fruit and vegetable bins, resulting in faster spoilage. Retailers are often required to keep a full stock to appeal to consumers, but this results in large amounts of spoilage at this point in the supply chain. As a result, some retailers are refraining from throwing out expired or cosmetically imperfect goods and repurposing them to reduce waste.

Plenty of food is also lost after preparation. Restaurants that serve huge portions see a large amount of waste, as do those that offer extensive menu selections and are required to have extensive ingredients. Unwanted sides that accompany the food are also often wasted, as they are typically undesired by the consumer. Preparation waste also is common in households, when families prepare too much food and neglect to eat leftovers.

Food waste is a serious problem that hurts supply chain optimization. Starting at the beginning of the chain, food waste is rampant and can hurt a company's bottom line. Examining supply chains to determine exactly how much waste is occurring can result in cost savings as well as less thrown-out food.